Friday, July 1, 2022

Who Is Covered Under My Auto Insurance

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Should You List Your Family Members Under Your Car Insurance Policy?

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Lending your car to a family member or friend happens frequently. It could be that your friend Paul needs to borrow your truck to pick up furniture or your girlfriend, Josie, needs your car to get to her part-time job across town on the weekend. But what happens if your vehicle is involved in an accident? And how many times can you lend your vehicle to someone before they need to be added as an occasional driver on your car insurance policy?

Before you hand over the keys, you should understand the possible implications of lending your car to others when it comes to your car insurance. If youre wondering who can drive my car under my insurance?, weve got answers.

How Much Is Car Insurance For A Teen Driver

One of the reasons that it makes more sense to add a teen driver to your policy rather than have them get their own standalone insurance is the high cost of car insurance for teens. Our analysis found that 17-year-old male drivers paid the highest average rates, at $7,207 per year.

But, assuming your child is a safe driver and maintains a clean record, their rates will drop every year until they turn 25, at which point it may be much more affordable for them to have their own car insurance policy.

What Happens When My Child Earns His/her Drivers License

Once your child earns his or her license you will be required to include that child on your insurance policy. Another option is for the child to get his own policy, but that may require him to purchase his own vehicle or have one registered in his name.

Regardless, its going to cost you or your child a significant amount of money because he is still young. Just as an example, a young man between the ages of 18 and 25 will pay the highest rates around because of his age and sex.

If your child is going to continue to live at home or count your address as his permanent address while away at college, dont try to get around adding him to your policy.

If you fail to tell your insurance company that hes earned his license they find out, they will most likely drop you at the time of your renewal as a result. When you shop around for new insurance, the fact that your son has his license will be discovered through a normal DMV search and youll pay for him anyway.

Furthermore, if you dont inform your car insurance company and your child has an accident, you may have your coverage dropped. Whats more, the auto insurance company may decline to cover the damages of the accident.

Insurance laws in almost every state allow car insurance companies to deny payment if you violate the terms of your policy. One of those terms is informing them when your children earn their drivers licenses.

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How Much Liability Coverage Do You Have

Liability coverage is required in almost all states, so you should have it. This pays for the other drivers injuries if youre at fault in an accident. It also covers damage you cause to other vehicles and property.

As long as you have a level of coverage that youre comfortable with, you can usually skip on purchasing the supplemental liability coverage.

But if you only have the state minimum limits for liability, it might be wise to buy the supplemental coverage for that extra protection. Itll ensure that youre properly covered if you get into a car accident.

What If A Friend Or Visiting Relative Is Driving My Car

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Now, what if a driver not on your policy has an accident while driving your car? Assuming that your friend is not specifically excluded on your auto policy and no other exclusions apply, when a friend borrows your car he or she would be covered under your auto insurance policy for most coverages. If your friend has his own auto insurance policy, that may also cover damages if they exceed your limits of liability. Your friends policy would also be the primary policy for coverages such as personal injury protection .

Even if you have comprehensive and collision, youll still have to pay your deductible amount before your insurance company will begin to pay for damages to your vehicle after a car accident. Typical deductibles range between $100 and $1,500. If your friend wrecks your car, you might want them to help out with this cost!

If you know that a friend or family member will be borrowing your car when they visit, your best option is to call your insurance provider and ask about the kind of coverage your policy provides when you permit another person to drive your car.

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What Does Gap Insurance Cover

When your car is stolen or destroyed, your car insurance will pay for the actual cash value of your car. If you loan or lease your car, and itâs totaled in an accident, you could end up owing more on your loan or lease than your carâs depreciated value. Gap insurance pays out the difference between the carâs actual cash value and the amount you still owe on the lease or loan.

Named Insured Has Broadest Coverage

Of the three types of insureds, you are afforded the broadest level of coverage. You are covered for any covered auto. Which autos are covered depends on the covered auto designation symbols that appear in the declarations section of your policy. This page will include small numbers near the various listed coverages to indicate what type of vehicle or individual that is covered.

For example, if symbol two appears next to liability coverage, you are covered for claims arising out of any auto you own. Likewise, if symbols eight and nine are shown, you are covered for claims arising from any auto you hire, as well as any auto you don’t own.

