Non-owner car insurance policies provide liability coverage for drivers who do not own a vehicle but may need or want coverage for driving other people’s automobiles, rental cars or other reasons. Non-owner vehicle insurance typically covers bodily injury and property damage liability. Bodily injury liability coverage helps pay for the medical expenses, lost wages, and legal fees of other people involved in an accident that you are responsible for. Property damage liability coverage helps cover the costs of repairing or replacing someone else’s property that you damage in an accident.
These policies typically fulfill state minimum coverage requirements and may also include Personal Injury Protection (PIP) or Medical Payments and Uninsured Motorist Coverage. These policies don’t provide Collision and Comprehensive coverage for the vehicle driven.
Non-owner car insurance policies usually provide secondary coverage to the vehicle owner’s liability coverage when driving someone else’s auto. But they can become primary if there isn’t any other liability policy in force, like in the case of rental cars.
Uses of Non Owner Vehicle Insurance
Such a policy might be for you if any of the below benefits appeals to you or it allows you to comply with any requirements.
- Proof of coverage: Licenses may be suspended or lost after serious traffic violations like DUI. A few states require SR-22 forms that act as proof. Regardless of having a vehicle or not, the state may still want proof of liability coverage to let you get your license back. It is a good solution to satisfy insurance requirements in such a case.
- Frequent renters: If you rent a vehicle more than 10 days in a year, savings may be enough to pay for this policy. These policies offer you liability coverage when driving a rental auto. You may still need to buy a rental car Collision Damage Waiver at either hire desk or from another source to remove financial responsibility from you in case the hired vehicle is damaged while in your possession.
- Extra asset protection solution: Non-owner automobile insurance is a good solution to supplement car-sharing service liability coverage, if you often use them. Once the vehicle owner’s liability coverage is exhausted, the driver would have to pay the rest of the damages out of pocket so it makes sense to arrange additional coverage.
- Driving someone else’s vehicle: You may want extra personal protection from third party liability claims even though vehicle owner’s insurance usually includes you as an occasional driver. In such cases, the vehicle owner’s policy would be the first to pay for damages and injuries caused by you. However, non-owner auto insurance policy comes into play as secondary coverage to deal with any shortfall once the primary limits are exhausted.
- Way of avoiding lapse in coverage: You may have sold your automobile and haven’t bought the next one yet. You can keep coverage going by cancelling an expensive policy for the sold car and buying usually cheaper non owner car insurance. This may be better than allowing a lapse. You may have to pay a lot more when you want to get a standard policy once again if there is a lapse in record. Besides, it has other benefits as discussed throughout the article. Often companies allow their existing policyholders to drop down to non owner policy even if they don’t usually offer non owner policies in the similar situations as above.
- Building history: You may be planning to buy an automobile in the near future. In the meantime, you may be renting or using friends’ cars. Finding cheap non-owner automobile insurance coverage would protect you and let you build insurance history at the same time.
- Peace of mind: These products are valuable not only for the financial assistance they may provide but also they offer peace of mind. Knowing you have something to fall back to may be worth a few hundred dollars you spend.
You may not need to have non-owner automobile insurance if you are a listed driver on someone else’s policy such as a partner’s, parent’s, friend’s or employer’s policies. You can still arrange it for the other benefits listed above, though.
Not many companies offer non owner car insurance and you may need to look for smaller or non-standard carriers. The General, Direct Auto Insurance, Dairyland and Kemper are some of the companies selling non-owner vehicle insurance. GEICO and State Farm are two of the larger companies offering these policies and Progressive may offer it to existing customers only.
The cost of non-owner vehicle insurance depends on factors such as your driving history, age, and location. Obtaining quotes from different insurers will help you determine the specific premium amount you would need to pay.