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A Car by Any Other Name: Insuring a Vehicle Registered to Someone Else

If you’re reading this right now, you’ve probably fallen into an unusual situation where you need to get car insurance for a vehicle that is not registered in your name. First of all, congratulations on being a responsible driver. But the bad news is that you may be in for a bit of a challenge. And it can be an expensive one too. But we’re here to help. That’s why we’ve written this handy guide on how to get insurance for a car that isn’t registered in your name. With any luck, you’ll be successful in accomplishing this task – and save money at the same time!

When Someone Else’s Vehicle Falls in Your Lap

So how, exactly, does someone find themselves in a situation where they need insurance for a car that doesn’t technically belong to them? There are actually many plausible scenarios in which a driver may need insurance for a particular vehicle, or just for themselves as a driver, but not be listed on any vehicle’s registration. Some of those include:

  • A young driver who relies on their parent’s vehicle for transportation
  • A service worker (such as a nanny or babysitter) who uses their client’s vehicle(s) for transportation
  • Someone who frequently borrows the vehicle of a friend or family member
  • If you inherited a vehicle from a deceased loved one

Some people in the situations above may not actively be looking for insurance on a vehicle that they are not registered with. For example, the parent of a teenage driver may think they’re saving themselves money by letting their child borrow their vehicle without listing them as a driver on their insurance policy. As you can see in the chart below, this may make financial sense in the moment:

Family Insurance Premiums Legend: Parent Only Policy Teenage Driver Premiums Family Policy Premiums State Farm Mercury Encompass Allstate 50 100 150 200 250 300 350 400 450 500 $130 $346 $275 $128 $527 $466 $151 $475 $141 $395 $461

But if anything happens to that vehicle while your teen drivers behind the wheel, or any other driver for that matter, things can get very complicated very quickly. And you can rest assured that they will get expensive, too.

How Much Will Such a Policy Cost?

With the exception of inheriting a vehicle from a loved one who has passed, taking out an insurance policy on a vehicle you do not own maybe a costly venture for both you and the registered owner. For starters, you may end up forcing the original owner into a situation where they have a lapse in insurance coverage. As you can see in the chart below, any driver applying for insurance after a lapse in coverage will be facing a serious spike in monthly premiums based on the fact that most insurance companies consider them to be a high-risk driver. Many companies will actually reject drivers based on that circumstance alone.

Lapse In Coverage Costs Legend: After Coverage Lapse No Coverage Lapse State Farm Mercury The General Allstate 30 60 90 120 150 180 210 240 270 300 330 360 390 420 450 $130 $130 $184 $128 $252 $339 $120 $450

But if you’re still determined to get an insurance policy for a car that doesn’t have your name on the title, and you don’t plan on changing that status, you’re in for an uphill battle. Insurance companies will also see you as a perceived risk since you technically don’t have any financial stake in driving that car carefully and avoiding accidents. The more you can do to convince your prospective insurance company that you are a safe driver (such as having a good credit score, a clean driving record, and a favorable insurance score, to name a few examples), the easier it will be to get a fair rate on a policy.

Are There Other Options?

Drivers who need an insurance policy on a vehicle that they do not currently own have a few different options. One of the safest options – financially speaking – is to ask the title owner if they will add you as a driver onto their insurance policy. Most insurance companies will let you do this, even if you are not a blood relative of the title holder. Your premiums may go up slightly, but a little extra expense can save you in the long run if you happen to get into an accident while driving that vehicle.

You can also request that the owner transfer the title to you, or that the owner of the car put you on the title as a co-owner. Asking for a title transfer is risky for the original owner, because as we stated earlier, they will be forced into a lapse of insurance situation. This will make getting a new policy expensive if they end up buying another car and need insurance for it. But there shouldn’t be any financial risk to you, assuming you’ve been insured the entire time.

Lastly, there’s non-owner car insurance. This is a good option for people who rent vehicles frequently and do not own their own automobile. In the long run, non-owner car insurance will be much cheaper than purchasing it from a rental car agency. This is also a good option for professionals who are frequently driving someone else’s vehicle as opposed to their own.

If Those Options Aren’t Available…

If you find yourself in a situation in which none of the alternative options above apply to you, it will still be difficult for you to find insurance for yourself and for the vehicle you plan on driving; but it won’t be impossible. The biggest thing is to make sure that you convince your prospective insurance company that you are a low-risk driver. Otherwise, you’ll be in for some expensive monthly premiums – if you can find a company willing to ensure you at all. And if you don’t believe us, just look at how much more expensive premiums are for “high-risk” drivers with a regular insurance policy.

High Risk vs. Low Risk Drivers Legend: Bad Credits + Tickets Good Credit, No Tickets State Farm Mercury Encompass Allstate 25 50 75 100 125 150 175 200 225 250 275 $206 $130 $282 $128 $247 $151 $141

The best way to make sure you aren’t paying an arm and a leg for car insurance on a vehicle that is not registered in your name is to shop around. By comparing rates from multiple companies in your area, you’ll be able to ensure that you’re getting the most affordable policy your money can buy. And we can help you compare quotes in a matter of minutes.

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