Most of us have been in the scenario; a friend or relative wants to borrow your car, but you’re not sure about exactly what will happen should they be involved in an accident. Are they covered? If so, how? Do they use your insurance policy or theirs? Hopefully those questions will be answered for you.
If a friend or relative wants to borrow your vehicle, the first thing you should do is consider their driving record. If the person is close to you, you probably have a pretty good idea about what sort of driver they are. If you’ve ever ridden with them while they were driving and you found out that they were a speed demon, swerving in and out of traffic and scaring the heck out of you, it’s probably not a good idea to lend them your vehicle. If, on the other hand, the drive was fairly unmemorable, chances are it was uneventful and pleasant. Such a driver will probably take great care when driving your vehicle. If you really don’t know much about the person’s driving record or driving habits, it’s probably not a good idea to lend them your vehicle.
Once you have determined that the person is trustworthy enough to drive your vehicle, the next thing you should do is call your insurance company or agent. Simply ask them whether or not others are covered when driving your vehicle. Chances are, when you signed up for the auto insurance policy, the insurance company representative you were dealing with asked you whether or not you wanted any other people added to your policy, such as a spouse or other family member. These people are already covered on the auto insurance policy for your vehicle if you previously added them. If not, you should be able to add them right then and there.
On the other hand, if you don’t foresee this person driving your vehicle on a regular basis and don’t want to add them to your policy, you can simply ask the representative whether or not others are covered when driving your vehicle. Auto insurance policies do vary, but in general, the insurance stays with the vehicle. In other words, as long as the person borrowing the vehicle has a valid driver’s license and was willingly lent the vehicle, it is covered. Some policies, however, offer no such coverage, so it is always best to ask. Don’t forget that the premium agreement you made with the insurance company was based on your driving record, not someone else’s, and if you plan on lending your vehicle out to someone on a regular basis, you should add them to your policy. Depending on their record, however, your premium may increase.
The answer to the question of “How does auto insurance work when you loan your car to another?” is fairly simple. In most cases, the insurance follows the car. Any damage incurred when someone else is driving your vehicle is covered by your insurance policy and you are responsible for it. Any claim made will undoubtedly increase your premium, so consider well who you loan your vehicle out to.
Tags: accident, auto insurance, auto insurance coverage, auto insurance quotes, borrow, cheap car insurance, claim, coverage, discount auto insurance, insurance agent, insurance company, insurance policy, insurance rates, loan
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