Car insurance policies, coverage, and liability can be a tricky topic. For instance, sharing a household with a car owner does not always automatically include a person as a covered driver on the car’s liability insurance. The car owner and holder of the policy would generally have to specifically add any individual drivers to have them covered whether they may be housemates or relatives.
This does not mean that the driver’s own insurance will cover any accident. When an accident occurs, the insurance policy that matters is the one attached to the car, not the driver. If someone is driving a car that is not theirs and causes a collision, the insurance attached to that car is the one responsible for damages. Cars fall under the definition of an ‘inherently dangerous tool’ and the owner of that car is liable for the actions of anyone they allow to operate it. The person operating the car who caused the accident may be held accountable for their actions as well, but the car owner holds the primary responsibility due to the Dangerous Instrumentality Doctrine.
Car Insurance Goes with the Vehicle
Auto insurance is based on the car, not the driver. If you let your friend or family member drive your car and they cause an accident, you are liable for the accident and your insurance is responsible for covering any damages. It is also your driving record that will be negatively affected and your insurance payments that could go up.
What is the Dangerous Instrumentality Doctrine?
The Dangerous Instrumentality Doctrine (DID) is also referred to as vicarious responsibility. This means that you are responsible for any damages caused by someone else using your property with your permission. Cars are considered inherently dangerous and so by owning one, you are responsible for its use.
The idea is to take care of anyone who might be injured as a result of an accident involving your car. It is expected that the owner of the vehicle has some kind of insurance on it, which ensures that the injured party is taken care of. Some insurance policies allow for the driver to bear some of the responsibility in addition to the owner’s liability. It is important to understand how coverage works before allowing another driver to use a vehicle.
How Primary Coverage Works
When a car owner lets someone borrow their car, and they hit someone or someone else’s property, the owner bears responsibility, and their car insurance is the primary source for compensation for any injuries or property damage. The owner has to file a claim, pay any deductibles, and suffer rate increases.
It is possible that the person who borrowed the car may bear some financial responsibility. Their insurance could act as a secondary back up policy. If the damages they caused go above what the car owner’s policy can pay, they may be able to have their insurance cover the rest.
If the person who borrowed a car is not covered by or is explicitly excluded from the owner’s car insurance policy, the owner’s insurance may or may not hold them responsible depending on whether or not the person actually had the owner’s permission to be driving their vehicle.
Circumstances When Car Owner Isn’t Held Liable for a Borrowed Car Accident They Weren’t Involved In
You may have wondered “If someone borrows my car and gets in an accident, am I liable?” The short answer is “Usually, yes.” However, there are exceptions to every rule, and some instances where a car owner is not held liable in the event that someone causes an accident with their car:
- If someone steals your car and then causes an accident, you may not be held responsible for damages.
- If a friend or relative borrows your car without permission, their own insurance would serve as primary coverage and your own as secondary if necessary.
- If a friend or relative borrows your car without your permission and they do not have insurance of their own, there are variables that determine if your insurance will pay:
- Did they have reason to assume they had permission?
- Do they live with you?
- Did they have permission in the past?
- Did you leave the keys somewhere available to them?
While you are generally not held liable for damages caused to others by someone who did not have your explicit or implied permission to be driving your car, you will still have to take care of damages to your car itself.
Reasons Why Car Insurance May Deny a Car Accident Claim If Borrowed
There are also instances where you lend someone your car and your insurance company will not cover damages they cause:
- The person who borrowed your car was driving while intoxicated
- The person who borrowed your car was not included in your insurance policy
- The person who borrowed your car was unlicensed or had a license that was suspended
- The person who borrowed your car was incompetent, reckless, or unfit to drive
In these instances, even if your insurance denies the claim, you would still be held personally responsible for any damages.
Borrower Isn’t Licensed to Drive
It is illegal to drive without a license or when the license is suspended. If you loaned your car to someone without a valid license, your insurance company may deny any claim for damages they cause. You could argue that you had reason to believe they did have a valid license, and your insurance company may take that into consideration. Of course, if your car was stolen, you may not be held liable as well.
You Lent Your Car to an Incompetent, Reckless, or Unfit Driver
When you lend your car to someone, you are taking responsibility for their driving. If they are an incompetent, reckless, or unfit driver and they cause an accident, you may be held responsible. This is called ‘negligent entrustment’ and it must be proven that the person who lent the car out had reason to know that the person they lent it to was an incompetent driver.
