Occasionally, you may be tempted to let a loved one drive your car. Perhaps you have purchased a new car and would like your friend to celebrate the experience with you. Unfortunately, disaster strikes. Your loved one is involved in an accident while driving your car. Perhaps you are unaware of how this impacts your car insurance policy. Here's a guide to explain how your car insurance may be impacted by someone else being involved in an accident while driving your car.
The general rule is that car insurance policies follow the car instead of the driver. There is a scenario where your car insurance may cover your friend if they were behind the wheel when damages occurred. The key is to add permissive use to your car insurance policy. A permissive user is someone you have listed on your policy who is allowed to use your vehicle while all your coverage remains active.
While you have the option to add a permissive user to your car insurance policy, there may be scenarios when your insurer declines to cover your car damage if someone is driving your car. Your claim will likely be denied if someone listed as an excluded driver was behind the wheel when damages occurred. Your claim may also be denied if your friend was driving a rental car when the accident happened. There are also potential exclusions based on the type of car insurance policy that you have. Named-driver-only policies prohibit policyholders from adding permissive users. Step-down policies only provide minimum liability coverage to permissive users, even if you have higher policy limits. There's also a strong chance your premiums will increase once you have filed the claim even though your friend was behind the wheel when the accident occurred.
If you drive your friend's car occasionally because you don't own a car, you can add non-owners car insurance. Some insurance companies mandate that a user purchase extra liability coverage and maintain a valid driver's license to purchase non-owners car insurance. Having non-owners car insurance helps stabilize your insurance rates. It's recommended that you avoid any gaps where you are not insured. If you have consistent gaps in coverage, your insurer may charge substantially higher premiums on your next car insurance policy. If you have been charged with a serious driving violation, you may be required to add an SR-22. An SR-22 is a certificate of insurance that covers drivers who have been convicted of reckless driving or driving under the influence.
Your car insurance policy covers you if someone steals your car and damages it in an accident. Your car insurance rates won't be impacted because you aren't responsible for the damage in this situation.
Your car insurance policy will cover any property damage or bodily injuries that occurred if your friend was listed on your policy as a permissive user. Be aware that you will likely have to cover a deductible. If your friend has insurance, their coverage will step in once you have reached your collision and liability coverage limits. You should also take photos of the damages and speak with the other parties involved in the crash to get their driver information.
It's recommended that you only let your friend drive your car in emergencies. However, your car insurance should cover you in a worst-case scenario as long as your friend is listed as a permissive user on your policy. If you have any questions, contact our team here at Jack Stone Insurance Agency, and we will assist you.
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