Don’t own a car? You still might need your own auto insurance coverage.
Non-owner car insurance is a special policy designed for people who don’t have a car. It provides liability coverage when you rent or borrow someone’s vehicle. Liability insurance pays if you cause injuries to others or property damage in a car accident.
When to get non-owner car insurance
Consider non-owner car insurance if you:
Were convicted of a DUI or other serious violation: Your state might require you to file an SR-22 form — known as FR-44 in some states — to get your driver’s license reinstated. These forms prove that you have car insurance. A non-owner car insurance policy suffices if you don’t own a car.
Rent cars frequently: Non-owner insurance can serve as rental car insurance and might be cheaper than paying for liability coverage at the rental counter. Remember that liability insurance pays if you cause property damage or injure others in a car accident. Non-owner insurance generally doesn’t cover damage to the car you’re driving. Check whether you have insurance for damage to the rental through a credit card or buy the collision-damage waiver from the rental car company.
Use a car-sharing service such as Zipcar: A non-owner policy supplements the liability coverage the car-sharing service provides. It’s helpful in case an accident victim sues you.
Borrow other people’s cars: If there’s an accident, the car owner’s insurance normally pays out. But if the costs exceed the owner’s liability limits, you could be on the hook for the remainder. Non-owner car insurance would supplement the owner’s coverage.
Want to maintain continuous auto insurance coverage: This can help save money on car insurance later. Going without coverage — even when between cars — can make you look risky in the eyes of insurers, which can lead to higher rates when you buy a vehicle.
Non-owner car insurance isn’t the right choice if you live with people — say your parents — and drive their cars. Instead, you should be listed as a driver on their policies because you have regular access to their vehicles.
How to buy non-owner car insurance
Many of the largest insurers offer the non-owner coverage for personal vehicles, at least in some states, but Allstate and Progressive do not. Generally, price quotes aren’t available online.
What non-owner car insurance covers
In addition to liability insurance, a non-owner policy can include medical coverage for yourself and uninsured/underinsured motorist coverage, in some states, depending on the insurer. Uninsured/underinsured motorist insurance covers medical bills if you’re injured in an accident caused by a driver without any or enough liability insurance.
Non-owner insurance generally doesn’t include collision or comprehensive insurance. In a standard auto policy, that coverage pays for repairs or replacement of the vehicle you own.
Cost of a non-owner policy
Typically, a non-owner car insurance policy costs less than what you would pay for the same level of liability coverage for a car you own.
The price depends on your age, driving record and how often you plan to drive.
Not many people know car insurance can be purchased for the times when they do not own a car. A non-owner auto insurance policy covers you for liability when you do not own a vehicle. It is purchased per driver, so multiple drivers are not covered under one policy. While most non-owner auto insurance policies do not provide coverage for medical or any physical damage, however, it is possible to find medical coverage depending on the car insurance carrier.
Should I Have A Non-Owner Insurance Policy?
There are several times that it makes sense to purchase this type of coverage — and many times when it doesn’t. If you rent a car frequently, it might make sense to purchase this type of coverage rather than shelling out at the rental counter. If you drive your friend’s cars often, it is also a good idea to have this kind of coverage.
However, if someone else in your household owns a car you plan on driving, you shouldn’t get a non-owner policy — rather, you’ll need to be listen on their policy.
3 Benefits of a Non-Owner Car Insurance Policy
Non-owner auto insurance policies are available everywhere but do not get talked about very often. Many people have never heard of an auto policy for a person who does not own a vehicle. It is always recommended to avoid a lapse in car insurance coverage if at all possible. A non-owner auto insurance policy can protect you for those times when you do not own a vehicle.
Protection for Liability is Important Even If You Do Not Own a Vehicle
Example: A lot of things can go wrong while driving. A non-owner auto insurance policy would protect you if you do not own a vehicle and you borrow a friend’s vehicle. If your friend had minimum liability on a vehicle and you caused a severe accident, the injured party could go after you personally for pain and suffering if the damages are more than your friend’s limits. A non-owner auto insurance policy would kick in and pay the excess damages.
You Can Save Money On a Rental Car
Example: Rental companies charge a lot for their insurance coverage. If you frequently rent a car but do not own a car, a non-owner auto insurance policy will most likely save you money. You will still need to purchase the collision damage waiver so physical damage will be covered (or check with your credit card company — some offer this coverage if you book using your card), but in general, the non-owner auto policy will extend liability. As with most car insurance coverage, rules can vary by state and insurance carrier but typically a non-owner policy will cover liability for a rental car.
Keep Your Preferred Driver Risk Status
Example: A great benefit of purchasing a non-owner policy is to protect your driver risk status. Many insurance companies consider drivers with no prior insurance high risk. A non-owner auto policy would prove you had financial responsibility as a driver without an owned vehicle. This means you will pay a lower rate on car insurance when you purchase a car.
Keep In Mind Non-Owner Policies Do NOT Cover:
Physical Damage: A non-owner policy never covers physical damage on any vehicle.
A Vehicle You Own: Do not forget to convert your non-owner auto insurance policy into a traditional auto policy once you own a vehicle. Non-owner auto insurance will not cover a vehicle you own.
A Vehicle Owned by Resident of Your Household: If someone owns a vehicle in your household, you should be listed as a driver on their insurance policy as long you do not own your own vehicle. A non-owner auto policy will not cover a vehicle you regularly access.