Getting car insurance when you don’t own the vehicle outright can seem complicated. However, there are options available to get coverage even if the car is not in your name.
Can I insure a car that is not in my name?
Yes, it is possible to get car insurance on a vehicle that you do not own. There are a few common scenarios where this applies:
- You are leasing or financing the car – The leasing or financing company likely requires you to insure the vehicle even though they technically still own it.
- You are borrowing someone else’s car – You can get insurance coverage on a car you are borrowing from a friend or family member.
- The car is owned by your business – Your business can insure vehicles that are registered to the business but you drive regularly.
In all of these situations, the insurance follows the driver rather than the vehicle. Your insurance policy will cover you when driving that car, even though you don’t legally own it.
What type of insurance do I need?
The basic insurance coverage requirements are the same whether you own the car or not. Every state requires some level of liability insurance which covers damage you may cause to other people or vehicles. Many also require uninsured motorist coverage.
You will want to consider these main insurance coverages:
- Liability insurance – Covers injury or property damage you cause to others. Required in most states.
- Collision – Covers damage to the car from an accident.
- Comprehensive – Covers damage from weather, theft, vandalism, etc.
- Uninsured motorist – Covers your costs if you are hit by a driver with no insurance.
Comprehensive and collision coverage are optional but highly recommended if you want protection for the vehicle itself. Liability coverage is essential both to comply with state laws and protect your finances if you cause an accident.
How does the claims process work?
The claims process functions the same as if you owned the insured car. You would start by contacting your insurance company after an accident or incident causing damage. The insurer will investigate the claim, determine fault if applicable, and make payments directly for any covered repairs or medical bills.
Your insurance adjuster may need to coordinate with the owner of the car as well during the claims process. For example, the owner may receive any payments covering damage to the actual vehicle. But the process should function smoothly as long as you provide all required information upfront about the owner when initiating the policy.
What factors affect my insurance rates?
Insurers will consider several factors when determining your premiums for a non-owned car, including:
- Your driving record
- Your age, gender, marital status
- Where you live
- The car’s make, model, age
- Your credit score
- The car’s usage and annual mileage
These are the same factors that affect insurance rates for owned cars. Rates are based on your risk profile as a driver, not necessarily who owns the vehicle. However, insuring an extremely valuable car you borrow may increase your premiums.
Can I insure a car owned by my parents or family member?
Yes, you can get coverage on a car owned by a family member. This situation commonly applies when parents allow a young driver to use their vehicle. There are a few ways to structure the insurance:
- Add you as a driver – Your parents keep the car on their policy and add you as an additional insured driver. This is the simplest option.
- Get your own policy – You take out your own policy on the car in your name. Requires permission from the owner.
- Joint policy – You and the owner are both listed as insured drivers on the same policy.
The best option depends on your age, driving record, and insurance costs. Adding you as a driver to your parents’ policy tends to be cheapest but limits your control over the coverage.
What if I’m borrowing the car short-term?
You have a few options if you will only be using a borrowed car for a short time, like a few days or weeks:
- Existing coverage – Your current insurance may extend liability and some collision/comprehensive coverage to rental or borrowed cars for a time period.
- Rental car insurance – If borrowing from an agency or car sharing service they often offer insurance addons.
- Non-owner car insurance – You can get a specialized policy that provides liability coverage for short-term use of other vehicles.
Review your current policy and talk to your insurer about coverage for occasional use of other cars. This can provide protection without having to change policies.
How do I insure a company car that I regularly drive?
There are a few approaches if your employer provides you a company-owned vehicle:
- Corporate policy – The company covers the car under their commercial auto insurance policy and adds you as an insured driver.
- Personal policy – Your personal car insurance extends coverage to the company car you drive regularly.
- Hybrid approach – The company covers liability, while you get supplemental coverage like collision/comprehensive.
Talk to your employer about whether they expect you to get your own insurance on the company vehicle or if they plan to cover it. This should be agreed upon upfront.
Am I covered if I borrow a rental car?
Rental car companies are required in most states to provide some minimum level of insurance coverage. However, this coverage is usually basic and may not meet your needs. When renting a car, you have three options:
- Rental company coverage – Basic liability insurance that comes with the rental.
- Your own policy – Check whether it extends coverage to rental cars automatically.
- Rental insurance addons – Supplemental coverage like collision damage waiver offered by rental companies.
It’s recommended to either rely on your own insurer or purchase the rental company’s coverage addons for optimal protection.
What about car sharing services like Turo and Getaround?
Car sharing services and peer-to-peer rentals work a bit differently when it comes to insurance:
- The car owner’s insurance may or may not cover car sharing rentals. Check their individual policy.
- Services like Turo and Getaround provide liability coverage as backup.
- You can purchase additional coverage through the platforms for collision, comprehensive, etc.
- Your personal insurance likely does not cover these peer rentals.
Read the insurance information closely when renting from a car sharing service. Often their included liability is minimal, so purchased added coverage provides more protection.
What if the owner didn’t transfer the title yet after selling me the car?
This is a common scenario where someone purchases a used car but the seller delays transferring over the title. Even though you paid for the car, it is still technically in the previous owner’s name. There are a few options to insure it:
- Some insurers will cover a car you purchased for a short period even without the title.
- You can get non-owner car insurance in your name.
- Ask the seller to update their insurance listing you as a driver until the title transfers.
It’s recommended to transfer the title as soon as possible. But in the meantime, there are ways to get coverage on the car in your possession using the options above.
Can I insure a car stored on someone else’s property?
Yes, you can generally insure a car kept at another location as long as you have permission from the property owner. Examples include:
- Storing your classic car in a friend’s garage.
- Parking your vehicle in a paid storage facility.
- Keeping your car at a relative’s home.
Inform your insurer of the storage location and confirm it is acceptable. Rates may be higher if the car is stored somewhere other than your residence. But insurance can still be obtained as long as it is a legitimate storage situation.
What about insuring a car I’m financing but don’t have the title yet?
Financing a car purchase without immediately getting the new title in your name is common. You need to show proof of insurance to register the car and drive it home. There are two options:
- Your own non-owner insurance covers the drive home until the title transfers.
- The dealership may provide short-term insurance after the sale for this purpose.
Once you officially register the car, it should be added to your regular insurance policy even though the title comes later. Ask your insurer about coverage in the interim period right after a financed purchase.
Conclusion
Insuring cars you don’t own fully or titles are under someone else’s name is indeed possible in many situations. From borrowing family vehicles to financing cars without immediate title transfers, there are options to get coverage. The exact procedures vary based on your circumstance and insurer. But with the right policy, you can get protection on a car that is not technically in your name.
