Can I insure a car I don’t own?

Depending on the reason why, you can insure a car you don't own by (1) paying the owner's bill, (2) buying a non-owner's policy, or (3) having the owner add you as a driver.

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UPDATED: Jun 2, 2022

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Written By: Laura BerryReviewed By: Joel OhmanUPDATED: Jun 2, 2022Fact Checked

Here's what you need to know...

  • The first way to insure your friend’s car is simply by giving them the money to buy insurance.
  • The second way is by having your friend insure the car and adding you as a driver.
  • The third way is by purchasing a non-owner car insurance policy.

If you are wondering whether or not you can insure your friend’s car, the answer is yes. However, depending on what your purpose is for insuring your friend’s car, there are a couple of different ways that you can go about this.

Most auto insurance policies cover a vehicle owned by the policyholder. However, there are times when you drive a car that is not registered to you but still need insurance coverage for it.

Getting auto insurance coverage for a vehicle that is not yours may be challenging, but it may still be possible. State laws may prevent you from insuring a car you don’t own, so you might have to call either your state DMV or insurance company to see whether it’s legal to have an auto policy that differs in name from the car’s registration name.

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Is it legal for me to pay my friend’s car insurance bill?

There are no laws against someone paying someone else’s bills, no matter what the circumstances might be. Perhaps you are helping out a friend, or you are a listed driver on the vehicle, and you want to pay your part.

However, if you are planning on driving the vehicle regularly and you aren’t listed as a driver on the vehicle, this is considered insurance fraud.

Simply put, a car owner is required to list all of the people on their car insurance that they know will be driving their vehicle.

Some people with a bad driving record enlist their friend’s help by getting them to buy a car in their name so that they don’t have to pay sky-high car insurance premiums.

According to the Cornell Law School’s Legal Information Institute, fraud occurs when you deceive someone or provide misinformation to cause damage. Fraud is a very expensive problem in insurance. Increased fraud levels lead to increased rates for consumers.

Now, you may not be intentionally causing damage, but if you have a bad driving record, then you are a high-risk driver. You are defrauding the auto insurance company financially if you do not reveal that you are the one driving the car because they aren’t able to charge you the appropriate premiums based on your driving record.

If you are a high-risk driver who has caused previous accidents and you cause another accident, then your fraud is taken to a whole new level because now you caused damage in a borrowed vehicle that you normally do not drive.

This kind of damage could lead to a claim not being paid or worse: If the insurance company chooses, they can have you arrested for insurance fraud!

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Is it okay for me to drive my friend’s car if I am a listed driver?

If you are listed as a primary driver of your friend’s vehicle, then you can drive it all of the time and be legally insured. It is important that you are listed as a primary driver so that the insurance company knows how much to include your driving information in the insurance quote.

Adding you as a driver may be the best way to go if you plan on driving your friend’s vehicle regularly.

Usually, two or more names can be on the car title. Once you have your name on the title, you can get an insurance policy for the vehicle, even if you live at a separate address.

A non-owner’s policy will cover you as well, but it can be even more expensive. Some insurance companies don’t even offer this type of policy as an option which limits your choices when looking for multiple quotes for your car insurance.

What is a non-owner’s car insurance policy?

If that’s not right for your situation, the next best option is to get a non-owner car insurance policy.

A non-owner’s car insurance policy is purchased by someone who doesn’t own a car. This type of policy can be general or vehicle specific.

If you don’t own a car but your friend does, and you want to drive their car frequently, you can purchase your own car insurance policy for their car as a non-owner.

Now, you cannot do this without the express permission of the actual car owner.

A more expensive alternative is a non-owner’s policy that is not vehicle specific. This type of policy is designed for people who don’t have a car but want to carry liability insurance if they drive someone else’s vehicle.

This kind of auto insurance policy is also accepted for states that require everyone who has a driver’s license to have car insurance even if they don’t have a car.

A non-owner policy might not be the best for everyone, but if you rent cars or have your car in custody, a non-owner plan might work for you.

It is important to note that a non-owners policy is a liability-only policy.

You cannot get comprehensive coverage or collision coverage with this auto insurance policy, so keep that in mind when you are making your decision about your policy type.

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Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.

A former insurance producer, Laura understands that education is key when it comes to buying insurance. She has happily dedicated many hours to helping her clients understand how the insurance marketplace works so they can find the best car, home, and life insurance products for their needs.

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Written by Laura Berry
Former Insurance Agent Laura Berry

Joel Ohman is the CEO of a private equity backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He has an MBA from the University of South Florida. Jo...

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Reviewed by Joel Ohman
Founder & CFP® Joel Ohman

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