Note that you are covered even if you are not driving the auto when the accident occurs. This is important because employers are vicariously liableheld responsible fornegligent acts of their employees. If you are sued as a result of an auto accident caused by a negligent employee, you should be covered for the claim.

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How To Add Someone To Your Car Insurance Policy

Adding someone to your car insurance policy is a relatively easy process. Generally speaking, you should add all licensed family members in your household to your insurance policy. Most car insurance companies will allow you to add a new person to your policy either online or over the phone.

Before calling your insurance company, you should have some basic information on hand, like the new drivers full name, date of birth, Social Security Number and license number. Typically, adding a new driver to your policy is a simple process with just a few steps:

How to add someone to your car insurance policy

  • Contact your insurer and tell them youd like to add a driver to your policy

  • Provide any necessary information about the driver

  • Adjust your coverage if needed

  • Discuss your updated rates with a representative, so youre clear about what changes have been made and why

  • If your premium goes up significantly, ask about opportunities for savings or take some time to shop around and compare quotes with other companies

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    If your child is in college and living away from home, they can still stay on your auto insurance policy as long as your home is their primary residence. That said, you should talk to your insurance company if your child is taking a car with them to school, especially if they are going out-of-state. You might need to adjust your coverage according to that states regulations, and your premiums may change if one of your vehicles.

    If your child does not bring a car with them to college, you might be eligible for a discount, depending on your insurance company. Even if they arent driving regularly, you should still keep them as a named insured on your policy, especially if they plan on driving your vehicles when theyre home from school.

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    Are Other Household Members Covered Under My Auto Insurance

    The ex-boyfriend sleeping in your home office until he gets on his feet again? Your cousin whos in-between jobs and crashing on your couch? If theyre a licensed driver and theyre living in your house, you need to add them to your insurance policy.

    What if they dont have a clean driving record, and adding them would send your car insurance premiums through the roof? Ask your insurance company about listing them as an excluded driver. This specifically excludes them from coverage in your car insurance policy, keeping your rates lower.

    If someone drives your car on a regular basis, like a nanny, you should list them on your policyeven if they have their own insurance.

    Be honest when getting your car insurance quotes. Failing to list a driver that you should have disclosed could void your coverage if theyre in an accident while driving your car. Thats not worth it.

    Who Has To Pay The Storage Charges On My Damaged Auto When There Is A Dispute As To The Amount Of The Claim Payment

    The insurance company has to pay the storage charges until it makes a reasonable offer to settle your claim. If you dispute the amount of money offered by the company and the company changes its offer, this does not necessarily mean that the first offer was unreasonable. If you and your company disagree over what is reasonable, your policy has a process you can follow to work out the disagreement.

    It is important that you work with the company and stay in communication with them, even if you are in the middle of a dispute. If the company makes you a reasonable offer and you dont respond, you could be responsible for the storage fees if you leave your vehicle in storage.

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    You And Your Neighbor

    Another type of situation is if you occasionally borrow your neighbors car to get to work or do a chore. Whether or not you are covered by his insurance depends on how much you use his car and the reason for driving it. The specifics vary from state to state.

    If you use the car once every month or two, you are most likely covered. If you use the car for one or two days, you are probably covered. However, if you use it for a number of weeks at a time, you are probably not covered. The way around this is have your name added to his policy.

    It also matters why you are using the car. If you are using it on the job, then his insurance must be commercial auto or business insurance. As a rule, personal auto insurance doesnt cover you if you are driving for work related activities, whether it is delivering groceries or hauling roofing materials.

    What Is Car Insurance

    Is My Child Covered Under My Car Insurance

    An auto insurance policy is a contract between you and an insurance company – sometimes a local insurance company, sometimes nationwide. In exchange for paying a premium, the car insurance company promises to pay for specific car-related financial losses within the selected coverage limits that you may have during the term of the agreement. Basically, if you get in an accident, car insurance protects you from financial hardships that could result from damages, injuries, or lawsuits from other drivers. Most states require that you carry automobile liability insurance in certain minimum amounts. If you are at fault in an accident, the law requires that you pay the damages sustained by the person who is not at fault. These can include property damage, which is the cost to repair or replace any property that you have damaged.

