Insure A Car That Is Not Yours

Do You Need To Insure A Car You Don’t Drive?

Unfortunately, the question of whether you must insure a car you don’t drive can’t be answered with a simple “yes” or “no.” Auto insurance requirements vary from state to state. However, in most state, you must carry at least basic coverage.

“As with most insurance questions, the initial answer is, ‘It depends.’ Mainly, it depends on if the car is financed or leased,” says David Miller, an independent insurance agent with The Plexus Groupe LLC in Deer Park, Ill.

How to Insure a Car That You’ve Financed

Miller says that if you took out a loan for your car, the lender typically requires you to insure it. That’s the case even if it sits in the driveway of your home for weeks and weeks.

Generally, the lender will insist on two basic types of coverage: comprehensive and collision. Both cover physical damage to your car.

“If you drop coverage on a financed car, the lender receives a copy of the cancellation notice. And then they send you a not-so-friendly reminder to maintain coverage,” Miller says. “If you ignore it, they will take out ‘forced placed’ coverage to protect their interest in the vehicle.”

When you lease your car, the insurance requirements are even more strict, according to Miller. A lease will specify that you not only purchase comprehensive and collision coverage but that you buy liability as well. The lease will designate the amount of liability coverage you must have. Plus, the maximum deductible permitted for comprehensive and collision coverage.

As with a loan, if you drop coverage for a leased car, the leasing company likely will make you pay for forced placed coverage. If you own your car outright, the laws of the state where your car is registered dictate the coverage you need.

SEE ALSO: How Much Car Insurance You Need to Buy

Here are some situations involving insurance for a car that you aren’t driving.

How to Insure a Car That You Store

Miller says some insurance companies will let you buy storage coverage if you be won’t driving a car for a certain amount of time. For instance, if you own a convertible, you could cancel collision coverage during the winter while it’s parked.

“This would still give you coverage if the garage burns down or your car is stolen,” Miller says.

How to Insure a Car While You’re on Vacation

Let’s say you’re heading to France for a two-week vacation. And while you’re outside the U.S., no one will be driving the car. However, Miller says, you’ll have to keep coverage if it’s required where you live. That’s because the insurer won’t allow you to temporarily cancel coverage and then reinstate it after your trip.

“It is too expensive for the company and your agent to process multiple requests to drop coverage,” Miller says.

How to Insure a Car That You Borrow

What happens when you drive a car that doesn’t belong to you? Typically, the policy for the car should cover you. For instance, if you borrow your sister’s or someone else’s car with permission.

However, if you frequently drive your sister’s car, it’s wise to obtain your own coverage, known as non-owner insurance. (More on this later.)

How to Insure a Car After a DUI or DWI

If you get a DUI or DWI, you might decide to stop driving for a while. Or a judge could temporarily yank your driver’s license, so you’re not permitted to drive.

You could cancel your auto coverage if you’re not planning to drive after a conviction–unless you have an auto loan or lease.

“As long as nobody drives the uninsured vehicle, everything is OK,” says Joe Hoelscher, a defense attorney in San Antonio who handles traffic cases.

However, Hoelscher adds, someone convicted of drunk driving might not want to drop coverage even temporarily. Why? There’s no guarantee that your insurer would issue a new policy after you’ve taken a driving and insurance break.

But what happens if you get a DUI or DWI and have coverage on someone else’s policy? In this case, you could purchase a non-owner policy, Hoelscher says.

“Non-owner policies are secondary coverage that follows a specific person. They’re usually less expensive but only provide coverage to a person who does not own a vehicle,” Hoelscher says. 

For example, if you have a child convicted of drunk driving on your policy, the insurer could refuse coverage. However, your child could have non-owner coverage in order to drive your vehicle

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