Understanding Non-Owned Auto Insurance: When It Kicks In And What It Covers

Non-owned auto insurance is a type of insurance for people who don't own a car but still want to be insured when driving. This type of insurance is ideal for those who frequently borrow or rent cars, or who need to prove their coverage, perhaps because they've lost their license after a traffic violation. Non-owned insurance provides liability coverage for bodily injury and property damage, meaning that it will cover you if you're liable for damages or injuries in an accident. It doesn't, however, cover damage to the vehicle you're driving or your own injuries after an accident.

Non-owner car insurance is for those who rent, borrow or car-share

Non-owner car insurance is a good option for those who don't own a vehicle but regularly borrow or rent other people's cars. It's also useful if you need to file an SR-22 or FR-44 form with your state, which may be required for reinstating your driver's license after a serious conviction like a DUI.

Non-owner car insurance provides liability coverage for people who don't have their own vehicle but occasionally drive someone else's. This type of insurance pays for injuries or property damage you cause others in a car accident. However, it doesn't cover damage to the car you're driving or your own injuries if you cause the crash.

If you only borrow or rent a car occasionally, or if you borrow from someone you live with, you probably don't need non-owner car insurance. In these cases, you may already be covered by the car owner's insurance policy.

Non-owner car insurance is typically cheaper than a standard insurance policy because non-owner drivers generally drive less, reducing the likelihood of accidents. It's also usually more cost-effective than purchasing liability insurance from a rental car company if you rent cars frequently.

If you use a car-sharing service, non-owner insurance can provide additional coverage. Services like Zipcar and Turo often only provide the minimum liability car insurance required by your state, which may not be sufficient in the event of a major accident.

It covers bodily injury and property damage liability

Non-owned auto insurance is a type of small business insurance that covers any vehicle that is rented, leased, or borrowed for commercial purposes. This includes employees' personal vehicles. Non-owned auto insurance is typically purchased as a rider or endorsement for commercial auto or general liability insurance, or as part of a business owner's policy.

Non-owned auto insurance acts as a form of liability car insurance. This means that it protects a business financially if an employee is legally responsible for an accident that results in another person's injury, death, or property damage.

Non-owned auto insurance provides two types of coverage:

• Bodily injury liability coverage: This covers the cost of treating another person's injuries caused by an accident an employee has caused. It also covers legal expenses if the business is sued. Some policies provide compensation for lost time at work and a death benefit to cover funeral costs.
• Property damage liability coverage: This compensates another person for the damage and losses they incur due to an at-fault collision. It covers the cost of repairing or replacing their vehicle and other property, as well as any legal and settlement expenses resulting from a lawsuit.

Non-owned auto insurance is a secondary coverage. This means that it kicks in after any primary coverage, such as the car owner's insurance, has been exhausted. For example, if an employee causes an accident while driving a rented car, the rental company's insurance would pay out first. If the costs of the accident exceed the limits of the rental company's policy, then the non-owned auto insurance would cover the remaining costs, up to its own policy limits.

The amount of coverage provided by non-owned auto insurance depends on the unique risks faced by the business. A combined coverage limit of $300,000 to $500,000 for bodily injury and property damage often provides adequate protection. However, businesses should ensure they have enough coverage to protect their assets from potential lawsuits.

It doesn't cover the driver's injuries or property damage

Non-owned auto insurance does not cover the driver's injuries or property damage. This means that if you are the driver and you are injured in an accident, you will not be covered by this type of insurance. Similarly, if there is damage to the vehicle you are driving, non-owned auto insurance will not cover the cost of repairs.

In the event of an accident, non-owned auto insurance is secondary to any auto insurance that the car owner has on the vehicle. This means that the car owner's insurance will pay out first, up to the policy limits. Only if the policy's liability limits are exhausted will your non-owned auto insurance pay out (up to your policy limits).

Non-owned auto insurance is designed to cover a driver's basic liability insurance needs. It is a liability policy for people who don't own a car but need car insurance, such as those who frequently rent or borrow cars. It is also an option for those who need to prove they have insurance, for example, by filing an SR-22 or FR-44 form with their state.

Liability car insurance covers damage and injuries to others if the policyholder causes an auto accident. For example, if you cause an accident in a car you don't own and someone else is hurt, non-owned auto insurance could cover their medical expenses. It can also cover legal expenses if your business is sued.

Non-owned auto insurance does not include collision and comprehensive insurance, which covers a wide range of problems like car theft, fires, floods, hail, riots, and vandalism. Collision and comprehensive insurance must be purchased separately and are only applicable if you own the vehicle.

It's for those who need to prove coverage, e.g. SR-22 form

Non-owner car insurance is a good option for those who need to prove their coverage, for example, by filing an SR-22 form. An SR-22 is a form that confirms a driver has sufficient car insurance to meet their state's requirements. This form is often required after more serious driving infractions, such as driving without insurance or a valid driver's license. If you've been ordered to file an SR-22 but don't own a vehicle, you can purchase a non-owner car insurance policy. Non-owner insurance will provide liability coverage that meets your state's requirements.

Some insurers don't offer SR-22 filings for non-owner or standard car insurance policies, so it's important to check with your insurer beforehand. When you buy your non-owner car insurance policy, inform your insurer that you need an SR-22, and they will file the form with your state's department or bureau of motor vehicles.

The cost of filing an SR-22 form is generally $25, though it can vary by state and insurer. The cost of a non-owner car insurance policy also varies by insurer but is typically less expensive than a standard car insurance policy. The addition of an SR-22 may increase your insurance rate, but once the SR-22 is no longer required, your rate may decrease.

It's cheaper than standard insurance but more expensive than rental company liability coverage

Non-owner car insurance is often cheaper than standard insurance, but it is more expensive than rental company liability coverage. This is because non-owner insurance is designed for people who don't own a car but still drive regularly, and so are less likely to file a claim. It is also cheaper because it does not include collision or comprehensive coverage, which covers repairs or replacement of the vehicle you own.

The cost of non-owner car insurance varies depending on factors such as age, driving experience, driving history, and location. For example, younger drivers with less driving experience can typically expect to pay more than older drivers. Additionally, drivers who avoid accidents and traffic violations will generally pay less for non-owner insurance.

The average cost of non-owner car insurance is $748 per year, but rates can range from $202 to $1,361 per year. The cheapest non-owner car insurance is offered by Auto-Owners at $202 per year, while the most expensive is offered by Nationwide at $1,361 per year.

Non-owner car insurance can be a good option for those who frequently rent or borrow cars and want to avoid the higher costs of rental company liability coverage. It provides liability coverage for bodily injury and property damage, protecting you if you are liable for damages or injuries in an accident. However, it does not cover damage to the vehicle you are driving or your own injuries.

Frequently asked questions