May I Borrow Your Insurance, Please?
by Chad Yoder, Personal Lines Manager

John Doe is sending John Jr. off to college for his senior year. On the surface, it doesn’t seem any different than past years. This year, however, Jr. will take a car with him for easier commuting and convenience.

“He will park in the campus lot and only use it on the weekends,” say his parents. Although this scenario doesn’t seem unusual, there are hidden hazards. What Mr. and Mrs. Doe don’t realize is that having a car will be convenient, not only for their son, but for many of his friends as well.

Liability Follows the Car
I remember car keys being borrowed many times during my own college years, and there were a few times that the borrowed car did not come back in the same condition as when it left the campus lot. Although it’s easy to point fingers and place blame, when liability is involved, it’s the auto insurance policy that dictates what will be paid and to whom.

Liability and Collision coverages follow the vehicle listed on the declaration page of the policy, regardless of who is behind the wheel. You’ve heard stories about children accidentally starting the car and putting it in gear, or someone who is carjacked and later learns the thief wrecked the car and injured others. As bizarre as these scenarios seem, it’s important to know that you’re protected if you are sued as the titled owner of the vehicle.

Loaning More Than Your Car
Intentionally loaning your car to a friend or relative may impact your policy if that person has an accident. It is important to discuss this before allowing someone to get behind the wheel of your car. Know who is driving your car, even on an occasional basis. Be sure the person has a valid license, a clean driving history, and is someone you trust with your vehicle and insurance.

Lastly, remember this rule — If you loan your car, you are also loaning your insurance.

FIFS Connection, Fall 2005, Vol.2, No. 4