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, mainly in the insuranc...

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UPDATED: Oct 19, 2021

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Important facts to know...

  • You’re required under state law to purchase auto insurance on any registered vehicle that you own
  • States require vehicles to be insured and not necessarily licensed drivers unless the driver has serious convictions
  • Premiums are affected by many factors including the type of vehicle that you drive and drivers in the household
  • Adding new drivers or vehicles to your policy could affect your rates but not because you have multiple drivers in the home
  • Auto insurance follows your vehicle in most cases but may also follow the driver when operating other vehicles

Auto insurance got its name because it provides coverage for private passengers automobiles.

Amazingly enough, a majority of policies cover the driver who owns the vehicle more than the car itself because auto insurance requirements for standard coverage don’t say that you must carry coverage that pays for damage to the vehicle being insured.

Some people would agree that the term “driver insurance” might be more appropriate for a basic auto policy.

As you’re shopping for auto coverage, you’ll need to know how the law works and also how your premiums are calculated at the end of the day. Having multiple drivers may affect your rates on your policy, but not in the way that many people think.

Whatever your situation, you can compare quotes today using our free rate comparison tool above.

If you’re curious to know if auto insurance is per driver or per car, here’s what you need to know:

What’s required by state law?

State law says that you have to purchase auto insurance if you’re going to exercise your right to own a private passenger vehicle.

The insurance requirements are in place just to ensure that anyone who owns property can pay for damage that arises out of the operation of the property. This is why you’re required to purchase insurance on each vehicle when you’re the legal owner.

You don’t have to buy all types of auto coverage, but you do have to have at least the state mandatory minimums to stay in compliance.

These mandatory minimums usually include third-party liability coverage options like bodily injury and property damage. In no state are you required to carry damage coverage for your car.

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Are drivers who don’t own vehicles required to carry coverage?

If you license your vehicle, you’re going to have to provide evidence that the vehicle is insured in the state. The same rules don’t apply when you’re applying for a driver’s license.

You do have to meet certain requirements before you’ll be granted your driving privilege but that doesn’t mean that you have to have insurance when you don’t own a car.

Some Drivers May Be Required to Maintain Insurance

You don’t have to show that you have insurance to initially get a driver’s license but you may have to at some point in your life. Drivers who don’t own vehicles could still be asked to file an SR-22 with the DMV as evidence of financial responsibility.

This document is usually only required when the driver has a blemished record. Some reasons you may have to buy SR-22 insurance include:

  • You have been convicted of a DUI/DWI
  • You have had a serious accident involving bodily injury or death
  • You have had an accident where you were uninsured
  • You’ve been pulled over for driving without insurance multiple times
  • You have several points on your license and are close to a suspension

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Does your auto insurance follow the car or the driver?

If you purchase auto insurance, the vehicle that’s listed on the declarations page is classified as the covered auto. There is a huge debate as to how insurance coverage works.

Some people claim that coverage follows the car and others claim that the coverage follows the driver. No matter what side of the debate you’re on, you’d be right.

Car insurance follows the car when listed drivers on the policy are driving and also when others get behind the wheel.

As long as the drivers who borrow your vehicle don’t live in the home, like a boyfriend or girlfriend, and have permission to drive the car, accident claims will be covered if something were to happen.

While insurance is known to follow a car, it might also follow a driver. Drivers on the policy need protection when they are driving other vehicles that aren’t in the covered auto, including when the driver is borrowing a car, or they are renting a car. If you are regularly driving a vehicle, you need to be listed on the insurance policy, even if it is in someone else’s name.

While not all of the coverage extends when borrowing a car, you will have at least some liability protection to ensure that you have financial protection if you crash.

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How are your auto insurance rates calculated?

Insurance companies calculate rates thoroughly. They have to set a base rate that’s dependent on the marketplace, administrative expenses, and overhead, but that’s not what dictates what you pay.

Overall, your personal factors will determine whether you’re going to pay a low rate or a higher one.

Once the carrier’s base rate per unit is set, the carrier must ask you loads of personal questions that all pertain to your lifestyle, your driving history, and your cars.

If you don’t answer these questions, there’s no way that the insurer would be able to charge you an adequate rate. Some but not all of these personal factors considered include:

  • Your age, gender, and marital status
  • Vehicle type and model
  • Driving habits and vehicle usage
  • Annual mileage
  • Past driving record
  • Claims history
  • Credit history
  • Past insurance history

Does adding a driver cost money?

As you can see, there’s a long list of items that are used when your agent gives you a quote. It’s all of these factors together that are going to impact your rates so that the company can give you a final rate.

If you add a new driver to the plan, you won’t pay a fixed fee for that driver. It’s more dependent on the driver’s history and classification.

If you were adding an occasional driver to the policy and they are experienced behind the wheel, there could be no change to your premiums. When you add a primary driver to the policy who is inexperienced or has a tarnished driving past, it could really affect your rates.

Auto insurance isn’t about being per car or per driver. Both have an impact in their own ways. Make sure that you’re forthcoming with your answers when you’re getting auto insurance quotes.

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