UPDATED: Mar 13, 2020
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What Your Insurance Covers When Someone Else Drives Your Car
So you let your friend or family member borrow your car, thinking that it’ll be a perfectly safe and harmless decision. A few minutes later, you get a dreaded phone call from them informing you that they’ve been in an accident while driving your vehicle. So what do you do now? Can you file a claim with your insurance company? Will they honor that claim? Will your out-of-pocket expenses be higher than they would be if you had been the one behind the wheel? We have answers to all these questions and more.
When Your Insurance Coverage Follows the Driver
If you live in an at-fault state, then the liability coverage of the driver who caused the accident will likely pay for property damage and any medical expenses of the non-fault parties injured in the accident. This is true, even if someone you know was driving your car with your consent when the accident happened. For a clear explanation of when an insurance policy does and does not follow the driver, consider the following two scenarios:
Scenario number one: your friend borrows your car, and causes an accident. If your friend has liability insurance, their insurance company will pay for medical expenses and property damage of the other driver and their passengers. You will not be held liable for the other vehicle, it’s driver, that vehicle’s occupants, or damages to the vehicle. But you will have to file a claim with your insurance company to get your vehicle repaired. And it will likely count against your insurance score, eventually raising your rates.
Scenario number two: your friend borrows your car, and another driver runs a red light and T-bones him or her in an intersection. Since the accident was obviously the other driver’s fault, they will be held liable for damage and injuries to your car, your friend, and anyone else who was in the car at the time. You may still have to file a comprehensive or collision coverage claim, but the other driver’s insurance company will eventually pay to have your vehicle repaired. But no matter who’s found at fault or which insurance company pays for the damages in the end, any claims you file will likely count against you and eventually raise your rates. You can see an example of this in the chart below.
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When Your Insurance Follows the Car
Most of the time, when it comes to collisions, your car insurance policy follows the car – not the driver. No matter who is driving your vehicle, any physical damage which happens to your vehicle as the result of a collision, theft, or an act of nature will be covered by your comprehensive or collision coverage. As we stated earlier, the exception to this rule occurs when someone borrows your car and gets into an accident caused by the other driver. Liability coverage almost always gets paid out by the insurance company of the at-fault driver. If your car is severely damaged and needs to be repaired right away so that your life can get back to normal, you may have to file a claim with your insurance company first to get the ball rolling. But your insurance company will eventually recoup their losses for the at-fault driver’s insurance, even if they have to go to court and sue them for it.
Another scenario and which your insurance follows the car as if someone steals your vehicle and then gets into an accident with it. Regardless of who’s fault the accident is, your comprehensive coverage, which covers theft, will generally pay for damages to your vehicle.
In theory, however, you could be held liable if you are somehow found negligent in protecting your car from theft. In such cases, your liability coverage may pay for any damages or injuries resulting from your car thief accident. In extremely rare cases, your insurance company may deny your claim based on this negligence and make you you 100% financially responsible for damages. Putting an anti-theft device in your vehicle, locking it every time you get out of the car, storing it in a secured structure, or any combination of the above well help protect you from such a scenario.
A Quick Word About PIP
PIP coverage is a form of medical insurance that pays out if someone is hurt it a no-fault accident. Regardless of fault, this coverage will pay for the medical expenses of the named driver and their immediate family. For example, if your teenage son gets into an accident, regardless of fault, PIP coverage will pay for any medical expenses if he is injured in that accident. But if it’s just a friend, non-related passengers in your vehicle, or anyone in the other vehicle involved, pip coverage will not honor the claim.
Non-Owner Car Insurance
If you or someone you know is constantly borrowing other people’s vehicles in order to get around, then non owner car insurance maybe an affordable way to protect yourself from liability in the event that you get into an accident while driving someone else’s car. But since it’s only covers liability, The car insurance policy of the vehicle’s owner will pay for damages when it comes to comprehensive and collision coverage claims.
If you’re the generous type who lend your vehicle out to needy friends or family, that it might be worthwhile to make sure you have a very comprehensive auto insurance policy. Without one, you could be stuck with expensive vehicle repair costs, financial liability in the event of a serious accident, or all of the above if your insurance company denies your claim. Unfortunately, the more comprehensive your policy, the more expensive your monthly premiums will be. If you need more car insurance coverage do you currently have, your best bet is to shop around and compare quotes. And you can do that today with our help.