JUMP TO Section Chevron icon It indicates an expandable section or menu, or sometimes previous / next navigation options.- What is Non-Owner Car Insurance?
- Non-Owner Car Insurance Coverage Options
- How Much Does Non-Owner Car Insurance Cost?
- Non-Owner Car Insurance Benefits
- How to Purchase Non-Owner Car Insurance
- FAQ
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- Non-owner insurance is made for drivers who regularly borrow or rent cars.
- Non-owner insurance is typically cheaper than a regular liability-only policy.
- You'll have to call insurance companies to see if they provide coverage in your state.
If you do not own a car, but frequently rent or borrow cars from a friend or relative, non-owner car insurance could be a requirement. Car insurance in the United States allows for permissive use, but going to the grocery store at Thanksgiving is different than borrowing your family member's car once a week for babysitting.
Generally speaking, even cheap car insurance companies prefer that the car owner add that driver to their policy. It makes the process a lot simpler if there's an accident. However, drivers who switch cars regularly won't benefit from being on a car owner's policy. If car owners fail to add a regular driver, insurance companies may even deny future claims.
What is Non-Owner Car Insurance?
Definition and Overview
Non-owner car insurance is basically liability car insurance coverage for drivers who don't own a car. It acts as secondary coverage when the owner's insurance won't or doesn't cover all the bills. Because there is no comprehensive or collision coverage, it doesn't cover damage to the car you are driving, but it does cover damage to the other vehicle.
For example, imagine you're driving a friend's car and are rear-ended, causing you to hit the car in front of you. A claim will be filed against your friend's car insurance provider for damage to the car you hit. Your non-owner car insurance will kick in to cover what isn't covered by your friend's insurance, depending on your coverage limits. Damage to your friend's car would be covered with you as a permissive driver
Who Needs Non-Owner Car Insurance?
Non-owner car insurance is best for people who borrow cars from friends or family who live in separate households. It is ideal for individuals who do not own a car but frequently rent or borrow cars. However, if you regularly borrow a car from someone who lives with you, you should be added to that person's insurance policy as an additional user instead.
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Non-Owner Car Insurance Coverage Options
Liability Coverage
Liability insurance pays for the affected party's damages and injuries if you're at fault in an accident. It also covers legal expenses if someone sues you. Most states require drivers to carry the minimum required liability coverage. Check your state DMV or insurance department website to find the minimum coverage requirements you must maintain.
Uninsured/Underinsured Motorist Coverage
Uninsured (UM) and underinsured motorist (UIM) insurance covers your vehicle repairs and medical expenses coverage if an uninsured or underinsured person. It also provides coverage if you're a victim of a hit-and-run incident.
Not all non-owner policies cover this. So it's a good idea to read the fine print and ask your insurance provider if you can include this coverage in your policy.
Medical Payments Coverage
Medical payments (Medpay) pay for your and your passenger's medical expenses if you sustain injuries in an accident, regardless of fault. It can also cover high health insurance co-pays and deductibles.
How Much Does Non-Owner Car Insurance Cost?
Average Cost Estimates
The average cost of non-owner car insurance is $325 a year or $27 a month, which is significantly cheaper than the average cost of a standard policy, according to Insurance.com. Take a look at the cost of non-owner insurance with various insurers:
Company | Average Monthly Rate | Average Annual Rate |
Geico | $28 | $333 |
USAA | $15 | $177 |
State Farm | $22 | $262 |
Progressive | $45 | $536 |
Travelers | $28 | $338 |
Nationwide | $41 | $490 |
Farmers | $41 | $494 |
Allstate | $53 | $641 |
Source: Insurance.com
Factors Affecting Cost
Factors that may affect the cost of your insurance policy include your:
- Location
- State minimum coverage requirements
- Vehicle specifics
- Age and gender
- Driving experience
- Credit history
- Coverage limits and deductibles
- SR-22 or FR-44 requirements
Non-Owner Car Insurance Benefits
Protecting Your Financial Interests
Non-owner car insurance protects your financial interests by covering liability expenses when you drive a vehicle that isn't yours. This saves you from significant out-of-pocket expenses in the event of an accident, even if you don't have the standard policy.
Non-owner car insurance also prevents a lapse in coverage if you are going to have a break between getting rid of one car and buying another. Coverage lapses result in higher premiums, so it's a good idea to always carry insurance, even if you're temporarily not driving.
