I know you were promised pizza and beer to let them borrow your truck on moving day, but let’s find out if you are covered.
Most people have an idea of what’s covered and not covered under their various insurance policies. It seems at Goodlad & Swank, we get a lot of questions about when it comes time to borrow or loan a car. People, in particular pickup truck owners, get asked a whole lot to either help friends or family move or let them borrow their vehicle.
Now that the weather is warming up you might be looking to borrow your neighbor’s truck for a home-improvement project trip to Home Depot or a long overdue trip to the local landfill. Maybe, Cousin Michael, is moving from an apartment to a house he just purchased? We thought this is a great time to provide a little more information on how this would affect your auto insurance.
Generally, insurance coverage follows the vehicle rather than the driver. So in most instances, as long as the owner of the car has insurance, it’s covered even if someone other than the owner is driving it — as long as they have the owner’s permission.
The borrower’s insurance is considered secondary, meaning that in the event of an accident, it could apply if the owner’s insurance is insufficient to cover the damage fully.
It’s important to note that there are some exceptions to what is called “permissive use” coverage. For example, permission must be given by the owner, unless the borrower has a reasonable belief that they are allowed to use the car. However, the borrower cannot give permission to someone else. So if your teenager allows one of his or her friends to drive your car to Gulfcoast Town Center to see a movie, your coverage likely won’t apply.
Coverage might also be denied if the borrower operates the vehicle negligently or criminally. And if the borrower is using your car for business purposes, your personal auto policy likely won’t cover that.
If you have a regular long-term arrangement to either borrow or lend a car, the borrower should probably be added to the owner’s personal auto policy. Those who don’t own a car, but often borrow one, might also consider “named non-owner coverage,” an endorsement that provides bodily injury and property damage liability, uninsured motorists coverage, and more.
Ultimately, it’s usually safe to loan your friend your car for occasional errands or projects. And the same goes for borrowing a car. Just make sure it’s for “normal” use. You’ll want to confirm that the car has coverage and that your insurance, whether you’re the owner or borrower, will apply.
Feel free to give us a call at Goodlad & Swank Insurance if you have any questions — after all; you don’t want to wait until after an accident to get answers!