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Car insurance policies are generally made up of several types of coverage. Some of these always stick with the vehicle, such as collision and comprehensive coverage, because they cover damage to or theft of the vehicle. Others, like liability coverage, might follow the driver.
In either case, if you give someone else permission to drive your car, you will likely have to file a claim with your insurance company if they cause an accident. However, specifics can vary depending on state laws, your policy and the circumstances.
Does Insurance Cover the Car or the Driver?
Car insurance can cover the car and follow an insured driver depending on the type of coverage and the incident. If you have full auto coverage, your policy may include:
- Liability coverage: Covers costs and legal fees when the covered car is in an accident that injures someone else or damages someone else's property.
- Collision coverage: Covers repairs to the covered car when it's damaged in an accident.
- Comprehensive coverage: Covers repairs to the covered car when it's damaged by an event other than an accident, such as weather or theft.
Most states require you to have at least liability coverage to drive a vehicle, and you may be required to carry comprehensive and collision coverage if you have an auto loan or lease. When there's an accident or claim:
- The owner's policy is generally the primary coverage. The owner's comprehensive, collision and liability coverage will generally be the first insurance coverage to kick in after an accident. For example, if your friend borrows your car and causes an accident, you may need to file a claim with your insurance company. The claim could increase your premiums even if you weren't in the car at the time.
- The driver's insurance may offer secondary coverage. Secondary car insurance can cover costs when the primary insurance doesn't cover the type of claim or when the claim exceeds the primary insurance's limits. For example, if your friend's accident causes $50,000 worth of damage and your policy only has $30,000 worth of liability coverage, their auto policy might cover the remaining $20,000.
Additionally, you might be required or able to purchase personal injury protection (PIP) insurance that covers accident-related medical expenses. PIP may cover drivers and passengers of the insured car, and follow the insured people when they're not in the vehicle. For example, you might be able to file a claim for medical expenses if you or your spouse are hit by a car while riding a bike.
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Exceptions
There are a few circumstances when your car insurance might not cover someone who borrows your car, and when your insurance follows you as primary coverage when you're driving someone else's car.
- You rent a vehicle. Your auto insurance might follow you if you rent a car in the U.S. or Canada. If you don't want to potentially have to file a claim with your insurance, you could purchase rental car insurance or pay with a credit card that offers primary coverage.
- The vehicle is used for business purposes. Auto insurance generally doesn't provide coverage when the vehicle is used for business purposes, such as gig work doing deliveries or driving passengers. The exclusion can apply whether you or someone you let drive your vehicle uses it for business.
- Someone drives the vehicle without the owner's permission. If someone steals your car or drives it without your permission, their insurance might be the primary coverage instead of yours. However, you might still want to file a claim if your car is damaged and the driver doesn't have enough, or any, coverage.
- The policy specifically excludes someone. You might want to exclude someone from your auto policy, such as a household member who has a poor driving record or DUI. Your insurance won't cover the person even if you give them permission to drive your car.
- You have a named-driver policy. Standard auto insurance policies usually cover people who have permission to drive the car. But there are also named-driver policies that only cover the people listed on the policy. These can cost less than standard policies because they don't cover "permissive drivers."
- Someone should be, but isn't, an insured driver on the vehicle. In some cases, your insurance might not provide coverage if someone who should be on your policy, but isn't, drives your car. For example, if your roommate regularly drives your car but you haven't added them to the policy, they may not be covered in an accident.
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Who Should Be Listed on My Car Insurance Policy?
As the owner of the vehicle, you'll likely be the one who shops for insurance, pays for the policy and is the principal (or primary) driver. However, you should generally list other regular drivers on your policy, including:
- Family members who live in the same home
- Roommates, including significant others, who regularly drive the car
- Other people who regularly drive the car and don't live with you, such as a nanny or a friend who lives down the block and shares your car
You generally don't need to list someone who rarely drives the car, such as a relative who visits once or twice a year.
Are You Liable if Someone Borrows Your Car and Gets in an Accident?
As the vehicle's owner, you may be liable for at-fault claims—and other claims in no-fault states—when the person you let borrow your car gets in an accident. In other words, you may need to file a claim with your insurance company, pay the deductible and potentially deal with higher premiums.
In some states, auto insurers can decrease the liability coverage limits for permissive drivers. If your insurance doesn't cover an entire liability claim, the driver's insurance may be secondary.
When the driver doesn't have insurance, or your combined coverages aren't high enough, the specifics of the situation could determine whether you or the driver are responsible for the excess expenses.
You also could be liable if you let someone drive your car when you know they shouldn't be driving, perhaps because they don't have a license or are intoxicated—or if the person gets in an accident while doing something illegal, such as texting while driving. In these situations, your insurance company might deny your claim, but you could still be personally liable.
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The Bottom Line
Car insurance generally follows the car and covers drivers who have permission to drive the vehicle. However, some types of coverage might follow you when you're driving someone else's car. And there are exceptions that could keep your policy from covering claims when someone else is driving, even if you're ultimately liable for the expense.
Because so many specifics can depend on your policy, state laws and the incident, it may be best to ask your insurance agent if you have questions about what your policy will cover.