Zaneta Wood, Ed.S. has over 15 years of experience in research and technical writing bringing a keen understanding of data analysis and information synthesis to reach a wide variety of audiences. She studied adult education and instructional technology at Appalachian State University as well as technical and professional communication at East Carolina University. Zaneta has prepared technical p...

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Leslie Kasperowicz holds a BA in Social Sciences from the University of Winnipeg. She spent several years as a Farmers Insurance CSR, gaining a solid understanding of insurance products including home, life, auto, and commercial and working directly with insurance customers to understand their needs. She has since used that knowledge in her more than ten years as a writer, largely in the insurance...

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Reviewed by Leslie Kasperowicz
Farmers Insurance CSR 4 Years

UPDATED: Aug 24, 2015

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Many assume that car insurance is only for those who own the vehicle that they regularly operate. While standard policies are only sold to registered owners of private passenger cars, individuals who choose not to purchase their own car still need protection when they use their driving privilege. Even though these drivers are avoiding buying a policy that specifically insures an owned car, they still may need a specialty insurance plan to protect them when they do get behind the wheel. Start comparing car insurance rates now by using our FREE tool below!

Non-owned car insurance is specifically for licensed drivers who frequently drive vehicles they do not own and who want financial protection from the hit that they will take if they do get into a crash. Choosing to take your friend’s car for a joyride or to rent a car could wind up in financial devastation if you are not protected or prepared. If you want to avoid having a horror story to tell your friends and your family, learn from the mistakes of others and buy low-cost protection before you ever need to use it. Read this guide to non-owners car insurance and then you can decide if it is worth the cost.

What is non-owned car insurance?

Non-owner car insurance is for a driver who drives someone else’s car with the permission of the owner. The product is designed to insulate the policyholder from the financial hardships that can come when someone gets into an accident and they are responsible for paying for the damages that they cause. Unlike a Personal Auto Policy, which provides liability protection for a specific owned vehicle and other substitutes, a non-owner policy offers bodily injury and property damage protection for a specific person and not for a specific car.

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Are you required to buy liability insurance when you operate a car?

The state mandates that anyone who owns a car must be able to prove that they are financially responsible before they can legally drive it. While there are multiple ways to prove financial responsibility, a majority of states will have either compulsory or mandatory auto insurance laws. While you are capable of causing damages and injuries in a car that you do not own with your negligent actions, you are not required to buy your own liability protection if you are driving a vehicle that you do not own.

It is the owner’s responsibility to maintain coverage, but the victim who suffers damage is legally entitled to sue both the owner and you for your behaviors that led to the crash.

If the owner’s insurance does not extend coverage to you as a permissive user, this could land you in hot water when you need to hire a lawyer or appear in court to negotiate a fair settlement that you will be left to pay out of your pocket.

Types of Protection Afforded by Non-owner Insurance

The policy will offer personal liability protection just for those who are not legally required to buy coverage because they do not have a car, but does not offer any type of physical damage coverage for these non-owned cars that are being driven. The following can be included in a non-owners policy to provide you with financial protection and a sigh of relief:

  • Bodily Injury Liability: Provides third-party protection for medical bills
  • Property Damage Liability: Provides third-party protection for repairs of real property
  • Uninsured Motorist: Provides you with money for medical bills if injured by uninsured motorist
  • Medical Payments: Provides you with money for your medical bills regardless of who is at fault for the loss

Scenarios Where You Should Consider Buying Non-owners Insurance

If you are not licensed to drive, you should not legally get behind the wheel at any time. You are also not eligible for any type of coverage for insurance when you have not tested for your driving privilege. Those who are licensed to drive and who do actually use their license should consider buying an affordable policy for those scenarios where they could suffer a loss. Here are some of the scenarios where people who do not have regular access to a car should buy specialty coverage:

  • You Carpool with a Friend and Drive Their Vehicle

If you are in a carpool group and you drive a vehicle that you do not own to give the owner a break, you should have liability coverage that protects you. You will be driving in very congested and tense situations and are likely to have a loss. If you do have a loss, it can be very difficult to get protection for yourself when the owner is filing a claim on their insurance even though insurance does follow the car in some scenarios.

  • You Rent a Car on a Regular Basis

If you rent a car for business or pleasure and you are on the frequent renters list, you should probably have non-owners insurance. You do have the option to purchase rental car insurance or supplemental personal liability, but this can be very expensive. You can waive the liability protection and still take the damage waivers to cut down on the rental costs and to get protection when you are and are not renting.

  • You Plan on Buying a Car in the Future

If you will not own a car for a temporary period of time but do plan to buy a car in the future, having prior insurance can help you save on costs when you buy a standard plan. By maintaining your coverage, you can show the insurer that you are responsible and also that you have no claims because you have good driving habits. If you stay with the same insurer, you may also be able to get a loyalty discount when you are ready to transition from non-owned insurance to standard insurance.

Not owning a car does not mean that you should always not own car insurance. Assess how often you drive and consider how long you will go without buying a car of your own before making the decision. If you believe that you need specialty coverage, you should price the rates. Coverage is inexpensive because you will not always be driving. You can use an online tool that give you access to multiple rates to price shop in the most effective manner and to bind your coverage quickly for your next ride. Start comparing car insurance rates now by entering your zip code in our FREE tool below!