California insurance borrow car

There is a difference between liability and insurance coverage if your relative borrows your car and has a car wreck. You are liable, but whether or not there is coverage for the damages caused by your relative depends on the situation.

If your relative drives your vehicle, you (or your insurance company) will ultimately be held responsible for damages and injuries he causes due to his negligence through what is referred to as "vicarious liability". This is when one person is liable for the negligent actions of another person, even though the first person was not directly responsible for the injury. As the owner of the vehicle, you are responsible for those who drive your vehicle, for what your vehicle damages, and those who get hurt (in your car, in another car, or as a pedestrian).

A claim can be made or a lawsuit can be filed against you, as well as against your relative who was driving, for both economic (property damage, medical expenses, wage loss, etc,) and non-economic (such as pain and suffering) damages. Then the question becomes, who will pay?

You purchase insurance to help cover this liability.

If your relative was driving your car with your permission, and you have insurance, he would be covered under your policy's bodily injury coverage for any injury he caused to another driver or passenger as a result of his negligence. If the accident was his fault he is liable, and your insurance will pay because he was driving your car. But does that make you liable, too?

Be aware, though, that if your relative lives in your household and is going to drive your vehicle, you will need to list him or her on your policy as a driver. If your relative does not reside in your household and is going to be driving your vehicle on a regular basis, he or she will need to be listed on your policy as a driver. If he or she does not live with you and he or she will be nothing more than an occasional driver, he or she may not need to be listed as a driver on your policy. You should contact your insurance company or agent to go over the options which best suit your insurance needs.

Once you determine whether your relative is covered by your current policy or if he or she needs to be listed as a driver, you can make an informed decision with regard to lending that relative your vehicle. Remember, even if your insurance covers him or her as a driver on your vehicle, if he or she is at fault in an accident and the damages exceed your liability coverage, then you as the car owner, as well as your relative -- the driver -- can be held personally responsible and liable.

When you borrow a friend's car (with permission), your friend is taking on what is known in insurance-speak as "vicarious liability." In other words, your friend will be responsible for both property damage (i.e. telephone pole) and bodily injury (i.e. pedestrian's big toe), and his insurance will have to cover the damages. You? You're off scott-free, although you might lose a friend if your accident causes his car insurance rates to go up.

If you are a listed, scheduled driver on your relative's insurance policy then yes, you are covered. If you are not a scheduled driver then maybe you will be covered and maybe you will not.

An unscheduled driver can be covered for some types of claims so long as the permissive use was not in violation of the law or the insuring contract. In most cases your friend across the street or relative from out of town -- the occasional unexpected driver -- is covered under permissive use rules. If you are a household resident family member or a regular operator then you are required to be scheduled on the policy for coverage.

For more information on California auto accidents, click on the following articles:

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