Life is unpredictable and complicated! There might be a situation when you want to insure a vehicle that you do not own. Maybe you have received a car as a gift from one of your family members. Or maybe you are sharing a car with your roommate in college. Whatever your situation, you may wonder “Can I insure a car not in my name?” In most cases, the answer is no, even though there might be some exceptions that depend on the insurance company and the insurance policies they offer.
How Can I Insure a Car Not In My Name? There Are Several Ways To Do It
Getting insurance for a vehicle that you do not own might be challenging. There are several reasons for that. To fully understand why you should know how car insurance works.
Proving Insurance Interest Is Not Easy
Owning a car is one of the best ways to show that you have an insurance interest. If you cannot prove or explain why you want to insure a car, most insurance companies will refuse to sell you insurance due to the risk of fraud. However, there are still some companies that offer insurance policies to those who do not own cars. The main requirement is to be able to provide insurance interest.
The Claims Process Can be Difficult
The standard claims process looks like this. When a claim is paid, money disbursed by the insurance company is paid to the policyholder. Therefore, if you’re carrying car insurance for a vehicle you don’t own, you can receive a payout for the damage to the vehicle if you don’t have any financial stake. Then, the owner of the vehicle will not receive the money.
Ways To Insure A Car That Is Not In Your Name
The question “Can I insure a car not in my name” is controversial. So, moving forward let’s discuss several common situations when you have insurance for a vehicle not in your name.
Renting a Car
If you are renting a vehicle, there are several auto insurance options that you want to consider. If you carry auto insurance on another car, you may be able to transfer coverage limits to a car you want to rent. However, in most cases, your car insurance should include optional collision and comprehensive coverage to cover a rental vehicle. If it does not, your rented car will probably be left without proper coverage for repairs.
Another option is to purchase the car insurance that a rental company offers if you do not have your car insurance. Most rental companies require you to buy their insurance before they let you leave with their car if you cannot provide proof of your car insurance.
Driving a Friend or Family Member’s Car
If you are going to borrow a car from your friend or family member, they should contact their insurance company and inform them about it. In most cases, you will be covered even if you drive a car that is in someone else’s name. This is called ‘permissive use’. It refers to someone who is provided with regular access to an insured vehicle and who is related to the car’s owner. With permissive use, you are allowed to drive someone’s vehicle temporarily, and the insurance coverage will extend to you.
However, if you are going to borrow a car and drive it for an extended period, it is recommended to be listed as a driver on the car’s insurance policy. You may also want to add your garaging address to the policy so that the policy is rated correctly. If you borrow a car for an extended period and do not notify the insurance company, the company has the right to deny a claim for misrepresentation. Therefore, you need to be very honest and transparent.
Receiving a Vehicle as a Gift
Perhaps your parents or other relatives have bought a new car and decided to give you their old car as a gift. It is fine to keep the car insured, but it is important to consider certain things.
First of all, it depends on the age and individual situation. If you still live with your parents or those relatives who gave you the vehicle, and you are not 18 years old yet, you can keep the car insured on its previous owner. All you need to do is to add yourself as a car owner.
However, if you live at a different location and you’re 18+ years old, you have to purchase your policy. You can have your car insured by its previous owner for a few weeks. This is because most insurance companies understand that you need time to register the car and shop for auto insurance.
Driving a Company Vehicle
There might be a situation when you work for a company and are given a company car to drive. In most situations, your employer is the owner of the vehicle you have been provided with, which means that you do not have any insurance interest. Your employer can add you to their insurance policy as a driver. You cannot use your auto insurance to insure a company car because you do not own it.
The situation is different if you are a business owner and you buy a vehicle that you are going to use for business purposes. In this case, you will need to insure this car as a business vehicle rather than a personal one.
Things To Know About Car Insurance While Shopping Around
If you are currently shopping for car insurance, finding the perfect coverage addressing your insurance needs might be difficult, especially if you have never done it before. Here is a list of things you need to take into consideration and do while shopping for insurance:
Determine What Your Needs Are
Every driver and car owner has their own insurance needs. When you are looking for an insurance plan, you need to make sure that it provides enough coverage to protect you from financial loss in case of a serious car accident. You may compare different insurance plans to find the perfect one.
Gather All Your Necessary Information
To begin your shopping process, you need to gather some important information. This information includes your basic data (personal information about yourself), vehicle information (VINs, model, make, mileage information, safety features, etc.), information about the driver(s) (such as their driver’s license number for example), and previous insurance information.
Compare Different Policies and Ask For Available Discounts
Choose at least three different insurance companies and gather quotes from them. Each insurance company has its discounts available, so make sure to ask about them. There are also other ways to lower your premiums that you should know about. They will help you save some money. The first way is to raise your deductible. The higher deductible always means a lower monthly insurance payment. You can also install and add certain safety features to lower your premium. One of them is an anti-theft device that reduces the chances of your car being stolen. Also, if you take a defensive driving course, you will be able to get an instant discount from most insurance companies. Moreover, taking this course will help you become a better driver.
Choose the Best Way to Purchase Car Insurance
There are different ways to purchase car insurance. You can buy directly from an insurance company, a broker who usually works with multiple insurance carriers, or through a captive agent who works for a specific insurance company. If you do not know what insurance company, broker, or agent to choose, it is a good idea to ask your friends or family member for a recommendation.
