Do you need non-owner car insurance?
For some people, owning a car just isn’t necessary. Depending on where you live you could be just fine taking public transit, walking, biking, or carpooling. But every so often you may need to take longer independent trips. Other times, you might take a turn driving someone else’s car for them if they need help. If you borrow or rent a car, you need to make sure you’re covered.
That’s why some people purchase a non-owner car insurance policy. Non-owner car insurance isn’t very common, but it can be useful. Here’s what you need to know about this insurance product.
What is non-owner car insurance?
This may not be a big surprise, but non-owner insurance is standalone coverage for drivers who don’t own a vehicle, but drive occasionally.
Much like regular coverage, it covers you if you get into a collision and cause damage to someone or their property. This is called liability coverage. Liability is the bare minimum coverage for any vehicle on the road, and as a driver of any car it can be worth having. As a non-owner, comprehensive and collision damage coverages are unnecessary for you. These insurance policies usually only apply to your own vehicle.
Do I need a non-owner car insurance policy?
As you consider the possibility of buying an insurance policy, you’re probably thinking:
“If I borrow a car can’t I just be covered under the owner’s policy as an occasional driver? Or if I rent a car can’t I purchase coverage through the company?”
You are absolutely right. Both of those options give you the coverage you need in most situations. However, some people prefer to purchase their own policies simply because they want to make sure they have a certain amount of coverage. This is especially true if you’re renting in the U.S.
Each state has its own mandatory minimum liability coverage. and it’s often not very high ($15,000 to $25,000). Many rental companies allow you to purchase more liability coverage. Considering how expensive legal fees, medical care, and other expenses can be if you get into a collision it’s well worth considering buying the extra coverage.
Also, if you rent cars often, it may be more economical to have your own standalone policy rather than always purchasing the rental company’s coverage. The coverage offered through the rental company can get quite steep over time.
While it may not be something many people need, it’s important to know what options you have, so you can get the coverage that’s right for you.