I lend my vehicle to a friend. They obtain full coverage but reg is in my name. Is my liability protected?

Question

Here's the scenario. I lend my vehicle to another party. They obtain full insurance coverage on the vehicle, however the legal ownership, i.e., registration remains in my name. In the event of bodily injury or property damage caused by this other person in my vehicle, is my liability protected? Insurance or law professionals please.

Answer 1

No your liability is not protected. Since you can't insure something you don't own, if they buy a policy with MOST companies, the policy is essentially null & void, they are not protected & you are not protected. Some companies, like Progressive may do this for your friend. If there is damage to the car, the company will pay YOU for that. HOWEVER, if there is a liability issue, the only person that would be protected is the policy owner - which is NOT you. You will STILL be sued for being the owner & allowing them to drive the vehicle. You would have to hire your own attorney with your own money & pay any bodily injury or property damages you are legally responsible to pay.
The best thing to do is to insure it in your name. If this person is borrowing your car for more than a week or is a member of your household add them as a driver on your policy. If you wish, just have them pay the premium but make sure the policy comes to you so you know they did pay & keep the policy in force.

Answer 2

If you own the vehicle then you are responsible for the insurance.
If this third party purchased insurance on the vehicle that they do not own than the insurance company may deny any claims when they find out.

Most major insurance carriers today will cover anyone you give permission to drive the vehicle. As long as it's not used for business, they do not live with you or they drive the car on a regular basis.

My recommendation is to just get your own policy for the car. If your friend drives the car regularly then add him on and have them pay for part of the insurance.

Answer 3

You might look at how RENTAL and leased cars are handled.

They try to sell you all sorts of additional insurance.
I asked my insurance agent about this ... if I am in a rental vehicle, am I covered with the same insurance that I would have on my personal vehicle. Yes but

I have a huge deductable on my personal vehicle.
The owner of a vehicle not want that ... for example personal vehicle being paid in installments thru a bank.

Answer 4

While it is possible to obtain insurance policies when the car is not in your name, be verry careful. At this point i would say no, your liability is not covered.

Also, i would say the car is not trully covered at this point. In order to insure something you must hav "insurable interest" meaning in this case, own the car. your frined is insured... but they could refuse to pay the claim due to this... unlikely, but possible. The best thing to do here, is get the policy in your name, and add him as a driver. Trust me, when it comes to insurance, you dont want to learn from mistakes.... it's expensive!

Answer 5

Never heard of anyone else being able to insure a vehicle not in their name. Did you see this policy? I would check with your own insurance company about this.

Answer 6

My experience tells me that YOU must have the insurance policy in YOUR NAME and have your friend listed as an authorized driver.

My policy will cover anyone I allow anyone to drive my car but not if they are the primary driver.

Check with your insurance agent to protect yourself.

Answer 7

my mom has full coverage and if she lends the car to a friend its covered by the insurance

Answer 8

Be sure that your are named as an "additional insured" on the policy.