You’re home from college and need to borrow a friend’s car to get to work. Your girlfriend’s car is in the shop, so you offer to let her borrow yours until she gets her car back. But if you borrow or lend out your car, what happens in case of an accident? Will you still be protected?
Does car insurance follow the vehicle or the driver when lending or borrowing a vehicle? The answer isn’t entirely cut-and-dry, but it’s important to understand how insurance works and whose insurance rates might be affected by an accident.
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Car insurance usually follows the car, not the driver, but there are several exceptions to that which we’ll get to later.
In most cases, if your friend has their own car insurance but borrows your vehicle, their car insurance won’t cover an accident they have while driving your car. Instead, the insurance policy that you have on your vehicle would pay for repairs to your car, and unless you have coverage like accident forgiveness, your rates would increase because of that accident.
But that’s not always the case. Your state, insurance company, the people named on your policy, and whether you gave your friend permission to drive your vehicle will all impact how insurance works after an accident.
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Every car insurance policy handles vehicle sharing a little bit differently, so if you’re going to lend out your car or borrow someone else’s vehicle, it’s best to call your insurance company ahead of time. Ask the insurance provider about whether the driver will be covered in the situation.
If you plan to let someone in your household drive your vehicle regularly, add that person to your car insurance policy to ensure that they’re covered.
As a rule of thumb, if you’re borrowing a vehicle, make sure that you have consent from the driver, since this may make a difference in whether you’re covered by insurance or not. And if you plan to lend out your vehicle, be sure to give that driver consent, too.
If your insurance needs have changed or you’re looking to save money while adding more drivers onto your policy, take the time to shop around. Comparing quotes can help you find the insurance that best meets your needs at the best price. You can get free car insurance quotes today to start exploring your options.
Paige Cerulli Paige Cerulli is a freelance content writer and journalist who specializes in personal finance topics. She graduated from Westfield State University and brings more than a decade of professional writing experience to the ConsumerCoverage team. Paige’s work has appeared in outlets including USA Today, Business Insider, and more.
