Have you ever done someone a favor and ended up paying for it? One common example of this is letting a friend borrow your car, then learning he or she got into an accident while driving it. Perhaps your friend comes clean right away or maybe you learn about the wreck from a third party. Regardless, your first question is probably, “Am I liable for the damage?” You most likely have car insurance, but you may not understand how your policy works when someone else drives your car and causes a wreck. Here are answers to questions you may have if you find yourself in this situation.
Which Driver’s Insurance Is Responsible for Damages?
The main question you may have is whether your insurance policy, your friend’s insurance policy, or the other driver’s insurance policy will pay the claim. Not all automobile insurance policies are the same. Typically, a liability automobile insurance policy will cover an accident, even if you are not driving your car, as long as you have explicitly allowed another person to drive it. Sounds great, right? Well there’s one other thing to consider: Is your coverage adequate? Depending on the severity of the accident, your policy may only cover part of the damage. If this is the case, your friend’s automobile insurance policy should cover the rest. Hopefully, he or she has an auto insurance policy. While the aforementioned is the norm, there are exceptions. Some liability automobile insurance policies expressly state they will not cover any driver not listed on the policy. If you find yourself in this predicament, your friend’s policy should step in and cover the damage. It’s always smart to make sure anyone you loan your car to has his or her own liability automobile insurance policy. Finally, if a friend “borrows” your car without your permission, all bets are off. Your insurer won’t pay a dime.
Will an Accident Caused by My Friend Cause My Insurance Rate to Increase?
The answer here is probably not one you want to hear. If you loan your car to a friend who gets in an accident and your insurance provider pays all or part of the claim, you’ll have an at-fault accident on your record. To the insurance company, this means you have become a higher-risk customer. Consequently, your insurance company will probably raise your rate.
If My Friend Got a Ticket in Connection with the Accident, Will the Ticket Cause My Rate to Increase?
Fortunately, a traffic ticket affects only the person who received it. If you were not driving, even though it was your car, any repercussions from a traffic ticket fall wholly on the driver’s shoulders. Regardless of whether you are driving or a friend is driving your car and an accident results, the better your insurance policy is, the less traumatic the event will be. Not all affordable auto insurance companies provide reliable coverage. For outstanding service at an affordable price, contact us. Our Dallas, TX, agents would be delighted to give you a free quote.