If you want to insure a car, not in your name, you might face multiple troubles. But luckily, there are some cases where it can be appropriate, for example, if you drive a car of your family member. But can you insure a car, not in your name? Let’s talk about it!
There are three ways you can insure a car, not in your name:
- Adding the vehicle to your existing policy
- Purchasing non-owner coverage
- Buying a separate policy
Why do people get their car insured in someone else’s name?
It’s pretty common for high-risk drivers to ask their relatives with a better driving record to insure their car for them. This results in a lower premium for the high-risk driver, but the premium charged doesn’t adequately assess the risk posed by the high-risk driver. But long-term, this could result in higher rates for everyone insured at that particular insurance company.
Living at the same address
Just let the insurance company know that you live at the same address as the car owner and you can get the deal. However, get the same address might be a problem for you.
Gain partial ownership by co-titling the car, meaning adding your name as a partial owner to your car’s title. Most likely, you and the car owner have to apply for a new title together. You have to pay some fees and go to the DMV to sign the title in person. Insurance premiums will always increase when someone else is added to the policy. In fact, some insurers don’t even allow joint insurance unless the people listed on the policy live together.
Difficulties you can face:
- Some insurers refuse to insure a car that not registered in the policy’s holder name
- Insuring someone else’s car can increase the risk of the policyholder and the insurance company
- Make the car owner get insurance in his or her name by using a comparison tool
When crafting policies insurance companies look to charge that insurable interest. Being the owner of the vehicle qualifies as insurable interest as the motivation is that the car was an investment for the owner. If you don’t own the vehicle, insurance companies are typically a bit wary since that tactic is so often used for fraud according. While applying for car insurance you have to provide some insurable interest. You have to have a vehicle’s “pink slip” which represents a form of car registration or car title. Without that “pink slip” is tougher to demonstrate insurable interest.
What alternatives do you have if you’re not able to insure a car?
- Have a car transferred to your name. Depending on your relationships with the car owner, you might be able to make them transfer the vehicle title to your name. So you become a legal owner of the car and can easily insure it.
- Use other ways of transportation. Do you live in an urban area? If yes, there’s usually plenty of public transportation options. If not, taxi, Uber/Lyft is another good option for you.
These policies are for those who drive someone else’s car without having their own insurance. However, the coverage under non-owner insurance is very limited. Features like collision and comprehensive coverage or whatever else designed to protect the vehicle aren’t included.
Information needed to apply for non-owner car insurance:
- Your insurance company’s agreement. Your insurance company has to agree with adding a vehicle to your existing policy. Not every company will do that, so you might have to search for a new insurance company.
- Vehicle Identification Number (VIN). This information will ensure that you have access to the vehicle and know the owner of the vehicle.
- List of drivers. When you add the vehicle to your policy it only covers you, not the person who owns the vehicle. You can add that additional person to your policy, but if his or her driving record is not good, your rates will be pretty high.