Do you need insurance to borrow a car?
FREE Car Insurance Comparison
Secured with SHA-256 Encryption
UPDATED: Feb 16, 2016
It’s all about you. We want to help you make the right coverage choices.
Advertiser Disclosure: We strive to help you make confident car insurance decisions. Comparison shopping should be easy. We are not affiliated with any one car insurance provider and cannot guarantee quotes from any single provider. Our partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different companies please enter your ZIP code on this page to use the free quote tool. The more quotes you compare, the more chances to save.
Editorial Guidelines: We are a free online resource for anyone interested in learning more about car insurance. Our goal is to be an objective, third-party resource for everything car insurance-related. We update our site regularly, and all content is reviewed by car insurance experts.
You may not think much of tossing the keys to your friends and letting them borrow your car for a few hours or an afternoon, but what happens if they were to get into a serious accident with your vehicle? It is important to know how insurance coverage works in this kind of situation. Compare car insurance rates now by using our FREE tool above!
Insurance Coverage for Lending a Vehicle
It is a common misconception that car insurance follows the insured person. In fact, it is quite the opposite. Insurance coverage follows the vehicle. So, if you are letting a friend borrow your car, they technically don’t have to have insurance of their own because, in most cases, they are now covered under your insurance. Most states will cover your vehicle no matter who’s driving if you have collision and comprehensive coverage in your policy. However, you have to be careful with this, because there could be some potential problems that could arise and implicate you.
Say you were to let a friend borrow your car and they had a head-on collision with another vehicle that caused major damage and medical expenses. What would happen? If your friend was at fault, your insurance policy would kick in and cover them to the extent of coverage that was outlined in your policy, which could be insufficient to cover everything. If the borrower has their own car insurance, that insurance acts as a secondary insurance and will kick in after your limits of coverage have been exhausted.
If you’ve reached the point where your insurance has maxed out and the borrower doesn’t have insurance of their own, the injured party could potentially come after you for damages and medical expenses.
Although borrowers are generally covered under the lender’s insurance, don’t just assume that that’s automatically the way it is. It is always best to contact the insurance company to discuss the terms of your coverage because every company is different.
Enter your ZIP code below to view companies that have cheap auto insurance rates.
Secured with SHA-256 Encryption
Be Careful of Lending Your Car to Just Anyone
If you do decide to let someone borrow your car, be responsible in your decision to let them operate your vehicle. You need to be able to trust that they will be responsible in driving your car and not engaging in reckless driving or doing illegal acts with your vehicle. Also, make sure that they have a valid driver’s license. You could be sued if an accident is caused because:
- You let someone drive drunk in your vehicle.
- You let someone drive on a suspended license with your vehicle.
Also, be prepared for a major increase in your insurance premium. The insurance company does not tread lightly in these instances.
How to Handle Frequent Drivers
If you are frequently letting someone borrow your car you could be facing a potential problem. The insurance company has set up a premium based on the primary driver and does not account for others unless you add them on to your policy. If you are letting someone borrow your car once every blue moon, you probably don’t need to add them. However, if someone starts driving your car quite regularly, you will want to look at adding them to your policy.
In Maine, for example, if your insurance company finds out there is another person driving your vehicle regularly without being added to the policy, that is grounds for them to deny future claims, based on the fact that you provided them false information at the time of application. Adding another person to your policy will most likely cause your rates to increase, but it is better to be safer in the long run.
Shopping Around for the Best Rates
If you are looking for an insurance policy that will meet your specific needs, it is best to shop around. Comparing quotes from different companies will help you get the best rates possible.
Always make sure you are dealing with a reputable company and carefully read the terms outlined in your policy before purchasing any insurance.
Lending your vehicle should not be taken lightly. Do not let anyone borrow your vehicle if you feel uneasy about them. If you let someone borrow your car, remember the potential consequences that could come back to bite you if they were to get into an accident. Enter your zip code in our FREE tool below to start comparing car insurance rates now!