When you have a friend or family member who is without a car, you’ll likely want to help them out any way you can. You can’t always be available to drive them where they need to go, so you might decide to lend them your car.
However, there are always risks when it comes to driving. You might be wondering: Will my insurance plan cover the potential expenses if I lend my car to someone else?
In most cases, the answer is yes. Auto insurance typically sticks with the vehicle, not the person, so any damage the car accumulates will be covered regardless of who is driving.
If you are lending your car to someone within your family and household, such as a spouse or child, chances are they are already covered under your plan. If there is a person outside of your household who regularly borrows your car, not just temporarily, you may be able to include them in your plan as well.
What If Someone Gets in an Accident While Driving My Car?
If the person driving your car gets into an accident, your insurance may cover the expenses. It depends on your exact policy and the person at fault for the accident.
For example, if the driver who crashed into your car is determined to be at fault, their insurance will be charged.
But if the borrower is determined to be at fault, your insurance will likely be charged. Comprehensive and collision coverage will be needed to cover the cost of damages. Additionally, liability coverage will be needed if there are any injuries sustained.
If the expenses total more than your plan is set to cover, the driver’s plan may also be used. If neither driver has enough coverage to pay for the expenses, the remaining charges will be applied to the owner of the at-fault vehicle.
That means you could end up paying a lot out of pocket, even if you were not in the vehicle during the accident.
Situations Where You Are Not Covered
However, there are certain situations where your insurance will not cover the cost of damages.
This includes if the person borrowed your vehicle without your permission – also known as stealing. In these situations, even if it is a good friend or close family member committing the crime, legal action may be necessary.
Another reason you may not be covered is if the driver is specifically excluded from your policy. This is only allowed in some states.
For example, if you have a household member with an awful driving record, you may have chosen to exclude them from your policy to receive a lower premium. Therefore it is not a wise decision to let this person borrow your vehicle.
Finally, if the borrower is not on your plan and they receive a ticket while driving in your vehicle, it is the driver who will be held responsible. Your insurance premium will not likely rise.
On the other hand, any tickets or collisions caused by people who ARE covered under your insurance plan can cause your premiums to rise.
Should I Let Someone Borrow My Car?
If you are still unsure if letting someone borrow your car is a good idea, ask yourself these questions:
- Is the borrower insured?
- Do I trust them with major expenses?
- What are they using the vehicle for? (Note that commercial driving may fall under different rules depending on your policy.)
- How often/for how long will they need to borrow the vehicle?
- Do they live in a different state? (Note that insurance laws differ depending on the jurisdiction, which might cause complications for you.)
- Are they always careful, responsible, and fit to drive?
Ultimately, lending someone your vehicle is a major act of trust. If you do not fully trust the person, it is better to be safe than sorry and decline their request.
If you still have questions regarding your specific policy and who is covered, contact your insurance agency to learn more.
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