How non-owner car insurance works

Man sitting in the front seat of a convertible, driving with his dog sitting in the passenger seatImage: Man sitting in the front seat of a convertible, driving with his dog sitting in the passenger seat

In a Nutshell

If you sometimes drive cars that you don’t own, car insurance for non-owners could help protect your finances. This type of insurance coverage can provide added liability protection if you cause an accident while driving someone else’s vehicle. It can also help you avoid lapses in auto insurance coverage and could be required to reinstate your driver’s license after it’s suspended.
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Whether you borrow a friend’s vehicle, use car-sharing services like Zipcar or rent cars often, car insurance for non-owners can provide an extra layer of protection while you’re behind the wheel.

Non-owner car insurance provides liability coverage for people who occasionally drive vehicles they don’t own. Depending on your insurance company and where you live, it may provide other types of coverage, too.

Let’s take a look at how car insurance for non-owners works, who may need it and what this type of coverage might cost.



How does non-owner insurance work?

Non-owner car insurance provides drivers with coverage while driving a car they don’t own. Non-owner insurance provides auto liability coverage, which may help pay for the other driver’s medical expenses or property damage after an accident you cause.

Depending on where you live and which insurance company you choose, non-owner car insurance may provide additional protection such as uninsured motorist coverage, personal injury protection or medical payments coverage. Keep in mind that non-owners insurance typically doesn’t cover any damage to the car you’re driving.

The liability coverage provided by a non-owner insurance policy is generally secondary. This means that if you cause an accident while driving a vehicle whose owner has liability coverage, that coverage may kick in first. But if the damages or medical expenses exceed the car owner’s liability coverage limits, your non-owner insurance policy could help cover those costs.

As with any other type of auto insurance coverage, you can expect to pay a premium for car insurance for non-owners and you’ll have a coverage limit — the maximum amount your insurance company will pay on a covered claim.

It’s important to note that if the vehicle you occasionally drive belongs to a family member or even a roommate, you may not need a non-owner policy. Your state’s laws or the insurance company may require anyone in your household with a car to list you on their auto insurance policy.

What doesn’t non-owner insurance cover?

There are a couple limitations to non-owner auto insurance. Here’s what it won’t cover.

Damage to the car you’re driving

Non-owner car insurance doesn’t provide comprehensive or collision coverage. This means that if you’re found responsible for a wreck, your non-owner policy won’t help pay for any damage to the vehicle you were driving.

A vehicle you own

Non-owner insurance, as the name implies, won’t cover a vehicle that you own. If you end up buying a car, you’ll probably need to buy a traditional auto insurance policy, depending on your state’s requirements.

Do I need non-owner car insurance?

Non-owner car insurance isn’t for everyone. But it may make sense if the following applies to you.

  • You rent cars frequently — Drivers who regularly rent cars may find that buying non-owner insurance is less expensive than buying supplemental liability coverage from the car rental company every time they rent a car.
  • You drive a friend’s car — If you borrow vehicles from friends on occasion, non-owner coverage can further protect you (and them) whenever you get behind the wheel.
  • You’re between vehicles — If you’re temporarily without a car, buying non-owner insurance can help you avoid an insurance coverage lapse. By having continuous coverage — even if you don’t currently own a car and don’t plan on driving until you get one — you may be able to prevent higher auto insurance rates when you’re ready to buy a traditional policy.
  • You use car-sharing services — Drivers who occasionally use car-sharing services may benefit from non-owner insurance. Services like Zipcar may provide drivers with some types of insurance coverage, but non-owner insurance can provide additional protection if the cost of injuries or damage you cause exceed the car-sharing service’s coverage limits.
  • You need proof of insurance to reinstate a driver’s license — If your driver’s license is suspended for something like a DUI, you may be required to provide an SR-22 form (or FR-44, in some states) in order to reinstate it. One of the requirements to obtain this form is proof of valid liability coverage. If you don’t own a vehicle but want to reinstate your license, you may need to buy non-owner insurance coverage.

How much does non-owner car insurance cost?

The average cost of a non-owner auto insurance policy in the U.S. is around $485 per year, according to data published in February 2020 on Insurance.com.

But what you pay for non-owner insurance will depend on a few factors. These may include the coverage limit you want, your driving history, where you live and how often you plan to drive.

In general, you can expect to pay less for non-owner insurance than you would a standard auto insurance policy because you’re only driving on occasion (meaning less risk for the insurance company) and coverage is limited.


What’s next?

If you think you might need non-owner insurance coverage, consider reaching out to an auto insurance agent. They can help you decide whether this type of coverage fits your needs and identify insurance companies that offer non-owner insurance.

Non-owner insurance is only offered by a few auto insurance companies. And the ones that offer it may require you to call or visit a local office for an insurance quote instead of allowing you to get a quote online.

As with any auto insurance product, it’s always smart to compare quotes from multiple companies. Taking the time to do this can help you find the best policy that meets your needs.


About the author: Stephanie Colestock is a personal finance writer with a passion for helping readers take control of their money. If it has to do with planning for the future, getting out of debt, or even traveling the world on points… Read more.