I got my license at age 21, after I graduated from college/moved out of my parents’ home/moved to a new state. So I doubt very much that I was ever on their insurance plan.
On the other hand, I didn’t own a car till I was 26, which was the first time I bought insurance.
I drove a number of cars in between, including a few rentals (I am sure I was covered by their outrageously expensive insurance, especially considering my age at the time) along with cars belonging to friends and family members.
So – whose insurance was I driving on during those times? Theirs? No one’s? What if I’d totaled their car? Wiped out somebody else’s? Inflicted major injuries on myself or others? Was I actually covered at all? I think I don’t understand very well how car insurance actually works–
Thanks!
If you were given permission to drive the borrowed vehicles, you were covered by the car owner’s insurance.
Depends on what state you were driving in. In some state insurance follows the car and anyone who drives it. In other states individuals are required to have insurance even though they may not own a car. In Michigan the insurance follows the car, but in Ohio the individual needs to have insurance.
This was how two State Farm agents in both states explained it to me. I see a friend in Ohio, when she comes to Michigan she can drive my cars. When she is home in Ohio she is not allowed to drive my mother to the doctor in my moms car because she doesn’t have insurance (she is 44 and doesn’t own a car). I know people claim that in Ohio the insurance follows the car, but the way they law is actually written and interpreted makes it so the insurance follows the person; at least according to actual insurance agents I spoke with. The one in Ohio told me that if my mom knew that my friend didn’t have insurance and loaned her the car that State Farm would not cover any part of any accident that she was involved in within the borders of Ohio.
Its also possible that even when the insurance is on the car,
there is limitted scope to cover the driver. I’ve had an insurance policy that said “if the insured vehicle is with a repairer or mechanic, this insurance policy covers a similar replacement vehicle used by a listed driver”.
Also, insurance policies may list drivers and then have higher excess for, or total exclusion of , non-listed drivers.
I’ve seen it done by age brackets. Non-listed driver over 25 … covered but higher excess. 25 and under, not covered.
I am an insurance adjuster and like an above poster said, it depends completely on what state you’re in.
I work out of California so all my answers can only be considered correct in this state:
The insurance follows the car. So if you get in a car accident whoever owns the vehicle is whose insurance would be primary. Let’s say you’re driving your friend’s car and you hit a BMW pretty badly and there’s 15 thousand in damage. If his insurance policy only has 10 thousand property damage limits then his policy will be paid out and then yours would come into play and cover the rest.
If you were driving your car around and there wasn’t any insurance on it and you hit someone then you would be personally liable for the damages. That could mean anything from civil court to paying the insurance company back 15 bucks a month for a certain amount of time.
Don’t feel bad about not understanding car insurance. Most people don’t. If you have any questions let me know.
You have to pay extra for rental car company insurance, but if you rent at the counter they usually use salesman tricks to get you to buy it, so you might without being aware of it. In New York I was told “state law requires you to buy SLI”, and in Orlando I was asked. “So do you just want the standard CDW with this or do you want more coverage”. Rental insurance does have it’s place if you don’t have your own insurance or do but can’t handle the risk of loss of use or reduced value fees, but it’s a huge moneymaker for them which means it’s usually a bad deal for you.
I’d imagine a personal bankruptcy is often what happens if you total someone’s BMW without insurance.