September 29th, 2014
While you may be insured to drive your car, what happens if you're driving someone else's? The issue comes up quite frequently, whether you lend your car to a friend for the day or borrow a car to get to work. While it is perfectly legal to drive another car, whether or not you are insured is a different matter.
State laws regarding minimum required insurance differ, but looking at comprehensive auto insurance in general, the rule is as such: Insurance follows the car, not the driver, according to the Claims Journal.
While every case is different, the industry standard is that if you lend your car to someone, you are also lending your car insurance for the time being. It doesn't matter who is driving the car, just the fact that the car itself is insured. This means that if you get in a wreck while driving a friend's car, then your friend's insurance will pay for it.
There are other instances where the insurance question becomes harder to determine. For example, if your friend's insurance policy has limits, then what happens if the damages are greater than the policy limits?
If a limit is reached, then the remaining costs will fall to you and your insurance. Your insurance will be used as a secondary source of coverage, according to Esurance. If you do not have insurance, then you or your friend will have to pay the costs out of your own pockets.
It is important to check with your insurance company to see who and what is actually covered if you intend to loan your car or to drive a borrowed one. In the event of a severe accident, damages and expenses will have to be paid for somehow. If you fall through the cracks and don't have the proper insurance, then you could be left footing the bill. Also, any accidents that involve your car will likely increase your auto insurance rates - even if you were not the one driving.