When you travel by land, sometimes, it cannot be avoided to have mishaps along the way. According to the National Highway Traffic Safety Administration (NHTSA), their early estimate of traffic accidents for 2024 projected 39,345 fatalities.
Figuring out whose insurance covers a borrowed car could get so confusing. Usually, if the owner allows you to drive their vehicle, their insurance is the first line of defense.
But what if the repair costs exceed the limits of coverage? Then your insurance can come into being. It is critical to have an understanding of how these two types of policies interact.
Let us explore the details regarding insurance policies so everything becomes clear to you about your obligations in this situation.
Understanding Liability Coverage
When you borrow a car, how much do you trust that you have liability coverage? This is an important aspect to understand.
Liability coverage protects you in case they cause damage to another’s property or injury to another person while driving the borrowed vehicle. You must ascertain whether the car owner’s insurance policy provides for you as a driver. If it does not, then all monetary compensation for accidents in which you get involved becomes your responsibility.
According to FL insurance claims lawyer John David Ameen, each policy has specific limits on how much they will pay out. Always conduct a check on these limits since they may be insufficient. If you think they will not cover you adequately, you can buy additional coverage for yourself.
Be aware of your state’s rules, as they are vastly different from one to another with regard to the issue of borrowed vehicles.
Having a clear grasp of your liability coverage bears a great deal of weight in preventing unwanted expenses.
The Role of the Borrower’s Insurance
When borrowing a car, you may prioritize the car owner’s insurance, but your insurance may also play a role in providing adequate coverage.
When a personal auto policy is active for the driver, the coverage automatically applies to the vehicle being driven, including any borrowed vehicles. For instance, in the case you had an accident, your car insurance might cover the expenses of the damage done up to the policy limits.
It would be wiser to read the insurance policy thoroughly and to check whether the coverage provided is identical under all policies. If you have collision and comprehensive coverage, it can pay for borrowed car repairs.
Your coverage for liability might also protect you from damages you cause to other parties. Always know the specifics of your own policy so you won’t be caught in an unpleasant situation when you go into someone else’s ride.
The Owner’s Insurance Policy
One thing that maybe should enter your mind when borrowing a car is its insurance. Normally, the insurance of an owner of the car may pay for damages when compensating for damage occasioned to another person’s car. Keep in mind that the particulars of the owner’s insurance policy will determine if the incident is covered by the insurance.
You need to be sure that the owner’s liability insurance has a permissive use clause, which commonly grants another person permission to drive the vehicle. The owner’s liability coverage usually protects the driver from most out-of-pocket costs, with the driver responsible only for smaller expenses. Bear in mind that your insurance may also apply if damages exceed the policy limits or if state law places restrictions.
Prior to borrowing the car, you should go through all the listed details with the owner so that both of you are on the same page in the unfortunate event of an accident.
State Laws and Regulations
State laws differ greatly in respect of car borrowing so it is very important to know the state laws.
In an accident, the insurance of the car owner is the primary one to be called into effect. But in some states with permissive use laws, the insurance may go to cover an innocent driver. In other states, coverage may be denied altogether if the car owner did not explicitly give you permission to drive the vehicle.
The limits and requirements of liability insurance vary, so it is always wise to be conscious of the minimum insurance standards applicable in the respective state.
It is also important to recognize what might happen if the borrowed vehicle is not insured at all. Check all the laws in your state to confirm coverage so you do not face any surprises in liability.
Steps to Take After an Accident
A fast response is needed in case an accident occurs while one is driving a borrowed vehicle. Look for any injury. If any is found or suspected, and the injured person can be moved without further injury, call the emergency medical services immediately.
Exchange of information should take place between drivers with names, phone numbers, and insurance details. Take away pictures of the accident site, vehicle damages, and road conditions involved.
Inform the car owner about the accident and share the very same details with them. An important thing to do is to call your insurer and report the incident, no matter if you were at fault or not.
Write down or document any relevant conversations, claims filed, and so forth. These records will serve to protect you and help ease the entire situation.
