Almost all vehicle owners have to pay for car insurance. The problem is that many of these people don’t really understand who their policy will cover. Drivers can be sure that anybody named on a policy is covered for the car that the policy was purchased for. However, policy owners may not be sure what happens if somebody borrows their car or if they rent. In other words, they don’t know if the vehicle or the drivers are covered.
This isn’t totally surprising because states have their own regulations, policies may vary, and a lot of published advice seems pretty contradictory. This article can’t replace the advice from a local car insurance agent or state insurance department, but it will cover some rules about who is typically covered by an auto insurance policy.
Is a Car Insurance Policy Attached to a Driver or a Car?
Typically, car insurance is attached to the car, but there are some exceptions. For example, a vehicle owner is usually free to let a neighbor or coworker borrow a car once in awhile. If the borrowers are licensed drivers, they should still be covered. If a coworker wants to use the car for business, that particular use might not be covered by a personal auto insurance policy.
An insurer won’t extend coverage to members of the family that live in the same house. Lots of parents would love to skip naming teen drivers on their insurance policies. If those young drivers aren’t named on the policy, an auto insurance company might have the right to refuse to pay the claim. Neglecting to mention that a son or daughter just got a license and is using one of the family vehicles is a very bad idea.
The good news is that auto insurance sometimes follows the driver too. Most policies will cover insured drivers if they rent a car for a few days. Typically, the insurance that covers the rental is the same as the coverage on the owned vehicle. People who only carry liability insurance on an older car might want to buy extra coverage when they rent because they won’t have collision or comprehensive insurance, and renters are usually responsible for damage to the car that they rent.
How to Learn More About Who an Auto Policy Covers?
The exact rules about who is covered by an auto policy might vary by state and insurance company. People who plan to lend out their own car or rent another car would probably be wise to call a local insurance agent and make sure. It’s always better to make certain that a car and a driver are properly covered before an accident and not afterwards.