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    Does My Car Insurance Cover Me When Driving Another Vehicle

    If youre specifically listed on the car owners insurance policy, youll be covered when driving that car even if its not your own. If youre not on the owners policy, applicable coverage will again depend on consent.

    Assuming the driver gave you consent to operate the vehicle or, at the very least, there is reasonable belief that you had permission to drive it, then youre probably covered. If you pay to drive the car , then this generally constitutes assumed permission as well.Here are some situations in which you would typically be covered under your auto policy:

    • Driving your parents vehicle with permission, assuming you are not listed as an excluded driver on their policy.
    • Borrowing a friends or family members car with permission while yours is being repaired.
    • Renting a car from a rental car company or the car-sharing marketplace.

    Does Your Insurance Cover You If You Borrow A Car

    The short answer is: Yes, in most instances.

    Lets say you borrow a friends car, or youve rented a car .

    In this case, your Lemonade Car policy will cover your liability while youre behind the wheel of the borrowed vehicle. If the owner of the car itself has their own policyand we certainly hope they do!that policy will typically pay out first in the event of a claim. Your Lemonade policy will then be back-up, essentially.

    Not all parts of your Lemonade Car policy extend to your use of a borrowed car, though.

    If youve got comprehensive and collision coverage, both of those will carry over. However, temporary transportation coverage will not. You also wont be able to take advantage of Lemonades roadside assistance services if youre driving a borrowed car.

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    Can My Insurance Company Deny A Claim For Damages To My Vehicle If The Principle Place Of Garaging Listed On My Application Is False

    Yes. They can deny a claim if any of the information on your application is false. The single most important thing you can do to protect yourself from a claim denial is to make sure that all of the information you give to your insurance company is complete and accurate.

    If you or someone on your behalf gives false, deceptive, misleading or incomplete information on any application and if that information increases the insurance company’s risk of loss, your company may refuse to pay claims under any or all of the Optional Insurance coverages of the policy. You must state where your car is garaged most of the time, regardless of your listed address. You must also list all the licensed drivers who are likely to drive your vehicle. This includes people who live with you who do not have their own auto insurance, and also people who use your car on any kind of regular basis.

    If you move after you fill out your initial application, you must tell your insurance company and the Registry of Motor Vehicles of your new address promptly.

    Can Someone Else Drive My Car

    Who Can Drive Under my Car Insurance?

    Discover what happens if someone else drives your car and gets into an accident.

    There are times in life when we need to let someone borrow our car, but we hesitate allowing them to use it because we dont know if we can, or if we should. We wonder:

    • Can my babysitter use my car to drive my kids to the swimming pool?
    • Can my friend drive my car?
    • Can my brother-in-law or other family member borrow my car for the weekend?
    • Can I drive someone else’s car?
    • Will my friends insurance cover any damages I cause while driving their vehicle?
    • Do irregular drivers need to be added to my policy?

    At the heart of it, we want to know, If we give them permission and they get into an accident, is it covered by my insurance? Is it legal for someone to drive my car who is not on my insurance policy?

    “Generally, it’s not a problem if they’re driving with your consent,” says Jeanne Salvatore, Senior Vice President of Public Affairs and consumer spokesperson for the Insurance Information Institute. “If it’s an occasional use, say I borrow your car to go pick up milk, and as long as permission has been verbally granted, you’ll typically be covered.”

    “When you have someone you employ, such as a nanny or a nurse, who will be a regular, additional driver in your household, contact your insurance agent about your policy,” Salvatore recommends. “He or she may need to be added to it.”

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    Insurance For A Teen Driver Who Doesnt Live With You

    Divorce or a teen moving out of your home can lead to complications with auto insurance. If your child stays with you regularly and has access to your vehicles, they should be on your car insurance. This is true even if your teen lives with another parent with car insurance. Thats because its likely your auto insurance company will assume your teen will drive your car while living with you.

    Car insurance always follows the car, not the driver. So, if your teen is in an accident while driving your vehicle, it will be your insurance that pays for any damage.

    Before We Roll Out Of Here

    Letting someone else behind the wheel of your car is a big deal. Whether its your spouse, kid, next door neighbor, or college bestie, be sure you fully understand your car insurance coverage, so you can hand them your keys with confidence.

    If you want more answers about whats covered by your car insurance policy first, check out our article about car insurance coverages here.

    Drive safe!

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