There are many instances where a person can be guilty of negligent entrustment and would be responsible for the borrower’s actions, such as lending your car to:
- Someone who is drunk or someone who will be drinking
- Someone with a poor driving record
- Someone who is underage and cannot legally drive
- Someone with a learner’s permit who is driving without supervision
- Someone who could be considered too elderly to drive
- Someone with an illness or impairment that prevents them from driving safely
If Lending Your Car is Done Frequently
It is generally recommended that if someone is going to be using your car frequently, you should add them as a covered driver on your insurance policy. While this does increase your rates, it is better in the long run should anything happen. If you do not add someone to your policy and they cause an accident, if the insurance company finds out that they regularly used your car, they may deny the claim.
If the Borrowed Car is Used for Deliveries
Insurance policies tend to specify the different things the car will be used for. There is a difference between insuring a car for personal use and insuring a car for commercial use. If you lend your car to someone who uses it to make deliveries of products or people, and this is not a listed use under your policy, the insurance company may deny your claim.
It is possible that if you can prove you did not know your car was being used for deliveries, then the insurance company may decide to grant the claim anyway, but this is not something you can be sure of.
There are policies for cars and other vehicles that are intended for both personal and commercial use, so if you intend on allowing a friend or relative to use your car for deliveries, then you should be sure that you have the appropriate insurance coverage policy. And as always, if you are going to have someone else driving your car regularly, you should add that person as a covered driver.
If Borrower has Been Explicitly Excluded from Insurance Policy
If someone has been explicitly excluded from driving your vehicle under your insurance policy and then drives your car and causes an accident, not only will the insurance refuse to cover them, but you will still be liable for any damages they cause.
Other Considerations for Borrowed Car Liability
There are always variables at play when determining things like liability. Generally speaking, when an accident occurs, the person who caused the accident is liable for the damages. With the exception of no-fault states, if someone borrows your car and then someone else hits them and that other person is at fault, then that person and their insurance will be expected to pay for damages. Check your state law guidelines regarding fault and liability.
Sometimes, it also matters if you and the person who borrowed your car live together. Some insurance policies will extend coverage to anyone who lives at the main driver’s residence whether they are friends or family members. Not all policies have this, so it is important to be sure what kind of coverage you have before lending anyone your vehicle. If your policy does not include your housemates and you intend on letting them use your car, it is a good idea to add them to your policy individually.
How to Protect Yourself When Lending a Car
Letting other people drive your car can often be more trouble than it’s worth, especially if you have not taken the proper steps to protect yourself in case they get into an accident. There are a few things that are always good practice when loaning someone your vehicle:
- Always make sure they have a valid license.
- Put the registration and insurance information somewhere safe and accessible and make sure they know where to find them.
- Have some sort of written agreement specifying exactly what they will and will not be using the car for.
- Have them agree that they will not allow anyone else to drive the car.
- Make sure the car is running properly.
How to Protect Yourself When Borrowing a Car
Sometimes it may be necessary for you to borrow someone else’s car. In these situations, it is important to know the steps to take to protect yourself should you be involved in an accident:
- Obtain proof that the car is insured before driving.
- Make sure your license is valid.
- Do not allow anyone else to drive the car.
- Do not drink or use drugs before or while driving.
Contact Mesriani Law Group if You Have Been Injured in a Borrowed Car Accident
Auto accidents involving borrowed cars can be complicated. It may be difficult to pin down liability and hold the people responsible accountable to obtain compensation. After any accident, it is a good idea to speak to a lawyer to help you figure out your best options and the right next steps to take. A personal injury attorney can help you navigate the process, negotiate with the insurance companies, identify the parties liable, and help you receive the compensation you deserve. Our car accident lawyers knowledgeable, experienced, and dedicated. If you have been the victim of a car accident involving a borrowed vehicle, call Mesriani Law Group today for a free consultation.
Borrowed Car Accident Liability FAQs
What happens if you let a friend borrow your car and they wreck it?
Generally speaking, when someone else crashes your car, you are still the one liable and your own insurance is the one responsible for covering the damages. There are some occasions where the driver’s own insurance may help as a secondary coverage, but not always. There are also occasions where your insurance may refuse to pay for damages, but you will still be liable for them, such as lending your car to an incompetent driver.
What happens if someone else is driving my car and gets in an accident?
When someone is involved in a collision while driving your car, one of the first things taken into consideration is who caused the accident. If the other driver was at fault, then they are the one responsible for the damages. However, if the person driving your car caused the crash, you can be held responsible through vicarious liability. Because it is your car, you take responsibility for anyone you allow to drive it. There are circumstances where this may not apply, such as when someone steals your car and is driving it without your permission.
Can someone borrow my car and be insured?
It is possible to insure other people to drive your car. There are instances where the insurance company will cover accidents caused by a driver other than the policy holder. Some policies even provide coverage for anyone living in the same household as the policy holder. If you are going to have someone borrow your car on a regular basis, then it is advisable to add them as a covered driver under your policy. If someone does not have their own car and often borrows other people’s vehicles, they may look into getting a non-owner insurance policy.