Who Does Auto Insurance Coverage Cover

If you lend your car to someone else, you may wonder whether your auto insurance coverage will cover that driver in the event of an accident. This can be a huge concern, because if the driver isn't covered and gets into an accident, you could find yourself the subject of a lawsuit. Fortunately, in most situations, the answer is that the auto insurance coverage extends to anyone you knowingly let drive your vehicle.
Who Does Auto Insurance Coverage Include?

When you apply for an auto insurance policy, generally, you should list your spouse and any children of driving age on the policy. If the insurance company finds out you left off your spouse who routinely drives, in order to avoid having your rates raised because of his history of tickets, this could constitute insurance fraud. It could also give the insurer an excuse to deny coverage if your spouse gets into an accident when you expressly hid his presence when applying for insurance.

However, you obviously cannot list every person who may borrow your car on the insurance policy. Fortunately, insurance generally covers anyone who you willingly grant permission to borrow your vehicle. This rule extends to people who borrow the car in a one-time situation, or occasionally. If you intend to have someone drive your vehicle on a regular basis, they should be listed on your policy.

If the person driving the vehicle does not have the express permission of the named insured, auto insurance coverage may not be extended. For example, if your child allows his friend to drive your vehicle without your knowledge, your insurer may deny coverage to the friend. Likewise, if the person who borrows your car is not legally allowed to drive or does not have a valid driver's license, coverage may be restricted.
What Happens if the Person Isn't Covered

If you lend someone your vehicle and your insurance carrier denies coverage in the event of an accident, you can attempt to recover damages through the insurance policy of the person who was driving. The liability provisions of his own car insurance policy may provide him with coverage against your claim of damages. You could also sue the person who was driving individually for damages, to recover the amount you had to pay out as a result of his improper driving of your vehicle.

Exactly what happens in this situation will depend on what the incident was, who was responsible, what types of insurance coverage all parties have, and the other specific circumstances of the accident.
Verifying Auto Insurance Coverage

Before you lend someone your vehicle, it is a good idea to check with your insurance carrier to find out their policy on extending auto insurance coverage to unnamed drivers. Otherwise, you could be opening yourself up to potentially expensive liability in the event of an incident.