“I’m Borrowing my Friend’s Car… Am I Covered?”

When it comes to insurance, most people think they have a pretty good idea of what is or isn’t covered by their policies. However, there are always a few subjects which tend to trip people up, including the details of insurance coverage when borrowing or loaning a car.

Whether you’re looking to borrow your neighbor’s truck for a home improvement project or a neighbor wants to borrow yours to drop off some old furniture at Goodwill, questions about liability are sure to cross your mind. If you (or your neighbor) get into an accident, whose insurance picks up the tab?

The short answer is, it’s usually the car’s owner. Insurance coverage tends to follow the vehicle rather than the driver, which basically means that it doesn’t matter who’s driving the car so long as the owner gave them permission to drive it.insurance coverage when borrowing or loaning a car

However, it’s worth noting that the borrower’s insurance is considered as being secondary. If the owner’s insurance policy isn’t enough to fully cover the damage, the remainder could come from the borrower’s policy.

Pretty straightforward, right? Here’s where it gets a bit tricky: There are some exceptions to “permissive use” coverage.

For example, permission must be given by the owner, unless the borrower has a reasonable belief that they’re allowed to use the car (such as having been allowed to borrow it frequently in the past). However, the borrower cannot give permission to somebody else. So if your teenager lets one of his or her friends borrow your car to grab a burger from Maggie McFly’s, your coverage likely won’t apply.

Coverage could also be denied if the borrower operates the vehicle in a negligent or criminal manner. And, if the borrower is using your car for business purposes, your personal auto policy probably won’t cover that.

If you have a regular long-term arrangement where you’re either borrowing or lending a car,  the smartest thing to do would be to add the borrower to the owner’s personal auto policy since it provides a greater guarantee of coverage. Those who don’t own a car, but often borrow one, might also consider “named non-owner coverage,” which is a kind of policy that provides bodily injury and property damage liability, uninsured motorists coverage, and more.

Ultimately, it’s usually safe to loan your friend your car for occasional errands or projects. And the same goes for borrowing a car. Just make sure it’s for “normal” use. You’ll want to confirm that the car has coverage and that your insurance coverage when borrowing or loaning a car will apply.

Any other questions? Feel free to give us a call at (203) 775-2564. After all —you don’t want to wait until after an accident to get answers!

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