Borrowing Cars: Insurance Coverage Explained

“Can I borrow your car?” If a friend asks this, you might wonder about insurance coverage if they have an accident. Generally, if someone in your household borrows your car, they’re covered unless excluded. It’s often required to include everyone in your household on your insurance.

For friends or family who don’t live with you but borrow your car occasionally, permissive use typically applies. As long as you give them permission, they’re covered by your policy.

If your friend causes damage exceeding your policy limits, your policy pays first. If it’s not enough, the borrower’s policy covers the rest.

For example, if your policy covers $250,000 for injuries and your friend’s covers $100,000, your policy pays up to $250,000, and your friend’s covers the rest.

Your insurance is also primary for damage to the car, but the borrower’s insurance can cover the difference in deductibles.

Anyone borrowing your car must have your permission for coverage. If they reasonably believe they can use your car, they’re likely covered.

Before borrowing a car, ensure you have permission, the owner has insurance, and check if your insurance covers damages not covered by the owner’s policy.

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