insured: the car or the driver?

Question

Help me understand how car insurance works...
Here's my problem: The vehicle is insured, not the driver, right? So if I let Slob, my unemployed, carless neighbor wreck my car (which is insured), no problem, it's covered by my insurance, isn't it? AND if Slob manages to get a car, doesn't insure it, and I wreck HIS car, it's not going to matter that I'm insured as the primary driver of my car, right? I mean, nobody's going to ask ME for MY insurance information in that case are they? My car's coverage has nothing to to do with Slob's car's coverage...
More to the point, if my wife and I share one car and I am on the policy as the primary driver, is there any logical reason why she would have to ever be mentioned on ANY policy? She is insured by any insured vehicle she drives, right? And having or not having her on a policy is completely irrelevant, isn't it?

In response to Pretty Petite... So ifmy car is insured by State Farm and I'm driving my neighbor's car (which is insured by Geico) and I have a wreck, State Farm might step up and pay for my medical bills?

Answer 1

Well, I since I work in a claims department at an insurance company, maybe I can thoroughly explain this for you. Auto insurance covers the vehicle first, then the driver. If someone else is driving your vehicle whether it's Slob or your wife, the damages to your car, more than likely will be covered, the Person driving your car may also be eligible for medical payments under the limits on your policy. On the other hand, if you, the insured, or say for instance your wife, and your child is a passenger in someone else's vehicle when an accident occurs, the 3 of you will be eligible for medical payment coverage under your policy limits.

Answer 2

And let me add this concerning why your wife has to be listed.....

Insurance premiums are determined by risk. If you are the only one in the house and don't list your wife as a driver, you are misrepresenting your "risk" and this is grounds for a policy recision so it's completely relevant. Also, insurance companies are entitled to collect premium for those they are taking a risk on, and this means identifying all risks for that particular household. (Yet another reason insurance is high.) Some insurance companies, like mine, are very strict....they define an insured person as anyone listed on the declarations page. If they're not listed, there is no coverage....period.

As for Slob, your unemployed careless neighbor....if he's driving the vehicle with your permision there's coverage if your policy allows for this. Your policy may have 'step down' coverage in this case, where your liability limits drop to state minimum. If he's acting as your agent, then it's not an issue.

If you drive Slob's car that is UM, someone will ask you if you have insurance, like the car you hit. Adjusters don't ask this because we're nosey (okay some of us are), but because the other driver may or may not be entitled to benefits under their policy, and because we're always looking for a source to collect damages back if you, in your example, are at fault.

Keep in mind, there are several states out there considered "no fault" states...basically, in these states, the insurance follows the driver, not the car. For example, you are driving Slob's insured and you wreck and you're hurt. You pursue your injury claim with your own insurance carrier, not his.

My suggestion....read your policy, put your wife on your policy, don't let Slob borrow your car, and all is well.

Answer 3

Yes, in most states insurance follows the car... However, that doesn't guarantee that anyone is allowed to drive it and that you're still covered. If you have a very restrictive, high-risk policy, Slob may NOT be allowed to drive your car - but that's the exception, not the rule. You'd have to read your policy very carefully.

Also, if you KNOWINGLY drive (and wreck) an uninsured car and your policy doesn't specifically exclude it, you could be on the hook for wrecking Slob's car. Although again, that's the exception, not the rule.

On the flip side, in the majority of states with no-fault medical coverage, it follows the person, NOT the car. So if you're hurt driving Slob's car, or even if you slam your hand in Slob's car door, your insurance company pays the meds. That's the rule, not the exception.

Your insurance company will want to know that your wife drives your car for underwriting purposes. It is not irrelevant - I'd wager that when you took out your policy and put your John Hancock on the dotted line, there was a provision in there that requires that you keep them informed of all potential drivers in the household.

If the wife has a wreck and you've hidden the fact that she drives the car, you could be facing a big jump in premiums -- or, if you lied on your initial contract about having another driver in the house, they could void your policy from inception for fraud; especially if you concealed it to avoid problems with her license or her record.

The insurance company has the right to know what sort of risk they're writing. And I'll bet a shiny new dime that they have your signature on a piece of paper promising to tell them.

So tell the truth and shame the Devil!

Answer 4

From a liability coverage stand point insurance follows vehicles. There is a possibility though, that if you drive someone's car that is uninsured your insurance will step in as secondary coverage for you. So yes, it does matter if you drive Slob's car and he has no insurance whether you have insurance of your own.

In some states medical payments coverage follows people, so regardless of whose car you occupied you'd get your bills paid through your own. It just depends on the state you're in and the laws that apply.

You need to insure your wife on your policy, but she is automatically considered an insured under your auto policy by definition. If you don't and she has an accident, they'll just add her to the policy later, and rate the policy for whatever risk she is. And depending on the company, etc. you could be considered a fact-misrepresenting-possibly fraudulent- insured. So do the right thing and insure her. It's NOT irrelevant.

Answer 5

I agree with the answers listed so far. Your insurance will cover your car and would be considered excess coverage on someone else's vehicle you drive in respect to your liablility and medical. Of course I would suggest that you be very careful who you loan your car to and who's car you drive, because any accidents that happen may affect your rates.

As for your wife... if you are married, you need to have your wife listed on your policy. Your insurance company could deny a claim if you purposely withhold information from them. Your rates are based on the household risk. If your wife has a bad driving record, they have a right to charge the appropriate premium.

I urge you to talk to your agent about your concerns. We all hate to pay for the insurance, especially if its expensive. But cutting corners is never a good idea when it comes to insurance. You will regret it if you ever have a claim. I've seen more than one person drop their coverage, or lie about a situation and then wreck their car the next day or week. They always regret it!!

Answer 6

Well, you have the correct answers from an insurance agent on the rest of your questions, but no one has answered why you wife has to be named on the policy, so let me try to answer that part for you. You share a car, and live in the same household. She needs to be named on the policy as a secondary driver in that case. If you have a son, and he turns 16 and gets a license, he needs to be named on the policy also as long as he lives at home. I've heard of some companies being so strict they will insist on room mates being named on the policy, but that's rare, usually it's those in the same household that are related that are named.

If on the other hand your spouse is a horrible driver with a DUI conviction for example, you can have him named on your policy as a excluded driver, and your rates will drop as a result. But if he ever drives your car and is stopped or has an accident, your car may be impounded or the insurance may refuse to cover it.

Answer 7

I know on my insurance card, it says "Named Insured" and next to there is my name. So, I think it makes sense that the insuracne willl cover me regardless of the car I am driving. It's kind of similar to when I rented a car not too long ago. I used my own insurance, as opposed to what they offer you when you rent the vehicle. Therefore, if anything happened, my insurance company would have been held responsible for making any necessary payments.