Whether you are letting a friend borrow your car for a quick trip, allowing a family member to use it for the day, or handing someone else the keys while you are traveling, you may wonder what happens to your insurance coverage when someone else is behind the wheel.
Does your auto insurance cover them? Does their insurance take over? And what happens if they are involved in an accident while driving your vehicle?
These are common questions, and unfortunately, there is not always a simple yes or no answer. Auto insurance coverage can depend on your specific policy, the driver, how often they use your vehicle, whether they had permission to drive it, and the circumstances surrounding a claim.
Understanding how your coverage may work before someone else drives your vehicle can help you avoid an unexpected surprise later.
Does Car Insurance Follow the Car or the Driver?
You may have heard that “insurance follows the car, not the driver.” While there is some truth behind this phrase, it is an oversimplification of how auto insurance works.
In many situations, the insurance policy covering the vehicle may be the primary coverage when an accident occurs, even when someone other than the named insured is driving. However, this does not mean that anyone can drive your vehicle at any time and automatically receive the same coverage you would.
Your policy may have specific requirements or exclusions regarding who is allowed to drive the vehicle. The driver’s own insurance could also become relevant depending on the circumstances.
This is why it is important to understand who is driving your vehicles and how frequently they are using them.
What Is Permissive Use?
One term you may hear when discussing someone else driving your car is permissive use.
Permissive use generally refers to allowing someone who is not a regular driver of your vehicle to drive it with your permission.
For example, you might let a friend borrow your car to run an errand, allow a relative visiting from out of town to drive it, or have someone drive your vehicle home because you are unable to.
Depending on your insurance policy, coverage may extend to someone who occasionally drives your vehicle with your permission. However, permissive-use rules can vary between insurance carriers and policies.
There is also an important difference between someone who occasionally borrows your car and someone who drives it regularly.
What Happens If Someone Else Wrecks My Car?
If someone has permission to drive your vehicle and gets into an accident, your auto insurance policy may generally be the first policy considered for coverage.
Exactly what is covered will depend on the coverages included on your policy and the circumstances of the accident.
For example, liability coverage may help pay for injuries or property damage the driver causes to someone else, subject to your policy’s terms and limits. If you carry collision coverage, it may help pay for damage to your own vehicle after a covered accident, subject to your deductible and policy terms.
The person driving your vehicle may also have their own auto insurance. In some situations, their policy could potentially provide additional or secondary coverage. How the two policies interact will depend on the individual policies, insurance companies, and details of the claim.
It is important to remember that even though someone else was driving, a claim involving your vehicle could still affect your insurance history or future premium.
Lending someone your car also means potentially lending them your insurance coverage.
What If Someone Drives My Car Regularly?
Occasional borrowing is very different from regular use.
If someone lives in your household or frequently drives your vehicle, your insurance company may require that person to be disclosed and, depending on the situation, listed as a driver on your policy.
For example, if your spouse, partner, child, roommate, or another household member regularly uses your vehicle, you should not assume they are automatically covered simply because you gave them permission.
The same concern can apply to someone who does not live with you but uses your vehicle frequently.
Insurance companies use information about the people who regularly operate insured vehicles to accurately evaluate risk and determine premiums. Failing to disclose a regular driver could create complications if a claim occurs.
If another person has started using your vehicle on a regular basis, contact your insurance agent and make sure your policy accurately reflects how the vehicle is being used.
Are There Times Someone Else May Not Be Covered?
Yes. There are situations where allowing someone else to drive your vehicle could create coverage issues.
One example is an excluded driver. If someone has specifically been excluded from coverage under your policy, allowing that person to drive your vehicle could result in little or no coverage if an accident occurs, depending on the policy and applicable laws.
Coverage may also become more complicated when someone uses your vehicle without permission.
Another potential issue is an undisclosed regular or household driver. If someone regularly operates the vehicle but was never disclosed to the insurance company, the carrier may need to investigate the circumstances when a claim is filed.
There may also be restrictions based on how the vehicle is being used. Personal auto policies are designed primarily for personal use, and certain business or commercial activities may require different coverage.
Because insurance policies vary, you should never assume that every licensed driver is automatically covered to drive your car.
What About Letting a Teenager or Young Driver Use My Car?
If a teenager or young adult in your household begins driving, it is especially important to contact your insurance agent.
Even if they only occasionally use your vehicle at first, your insurance company may have specific requirements regarding newly licensed household members. Waiting until after an accident occurs is not the time to find out that someone should have been disclosed or added to your policy.
Your agent can help you determine when a new driver needs to be listed and explain how adding that driver may affect your coverage and premium.
What Should I Check Before Letting Someone Borrow My Car?
Before handing over your keys, there are a few things worth considering.
First, make sure the person has a valid driver’s license and that you are comfortable with their driving history and ability. Remember that if they cause an accident in your vehicle, your insurance policy could become involved.
You should also consider how frequently the person will be using your car. Letting a friend borrow your vehicle once is very different from allowing someone to drive it several times each week.
If the person will be driving your vehicle regularly, lives in your household, or you simply are not sure how your policy handles other drivers, contact your insurance agent before they begin using the vehicle.
A quick conversation beforehand can be much easier than sorting out a coverage question after an accident.
Every Auto Insurance Policy Is Different
It can be tempting to rely on general rules you hear online about who is covered to drive a vehicle, but auto insurance policies are not all identical.
Coverage can vary by insurance carrier, policy type, driver, vehicle, state, and situation. Your liability limits, deductibles, physical damage coverage, exclusions, and listed drivers can all play a role in determining how a claim is handled.
That is one of the advantages of working with an independent insurance agency. Instead of trying to interpret your policy on your own, you have someone you can contact when your circumstances change or you have questions about your coverage.
Have Questions About Who Can Drive Your Vehicle?
Letting someone borrow your car may seem like a simple favor, but it is worth remembering that you are also potentially putting your insurance coverage at risk.
Before allowing someone to regularly drive your vehicle, make sure your auto policy is set up correctly and that all necessary drivers have been disclosed.
At Davis Insurance Agency, Inc., we are happy to help you review your auto insurance coverage, answer questions about drivers on your policy, and make sure your coverage fits your current situation.
Have a question about your auto insurance or need a quote? Contact us today. We would be happy to help.