Non-owner car insurance, also known in the industry as non-driver insurance, offers liability coverage when you’re driving a car you don’t own and you cause an accident. Just like regular liability insurance, non-owner car insurance covers vehicle repairs and medical care for the other driver involved in the accident.
What is Covered under a Non-Owner Car Insurance Policy?
While non-owner coverage provides liability coverage in an at-fault accident, you can add supplementals to your policy for additional protection. According to NerdWallet, a non-owner car insurance policy can include the following:
- Protection Coverage– This type of coverage will pay for your personal medical care if you sustain injuries in an accident.
- Rental Car Liability Coverage – This coverage is also similar to regular liability insurance but is only active when you’re driving a rental car.
- Uninsured/Underinsured Motorist Protection – If you sustain injuries in an accident caused by an uninsured or underinsured motorist, this coverage will pay for your medical care.
Should You Purchase Non-Owner Car Insurance?
While most states require you to purchase a minimum amount of liability coverage, non-owner car insurance is optional. NerdWallet recommends that you purchase a non-owner insurance policy if you do any of the following:
- Frequently rent cars. Carrying an annual non-owner car insurance policy can end up being more affordable than purchasing rental car insurance from the rental company every time you rent a car. If you drive a rental car more than 50 days a year, rental car insurance will cost more than the annual price of a non-owner policy. Be sure to confirm that your non-owner policy covers rental cars. Keep in mind that if your credit card company offers rental car insurance, it doesn’t protect you from liability costs. However, if you combine your non-owner liability policy with your credit card insurance, this amounts to comprehensive coverage.
- Frequently borrow someone else’s car. If you’re always borrowing a friend’s car, non-owner car insurance is a good investment. You don’t have to worry about whether your friend’s insurance will cover you or if your friend’s liability coverage is high enough to protect you from having to pay out of pocket. Just remember that a non-owner car insurance policy usually doesn’t offer coverage if you borrow a car from someone you live with. If you’re constantly borrowing a family member’s car or roommate’s car, it makes more sense to have them add you to their policy.
- Don’t drive for an extended period of time. Suppose you don’t need a regular insurance policy because you don’t own a car or you won’t be driving for an extended period of time. In that case, a non-owner car insurance policy can prevent gaps in your insurance history. This is something to keep in mind if you do plan on purchasing regular car insurance in the future because gaps can trigger an increase in rates. A non-owner car insurance policy is often an affordable option for military members on deployment.
- Regularly use car-sharing services. While car-sharing services typically include the state’s minimum amount of liability coverage as part of the rental fee, drivers are often required to pay an additional damage fee for the coverage to kick in. You can save money by carrying a non-owner policy.
- Go without a car for periods of time. Suppose you’re temporarily between vehicles and plan on buying a new one. In that case, a non-owner policy is an affordable way to maintain your status as a long-term insurance customer, which will help you get lower rates when you buy owner’s insurance. Non-owner car insurance will also give you coverage when you’re test-driving vehicles.
- Need your insurance company to file an SR-22 form. If you have a serious conviction on your driving record, such as a DUI, and you need your driver’s license reinstated, you’ll need an SR-22 form from your insurance company. This form proves that you have insurance. Purchasing a non-owner policy is an easier and more affordable way to meet your state’s insurance requirements.
- Applying for a new driver’s license. Some states require you to have some sort of liability insurance when applying for a new driver’s license or reinstating a lapsed driver’s license. Again, a non-owner policy is a more affordable way to prove you half insurance.
How Much Does Non-Owner Car Insurance Cost?
According to a rate analysis conducted by Insurance.com, the average cost for a non-owner car insurance policy is $474 a year. Here is what the leading car insurance companies typically charge for a non-owner policy:
- GEICO – $311 a year
- State Farm – $408 a year
- Farmers – $521 a year
- Progressive – $576 a year
- Allstate – $638 a year
- Nationwide – $677 a year
As Insurance.com points out, your individual rate may vary depending on your coverage limits, location, and how often you drive. If you have violations on your driving record, your insurance company may also require you to purchase a high-risk auto insurance policy. An insurance company will classify you as a high-risk driver if your record includes any of the following:
- A DUI/DWI conviction
- Reckless driving citations
- Multiple traffic offenses within a short period of time
- Driving without insurance
If you have a clean driving record, the process for buying a non-owner car insurance policy is pretty straightforward. You’ll need to provide the insurance company your driver’s license number and method of payment. Your insurance company can send your proof of insurance by email, so you’ll have it almost immediately after purchase.
Disadvantages of Non-Owner Car Insurance
If you’re thinking about purchasing a non-owner car insurance policy, there are a few things you should keep in mind. As ValuePenguin points out, a non-owner car insurance policy is assigned to the driver, not the vehicle. That means your policy won’t cover any damage to the car your driving.
It also won’t cover your medical care if you’re injured because it’s a liability policy that only covers the other driver. You’ll have to add a personal injury protection supplement if you want injury coverage for yourself. Non-owner insurance is purchased on a per-person basis, so it won’t cover your spouse or other family members.
Now that you know the benefits and disadvantages of non-owner car insurance, you can decide if it’s right for you.
Sources:
Non-Owner Car Insurance: Where to Buy and What It Covers
Non Owner Car Insurance: What Is It and Who Should Have It?
Should I Get Rental Car Insurance?
Can I Get Car Insurance with a Suspended License?
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