Who Needs Non-Owner Auto Insurance?

Auto Insurance

What is Non-Owner Car Insurance Policy?

Non-owner insurance, also known as non-drivers insurance, covers bodily injury and property damage when driving a vehicle that you do not personally own. So, if you get into an accident with another driver and are found to be at fault, your non-owners insurance policy will protect you from lawsuits, just like a standard liability policy.

And apart from liability coverage, which pays for the other party’s injuries and property damage in the event of an accident, a non-owner auto insurance policy may also include:

  • Personal Injury Protection vs. Medical Payments
  • Insurance for Uninsured or Underinsured Motorists
  • Liability Insurance for Rental Cars

A non-owner auto insurance policy will not include comprehensive or collision coverage because there is no specific vehicle assigned to it. As a result, it will not cover damage to your vehicle, medical bills, or other costs resulting from injuries incurred in a collision.

Is Non-Owner Auto Insurance Required?

If you don’t own a car, you are not legally required to have auto insurance. However, there are a few reasons why you might prefer for non-owners car insurance:

  1. You frequently rent cars.
  2. You frequently borrow other people’s vehicles.
  3. You sold your car or will not be driving it for an extended period of time, such as while serving in the military overseas.
  4. Because of a DUI or other serious traffic traffic violation, you require an SR-22 or FR-44.

1. You Frequently Rent Cars

If you rent cars frequently, a non-owner policy may be less expensive in the long run than purchasing rental car insurance on a regular basis. Insurance from the rental company typically costs at least $20 per day, so if you rent a car for 50 or more days per year, the annual cost will likely exceed the annual cost of a non-owner auto insurance policy. Just remember to:

  • Confirm with the insurer that the non-owner policy will cover you for liability when driving a rental car.
  • Check to see if rental car damage is covered by your credit card’s rental car insurance. If not, you should get a collision-damage exemption from the rental company.

A credit card’s rental car insurance will not protect you if someone sues you for damages. This free card benefit only covers rental car damage. Outside of carrying a policy for a vehicle you own, combining your credit card rental insurance with the liability portion of a non-owners policy would actually provide you with the most comprehensive coverage, because your car insurance also provides some coverage for a rental car.

2. You Frequently Borrow Cars from Others

Non-drivers insurance may be a good option if you frequently borrow cars from friends or other people. It ensures that you have a certain level of coverage every time you drive, so you don’t have to worry about whether the car owner’s insurance policy will cover you or if the liability limits are too low.

Just keep in mind that if the car you borrow belongs to someone you live with, or if you borrow the same car on a regular basis, you will most likely need to be added to the car owner’s insurance policy for primary coverage. If you don’t have a non-owner policy, the company that issued it may not cover you at all in the event of an accident.

3. You have Sold Your Car Or Will Not Be Driving For an Extended Period of Time.

Almost every insurer raises prices for drivers who have had a “gap in coverage,” or have been without auto insurance for an extended period of time after previously having insurance. Even if you never drove a car while uninsured, you will be considered a higher risk and will not be eligible for the best rates.

Because non-owner auto insurance is less expensive than traditional coverage, it may be a good idea to remain covered with a non-owner policy, especially if you predict to need insurance in the future. This is especially true if you own a high-priced vehicle. Also, if you are in the military and are being deployed overseas, a non-owner policy may be the most cost-effective option, even though some companies offer discounts for time spent out of the country. If that is the case, compare quotes from various insurers to be certain.

4. SR-22 Insurance for Non-Owners

If you have a DUI or a serious traffic violation, you may require SR-22 or FR-44 insurance to have your licence returned. Depending on the SR-22 requirements, you may need higher limits and must maintain this coverage for two to five years in order to keep your licence.

Because you cannot file an SR-22 on your own and must rely on your insurer to do so, a non-owner SR-22 policy can be useful, especially if you do not own a car. The company from which you purchase the non-owners policy can file the SR-22 on your behalf and get you back on track to gaining back your licence.

One significant advantage of using non-owners insurance for an SR-22 is that it is less expensive. You’ll still be charged more than others for whatever reason the SR-22 was required, but your premiums won’t be as high as they would have been with a traditional auto insurance policy.

Keep in mind that not all insurance companies, particularly smaller ones, will sponsor an SR-22 or FR-44. If yours does not, you can obtain a non-owner policy through another company and let them file the SR-22 on your behalf.

Who Doesn’t Need a Non-Owner Policy?

You should not obtain non-owner auto insurance if:

  • You have a car.
  • You borrow a car from someone with whom you live.
  • You almost never borrow someone else’s car.
  • You drive a company car for business purposes only.



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