You’ve probably experienced this pattern if you were a teenager. The time comes for your boy to get his learner’s permit and start driving. He passes the driving exam after a few attempts. Then he gets his driver’s license. He tries to buy Discount Auto Insurance but realizes that he cannot afford it. Your insurer will inform you about your new enthusiastic driver and you decide to pay. He will be covered by your vehicle insurance policy through high school, college graduation, and back home. He eventually grows up and decides to move out on his own. Perhaps he decides to move to a place with good public transit, but his first job isn’t enough to cover all his expenses and allow him to afford an automobile. He decides to go without an automobile for now.
He finally has the nerve to ask the girl in accounting he was feigning with. He decides to ask his best friend to lend him his car. He agrees to let his friend borrow the car, providing he fills it with gas and buys him a sandwich. Your Don Wan, a young man, picks up his friend and pulls onto busy 5th Ave. A BMW is then rear-ended. He is confused and throws the vehicle in reverse. He has two questions in his head. 2) Does his friend[spin] own [spin]vehicle coverage to cover his first date with a dream girl accountant?
Bad news for Don Wan: Your Don Wan policy is cancelled for non-payment after the girl hails a taxi and her friend misses their last insurance payment. A lightbulb goes off: Am I still covered by my auto insurance? Maybe their insurance policy covers the repairs.
Each insurance policy includes specific information about who is covered. According to the Insurance Services Office’s standard Personal Auto Policy, the first insured and family members are covered for any vehicle owned, maintained or used. Perhaps Don Wan was lucky. Maybe not.
Every car insurance policy has a defined definition of “family member”. This is an individual who is related to the first named insured on the policy. Family members must be related by blood, marriage, or adoption. They must also reside in the insured primary residence. Young Don Wan, who left your home when he began his career, met his wife, and borrowed a car from his friends, uninsured.
A California court decided in 1975 that an adult son living on his own, but separate street from his parents and who relied on them financially for support, was not considered a resident and therefore wasn’t covered by their car insurance policy.
These rules are not universal. Courts have recognized that college-age children, even if they live in college, are still considered to be residents of their parents’ home. A resident is a person who lives in the home of their parents and pays rent.
The break in coverage occurs when the child moves away permanently. Even if your child does not own a vehicle, they should get free insurance quotes for a policy that covers a named non-owner vehicle. This will cover them for any injuries or damage they may sustain while renting or borrowing an automobile.
Even though your Don Wans date would most likely have ended in any case, it would have saved him a lot of headaches and money.
