If you get into a car crash, you’ll need to notify your insurance company. But what happens if you’re driving a friend’s car when the crash happens? Car insurance issues can get complicated quickly. One of the most common sources of confusion is whether an auto insurance policy follows the car or the driver. Here’s how it works.

Car insurance usually follows the car.

Car insurance laws vary from state to state, and individual policies can come with different terms and exclusions. It’s always important to read your policy carefully to understand how it works. However, in general, car insurance follows the car, not the driver.

This means that if you give someone permission to drive your car, you could be responsible for any claims that result. Think twice before handing your keys over to anyone.

But the driver’s policy may still have to pay.  

Although car insurance usually follows the car, there are exceptions.

If you cause a crash while driving someone else’s car, a claim may still be filed against your insurance policy, so don’t assume you’re off the hook.

In some cases, a claim will be made against BOTH insurance policies. This can happen when the damages or injuries are severe. For example, if you borrow a friend’s car and cause a crash, your friend’s insurance will likely be considered the primary insurance. However, if the damages exceed your friend’s limits, your policy may provide secondary insurance to cover the remaining damages.

Also, you can get coverage without a car.

The existence of non-owner’s insurance further complicates the picture. Non-owner’s insurance is auto insurance coverage written for people who do not own a vehicle but who drive borrowed or rented vehicles.

In some cases, drivers may get this type of insurance because they are required to by a court. For example, some drivers who have had their license suspended after a DUI may need to get SR22 insurance, even if they don’t have a car, before getting their license reinstated. People in this situation will have to purchase non-owner insurance, which provides liability coverage.

And some drivers may be excluded.

Even though car insurance often follows the car, coverage will not apply to excluded drivers. This is one of the most important issues to consider when determining whether an insurance policy will follow the car.

When you purchase a car insurance policy, you’re expected to tell the insurer about all drivers in your household. Normally, all drivers in the household will be on the policy. The policy may also cover other people who are given permission to drive the car occasionally.

However, drivers can be excluded from policies in a few different ways.

Sometimes, a policy has a named driver exclusion. This is when you list a driver in your household as NOT being covered on your policy. Although this may seem strange, it can be useful if there’s a high-risk driver in your household who would drive up everyone’s rates. In this case, the high-risk driver would need to purchase a separate car insurance policy for coverage.

Other drivers may also be excluded based on the terms of the policy. For example, if you neglect to inform your insurer about a driver in your household or someone who regularly uses your car, this driver could be excluded according to the policy terms. You can also expect unlicensed drivers to be excluded. (Don’t let an unlicensed driver borrow your car!)

Confused yet?

No one ever said car insurance was simple.

Asking whether car insurance follows the car or the driver seems like a straightforward question, but because there are so many variations, it’s hard to give a straightforward answer.

Here are some tips to make sure you always have coverage:

  • Be honest with your insurer. List every car your own and every driver in your household. If you have a unique situation, talk to your insurer about it. You don’t want to wait until there’s a claim to find out whether you have coverage.
  • Read your policy carefully. Make sure you understand any exclusions in your policy. If you don’t understand a clause, ask your insurance agent to explain it.
  • Be careful about lending out your vehicle. If something happens, you could be held liable, so don’t give your keys to just anyone.

Last but not least, review your insurance at least once a year. Make sure you have the right coverage and all the discounts available. Is it time to update your car insurance? Request a quote from JupiterAuto!