Generally, Auto Insurance Runs with the Car; However, Each Circumstance Is Different
Who is responsible for car accidents and under what circumstances is a frequent concern for many on a regular basis, especially given how frequently roommates and friends will allow someone else to borrow their car.
The first and most important “rule” covering these circumstances is that insurance travels with the car; thus, regardless of who was driving, the insurance paid for to cover that car will go into effect.
In these types of circumstances, you will need to take a close look at your insurance policy and ensure that it includes collision and liability coverage. If the damage goes beyond the car owner’s policy limits, and the individual who borrowed the car has auto insurance, that policy can cover the rest of the cost. However, if they are uninsured, you could be liable for everything. This is why individuals who frequently borrow others’ cars and who do not have an auto insurance policy may want to consider obtaining a “non-owner’s policy” so that an accident is covered in case a car owner’s insurance is inadequate. Texas is one of the states that offer this as an option so that everyone has minimum liability insurance.
If you are responsible for an accident, even if you borrowed someone else’s car and they failed to register/insure it, you are liable for any damages caused. The one exception is that a car owner is not responsible if the car was borrowed without their permission.
When you loan out your car—with your permission—you are taking responsibility for the driver of that car insofar as your insurance policy goes. Thus, if the person who borrows that car gets into an at-fault accident, your rates will likely rise because you are a higher risk by allowing that individual to borrow the car.
When it comes to traffic violations, these apply to the license of the driver and not necessarily the car owner.
Keep in mind that the auto insurance policy covering the car might “cry foul” if the car is frequently borrowed and the borrower is not placed on the car owner’s insurance policy. The insurance company could claim that this constitutes failure to disclose pertinent information related to the car’s usage when obtaining the policy.
If you have been injured in Texas by a borrowed car, contact our car accident and personal injury attorneys today to discuss how we can help. We are eager to assist you in any way we can.