Should You Lend Your Vehicle?
Everyone needs a loaner car from time to time. Maybe your son's car doesn't start one morning, or you best friend's truck is in the shop. When someone asks to borrow your vehicle, should you say yes or will you be opening yourself up to serious liability issues? As a vehicle owner, you need to understand your financial exposure when you lend someone your car or truck.
The Insurance Trail
Many people believe that insurance follows the driver, but in most cases, the insurance follows the vehicle. If the driver has an accident that is their fault, your insurance will usually cover the accident, but you will be responsible for the deductible and any increase that results in your insurance premiums. If your insurance did not cover the amount of damage done, the driver's insurance would be secondary. Obviously, if the driver of the other car was at fault, their insurance would be liable.
Drivers
Any regular drivers of your vehicle should be listed on your insurance. If you neglect to do so, your insurance company may choose not to cover an accident because you have misrepresented how your vehicle is used. However, most occasional drivers will be covered under your insurance. In some instances, your policy may exclude drivers in order to keep your insurance rates lower. If you go ahead and lend your car to that driver and an accident occurs, you may be responsible for all the financial damage.
Borrowers
If you are the borrower, you need to be aware of the car's insured status. You may be uninsured and legally drive a car as long as that car is covered by the owner. If the car is not and you are ticketed for no insurance, the ticket will stay on your license, even if you have no car of your own to insure. If you have no car but frequently borrow others' vehicles, you should consider investing in a non-owner policy, if your state allows them. That way your driving status will be legal in spite of the car owner's lack of coverage.
Before lending your car to anyone, you should check with your insurance agent to make sure you have proper coverage for all drivers of your vehicle. Be sure to ask how your company handles accidents that involve someone not on your policy, and up your coverage, if necessary, to cover you for all possibilities.
For insurance quotes, contact a company such as Cornerstone Insurance Group.
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