While most times when drivers kindly offer their friends or family the temporary use of their car, nothing special or costly happens, and they receive the vehicle back without a scratch. However, life can be unpredictable, and even when it is not their fault, friends or family can end up in car accidents with your car. When this happens, it’s important to know how insurance will work regarding this accident, especially for those who have never been in any kind of accident or had to deal with an insurance company this much. To get an idea of what happens when other drivers get into accidents in your vehicle, follow our guide below.
Who’s Covered?
While policies can vary, it’s typical that anyone who lives in your home is covered while driving your vehicle unless they are intentionally excluded. Most times, everyone within the household is required to be on the car’s policy. When it comes to friends and family who do not live under your roof but sometimes use the car, they are usually covered when driving that car since permissive use—meaning anyone given permission is covered—usually applies with these cases.
Car Insurance Follows the Vehicle
Most people assume car insurance follows drivers, but it’s really the vehicles it follows. If car owners loan their cars out to non-excluded drivers, the owner’s car insurance would apply as primary coverage if an accident occurred, and the driver’s own insurance would be secondary.
When a friend with permissive use is in an accident in your vehicle, your liability coverage acts as the primary coverage, paying damages to the other driver. This means you must file an insurance claim, pay the deductible, and then accept any consequential insurance rates. If damages go beyond your limits, your friend’s insurance steps in with secondary coverage.
However, if the accident was the other driver’s fault, not your friend’s, coverage goes to the party at fault, leaving your insurance unaffected.
Exceptions
Excluded Drivers
If a driver has been excluded from your policy, your insurance does not pay any damages he or she incurs with the vehicle in the event of a crash. Also, while it varies by state, if the excluded driver did not receive permission from you to use the car, you may not be liable.
Non-Permissive Use
When cars are taken without your permission, owners could have a hard time proving they did not give permission, and they usually wind up paying. If it’s obvious you didn’t let someone drive your vehicle and a crash happens, however, one of several scenarios may occur:
Uninsured friend used vehicle: Expect your insurance to cover damages incurred by uninsured friends who crash your vehicle after not getting express permission.
Family or friend used vehicle: Expect your insurance to act as secondary coverage and your family member or friend’s coverage to pay first if he or she did not have your permission.
Theft: If a thief causes an accident with your car, you aren’t liable for injuries/damages to the other driver/vehicle, but your insurance would likely cover any damages to your vehicle.
When You’re Liable
Car owners can be considered liable if excluded drivers cause an accident with the owner’s vehicle, but you may also be sued for damages in the following situations:
- You allowed an impaired/intoxicated driver to operate your car.
- You let an unlicensed driver take your car onto the road.
Understand Your Coverage
Information is an important means of protecting your car, other drivers, and yourself, which includes knowing what’s covered on your policy, in the event of any type of accident, and what is prohibited. It also never hurts to talk to your agent about the terms of your policy as well as to an attorney in the event of an accident occurring with your vehicle.
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