Even if you’ve had car insurance for years, figuring out when you are and aren’t covered by your auto insurance can still be a tricky business. One common question that tends to come up is whether your auto insurance follows you or your car.
As with most insurance-related questions, the answer is slightly more complicated than one or the other. But, in general, car insurance tends to follow the cars it covers rather than the driver.
Does insurance follow the car or the driver?
For the most part, car insurance follows the car listed on the policy. If someone else borrows your car, in a way, they’re borrowing your car insurance too. At least, that is, if they’re driving your car with your permission. When someone drives your car with your approval, they are covered under what is called permissive use.
Whenever someone else is driving your car with your permission, yours is the primary car insurance. That means that if your friend, cousin, neighbor, co-worker or other type of pal is driving your car and gets in an accident, your car insurance will cover the damage in much the same way as if you were driving, although coverage for other drivers may be more limited than the coverage when you’re at the wheel.
If the driver who borrowed your car causes an accident, your liability coverage will pay for damage or injury they caused to someone else. And your collision coverage would pay for damage to your own vehicle from the accident. The other driver is only responsible for whatever your auto policy doesn’t cover.
When does car insurance not follow the car?
There are some exceptions to the rule that your car insurance follows your car, though. If you lend your car out to a driver without a license, or to someone who then drives it under the influence of drugs or alcohol, your insurance may not cover damage from an accident they cause. Other times when your car insurance doesn’t follow your car include:
1. Non-permissive use and excluded drivers
If someone borrows your car without your permission and causes an accident, they’re liable for the damage — but non-permissive use can be hard to prove to your insurance provider.
And if someone who is listed as an excluded driver on your policy — that is, they’re expressly excluded from your car insurance — drives your car, then your car insurance won’t cover any damage that happens while they’re driving.
→ Learn more about how to add a driver to your car insurance policy
2. Commercial use
If you allow someone else to drive your car for business or commercial purposes — like for ride-sharing or delivery jobs — your auto insurance policy won’t cover them. A standard auto insurance policy doesn’t cover business-use, so if you drive for ride-sharing companies or use your car primarily for business purposes and not personal use, you’ll need a commercial auto insurance policy.
3. Unlicensed drivers or drivers with a suspended license
Your car insurance won’t extend coverage to non-licensed drivers or drivers with a suspended license. If someone is driving your car without a current, valid driver's license, they may face fines and you may too.
When does car insurance follow the driver?
Car insurance generally follows the car, but insurance is never black and white. There are some cases when certain types of coverage do follow the driver too.
1. When you rent a car
Depending on your policy, your car insurance may extend coverage to rental cars. That means if you get into an accident, your car insurance liability coverage will cover you in the same way it would if you were driving your own car — paying out for any damage or injury that you’re liable for. And your policy’s collision and comprehensive coverage may cover damage to the rental car itself.
2. Secondary insurance
If a friend borrows your car and causes an accident, your auto insurance is the primary insurance, but if your friend has their own insurance, that will serve as the secondary insurance. So if the damage caused in the accident exceeds the limits of your policy’s liability coverage, then your friend’s own liability insurance may cover the rest of the costs.
That’s why it can be risky to lend your car out to someone who doesn’t have car insurance of their own. Even though your car insurance follows your car, so to speak, if your buddy causes damage that exceeds your coverage limit and they have no insurance of their own, then you could wind up liable for paying out of pocket for those costs.
→ Learn more about when your car insurance covers other drivers
3. Medical payments coverage
Medical payments coverage, or “med pay,” is an option coverage available in many states that covers injuries to you or your passengers after a car accident. But med pay coverage doesn’t just cover you if you’re in an accident in your own car — it can also pay your medical bills if you’re in a car accident while driving a rental car, or even if you’re a pedestrian and you’re hit by a car.
Frequently asked questions
What happens if someone gets in an accident while driving my car?
If someone gets into a car accident while borrowing your car — and they had your permission to drive it — your policy’s liability coverage would pay for injury and damage that they caused to any other drivers and their vehicles. If you have collision coverage, your policy will pay for any damage to your car, too.
Does my car insurance cover me when I drive another car?
This depends on the circumstances. For example, if you are renting a car, your car insurance may extend coverage while you drive the rental. But if you’re borrowing a friend's car, you’re covered under their auto insurance policy as the primary coverage. If you’re at-fault for an accident while borrowing your friend’s car, and the damage exceeds their policy’s coverage limits, your auto insurance will serve as secondary insurance and kick-in to pay for the remaining costs.
Do you need car insurance if you don’t own a car?
If you borrow cars or rent them here and there, you don’t need to go out and buy your own auto insurance policy. However, if you frequently borrow cars or rent them often, you may want to protect yourself with something called non-owner car insurance. Non-owner car insurance is a sort of stripped-down type of auto insurance, basically designed to ensure you have your own liability coverage. If you’re driving someone else’s car and cause an accident where the damages exceed the owner’s insurance limits, non-owner car insurance ensures you have liability coverage to cover those costs.