Meeting Legal Requirements
Driving without insurance results in severe penalties such as high fines, impoundment, and even jail time. Be sure to carry your state-mandated liability coverage to avoid financial and legal repercussions.
Coverage When Renting or Borrowing Cars
Non-owner car insurance provides coverage when renting or borrowing cars. This could be essential if you do not own a vehicle but need to drive regularly.
How to Purchase Non-Owner Car Insurance
Step 1: Determine your coverage needs
The first step when buying non-owner car insurance is to figure out your coverage needs. Be aware that non-owner insurance doesn't provide coverage for your vehicle. So if you drive frequently, you're likely better off with a full-coverage policy.
It's important to check your state's auto insurance requirements to ensure you're complying with state laws and avoiding penalties. Some states may require you to carry UM and UIM, as well as personal injury protection or Medpay, in addition to the minimum liability coverage.
You'll also want to consider your individual coverage needs. If you're a high-risk driver, you may need SR-22 or FR-44 insurance, which significantly increases your rates. You may also want to look into rental car reimbursement if you rent cars frequently or roadside assistance if you drive a lot.
Step 2: Research Companies and Gather Quotes
After determining your needs, look for reputable companies in your state that offer non-owner car insurance coverage options based on those needs. For example, not all companies will insure drivers who need to file an SR-22 or FR-44. An online search can direct you to the best companies for high-risk drivers.
Then, you'll want to gather non-owner car insurance quotes quotes from those companies. The Insurance Information Institute recommends obtaining quotes from at least three insurers. Most providers won't offer online rates for non-owner insurance like they would for the standard policy. So, you'll need to call to obtain estimates.
Step 3: Compare quotes
Finally, you'll want to compare quotes from your chosen companies. Ensure that each quote is for the same coverages, deductibles, and coverage limits for the most accurate apples to apples comparison. Then pick the company that offers the most affordable non-owner car insurance.
Most insurance companies ask for basic information like your driver's license number, Social Security number, address, driving or claims history, previous insurance information, and payment information. Be sure to have those related documents on hand when you speak to an insurance agent.
Additionally, it's a good idea to have your vehicle information ready such as your VIN, make and model, and registered owners of the car you're insuring.
Non-Owner Car Insurance FAQs
What is non-owner car insurance? Chevron icon It indicates an expandable section or menu, or sometimes previous / next navigation options.Non-owner car insurance provides liability coverage for drivers who don't own a car but occasionally drive a rental car or borrow vehicles.
Who should consider non-owner car insurance? Chevron icon It indicates an expandable section or menu, or sometimes previous / next navigation options.Individuals who should consider non-owner car insurance include those who frequently rent cars, borrow cars, or need proof of insurance for license reinstatement.
What does non-owner car insurance cover? Chevron icon It indicates an expandable section or menu, or sometimes previous / next navigation options.Non-owner car insurance covers liability for bodily injury and property damage and may include uninsured and underinsured motorist coverage and medical payments coverage.
How much does non-owner car insurance cost? Chevron icon It indicates an expandable section or menu, or sometimes previous / next navigation options.Non-owner car insurance costs $325 a year or $27 a month. But your personalized quote will vary based on factors such as your state's minimum coverage requirements and your location.
Can I get non-owner car insurance with a suspended license? Chevron icon It indicates an expandable section or menu, or sometimes previous / next navigation options.Insurance companies offer non-owner car insurance if you have a suspended license. This coverage is commonly used to help with license reinstatement at an affordable rate.
How do I purchase non-owner car insurance? Chevron icon It indicates an expandable section or menu, or sometimes previous / next navigation options.You can purchase non-owner car insurance by contacting a reputable insurance provider, filling out an application over the phone, and providing necessary documents like your driver's license and payment information.
Alani Asis Alani Asis is a personal finance expert with experience covering insurance, retirement, and credit at both Business Insider and LendingTree. Her work has been published in AARP, CNN Underscored, Forbes, Fortune, PolicyGenius, and U.S. News & World Report.ExperienceAlani is a former insurance fellow on the Personal Finance Insider team. She’s reviewed life insurance and pet insurance companies and has written numerous explainers on travel insurance, credit, debt, and home insurance.She is passionate about demystifying the complexities of insurance and other personal finance topics so that readers have the information they need to make the best money decisions.ExpertiseAlani’s areas of personal finance expertise include:- Car insurance
- Life insurance
- Home insurance
- Travel insurance
- Pet insurance
- Credit
- Credit cards
- Retirement planning
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