Your friend’s car is in the shop, so he asks you if he can borrow yours for a few hours to run an errand. You reluctantly agree, hand him the keys, and watch him pull away, wondering if you made a wise decision. Spoiler alert – according to your car insurance carrier, you didn’t.
As luck would have it, on his way back, your friend takes out a parked car and a fire hydrant while texting his girlfriend in Omaha. Of course, you’re glad to find out your friend’s okay, but the parked car he hit is severely damaged and your car’s front end is completely hammered. Now, you’re wondering…who’s going to pay for this terrible mess? Most people believe the driver of a borrowed car, if insured, is liable for an accident he caused, but that just may not be the case – here’s why.
Contrary to popular belief, “the insurance follows the vehicle.” In most states, laws are on the books that require the owner of the vehicle involved in an accident for which they are at fault to be responsible in that particular situation. Every year in the United States, there are 6 million car accidents, in which nearly 3 million people are injured, and 42,000 die. And, unfortunately, for you, your friend just became part of the problem at your expense. You’re picking up the tab for his carelessness, and there’s isn’t much that you can do about it.
The general rule of thumb is that, if someone borrows your car, they’ve done so with your permission, and they’re going to be considered an insured person under your policy. That’s assuming your friend used your car reasonably and safely within the scope of that permission. That may not be the case given he was texting. Even if he has his own car insurance, damage from the accident will most likely still be your problem. Should the damages in the accident far exceed the limits of your policy and your car insurance has been exhausted, then the victim typically will turn to the borrower of your car for money.
But, that may not be the end of your troubles. If your car insurance company pays the claim on the accident, you, as the owner, can expect higher premiums. As far as your insurer’s concerned, the vehicle attached to the claim is what matters, not the driver. And, in a worst case scenario, the fact your friend had his accident while texting – if that’s in the police report – your carrier could simply decide not to pay. Anyway you look at it, an innocent gesture could wind up costing you dearly. That’s why, the next time a friend asks to borrow your car, think about the risks.
Always keep in mind that states may operate by different rules and regulations on car insurance. Likewise, for car insurance companies – they may differ in their policies when dealing with accidents resulting from lending your car to someone who is not listed in your policy as the primary driver.
When it comes to saving money, don’t say no. Check to make sure you’re getting the best rate on your car insurance. Why not get a free car insurance quote today?
Have you ever loaned your car to someone who wrecked it? Feel free to share your thoughts in the comments section below.