While you cannot cancel or remove an automobile from your policy, coverages can be reduced to state minimums while keeping registration active. Also consider getting comprehensive car coverage which protects against damage even while sitting idle.
Non-owner car insurance may be beneficial if you frequently rent or borrow cars; however, every situation differs.
1. You’re Covered as a Permissive Driver
When adding spouses, children, and any licensed drivers living in your household to an insurance policy with one driver listed as primary, they are usually considered permissive users; this may vary by insurer so always verify your policy to be sure.
Permissive use refers to when someone with your permission drives your car within its set parameters, your auto insurance will cover any accidents they might cause while doing so. While this feature is standard among most major providers, its application can become more complex when dealing with named driver policies or using your car for business.
If a friend borrows your car to drive it for Lyft, you would need to add them as a rideshare driver in order to cover them under your liability limits. Furthermore, if it is being used commercially (delivering goods or transporting passengers for hire), adding them as a named driver under collision coverage will help cover damage done to your vehicle by them.
Be sure to include comprehensive coverage in your policy as this protects against damages caused by non-moving events like vandalism and natural disasters; making sure that there are sufficient limits that meet the value of your car is essential.
If a friend borrows your car and hits a deer, for example, your comprehensive coverage might not be sufficient to pay off their auto loan if their insurer doesn’t cover it. Therefore, it may be prudent to increase comprehensive coverage limits when considering letting others drive it for business or pleasure – this should usually be accomplished quickly through speaking with your insurance agent; but ideally a knowledgeable agent should review your policy once purchased so as to identify which options best meet the individual circumstances involved.
2. You’re Covered as a Non-Driver
When borrowing someone else’s car, their owner’s policy typically provides coverage; but if you frequently borrow or rent cars yourself (or have family who do so) non-owner coverage may provide extra assurance of protection.
Save money on car insurance premiums when not driving by reducing to state minimum coverages when not in need. It is wise to maintain adequate coverage to prevent costly damages becoming your responsibility and possible legal penalties by cancelling or suspending coverage for your vehicle.
Most people find it impractical to drop coverage if you no longer drive their own or someone else’s vehicle, so an affidavit of nonuse may be appropriate – this official document shows your intentions not to drive this specific car and can help avoid cancellation penalties in the future.
When driving borrowed or rented cars frequently, you may be able to forgo purchasing a non-owner policy altogether; however, an umbrella policy could still provide maximum liability protection in case an SR-22 filing becomes necessary in the future.
When borrowing or renting a car, it’s smart to review its owner’s policy thoroughly for details on who’s covered under their car insurance plan. Your insurer should list who is covered; as long as you have permission from the owner and don’t exceed liability limits set out, their car policy should provide ample protection.
Check your drivers license is current, valid and not suspended or revoked before getting behind the wheel of any car – this can prevent being charged with driving without one – as well as your registration so it remains legal to drive legally, which could help get a better auto insurance deal later.
3. You’re Covered as an Excluded Driver
At times, you may want to exclude someone from your policy — often known as an excluded driver — because of poor driving habits or other issues that could increase their premiums. For instance, if an adult sibling or teenager at home have poor driving records that affect premiums negatively. High-risk drivers such as those involved in multiple accidents or speeding tickets incur greater payouts and costs from insurers than nonproblem drivers do and therefore raise rates accordingly.
Including an unsafe driver on your policy can result in cancellation or refusal, leading to fines, license suspension or even jail time – so to avoid these potentially severe consequences it is wise to ask your agent to exclude one driver.
Excluding drivers means no one in your household is allowed to drive your car; they can still use other people’s cars or obtain one on their own; if an excluded driver were to cause an accident while using yours, any damages and injuries sustained would fall solely onto you as the responsible party; operating without auto insurance could also have serious legal repercussions for them.
Reinstating an excluded driver on your plan requires either your or the insurance company’s request; some states don’t even permit them. Kansas, Michigan, New York, Virginia and Wisconsin do not permit named-driver exclusions other than for spouses.
Before making the decision to exclude drivers, it’s wise to consult your agent first in order to understand its implications. They can explain whether your premium will increase or decrease, and assist in finding solutions that suit everyone. They can even calculate how much it might cost for giving each driver their own individual plan if that makes more sense; plus provide you with a list of insurers that allow excluded drivers back onto policies.
4. You’re Covered as an Uninsured Driver
Many people own cars sitting idle in their garages for various reasons. It could be because they inherited it from a deceased family member but don’t understand its operation, or perhaps they work remotely and no longer require one. Whatever their motivation may be, maintaining some type of car insurance might still make financial sense.
If the vehicle owner allows you to borrow their car, their policy typically covers any damage you cause during that use, subject to its terms. For instance, if you borrow someone else’s car and rear-end another at a stoplight, their liability coverage should cover damage caused to both their own car as well as medical costs associated with injuries suffered by other drivers.
Though you should rely on uninsured/underinsured motorist coverage as part of your defense strategy, if the car owner’s liability limits don’t cover enough damages caused to others by you driving their car then uninsured/underinsured motorist may provide coverage in such instances – hence why it’s so essential that before driving anyone’s car it always pays to check its liability limits first.
Finally, your car owner’s policy does not provide coverage if you use it commercially – especially if driving for ridesharing services like Uber or Lyft. Many auto insurers now provide additional policies specifically for this activity that can be purchased at an extra cost.
Maintaining insurance for a car that you no longer drive can seem like a waste of money, especially if its costs exceed any savings from mileage discounts. If this is the case for you, consider reducing coverages on the vehicle to state minimum levels to save money; should you ever start driving again, raising coverages back up would likely make sense.
