A Driver’s Guide to Non-Owner Car Insurance

Just because you don’t have a car doesn’t mean you don’t need car insurance. If you cause an accident while driving someone else’s vehicle, you may need non-owner car insurance to help pay for any damage or injuries you cause.

What is non-owner car insurance

Non-owner car insurance is a type of policy you can get even if you don’t own or lease a vehicle. It only applies if you cause an accident and the vehicle owner’s policy won’t cover you, or if their policy’s coverage limits are too low to pay for damage and medical bills you cause.

If you borrow a friend’s car and cause an accident, the owner’s insurance will likely cover both the driver and the car. However, some insurers may not cover drivers who aren’t named on the policy. And even if your friend’s policy does cover you, it may not have enough coverage to pay for all of the damage you caused, which still leaves you at risk if you don’t have non-owner insurance.

Non-owner car insurance vs. permissive use car insurance

Most auto insurance policies will cover the policyholder and anyone else listed on their policy, including spouses, children or roommates. But coverage can also extend to other people that the policyholder allows to drive their vehicle. This is called permissive use car insurance.

While it might seem easier to skip insurance and rely on someone else’s policy, the details of permissive use car insurance can vary. Some policies don’t cover relatives or roommates, while others offer reduced coverage to drivers who aren’t named on the policy. So if you drive someone else’s vehicle often, you should ask to be added to their policy just in case.

Who needs non-owner car insurance?

A non-owner auto insurance policy may not be necessary in every situation, but there are a few scenarios where it can be valuable.

You often borrow other people’s cars. Car insurance follows the car in most cases, so the owner’s vehicle should cover you if you cause an accident. But if repair costs exceed the owner's liability limits, you’re responsible for the rest. For example, if you cause an accident while driving a friend’s car and the other driver has $35,000 in medical bills but your friend’s policy only has $25,000 of bodily injury liability coverage, you’re responsible for the remaining $10,000. A non-owner policy could cover that.

You rent cars frequently. You’re required to have liability coverage to rent a vehicle, and non-owner insurance might cost less than regularly buying a rental company's liability coverage. This type of policy typically won’t cover damage to the rental car, but you may be able to get that coverage through a credit card or from buying the rental car company’s collision damage waiver.

You frequently use a car-sharing service. Car-sharing services such as Zipcar and Turo offer some coverage for drivers, but it’s often just enough to meet your state’s minimum requirements. If you cause an accident, costs could easily exceed the minimum limits. A non-owner policy can supplement this coverage.

You need an SR-22 or FR-44 form. Your state may require either an SR-22 or FR-44 to reinstate your driver’s license after a serious conviction like a DUI. Insurers file these forms on your behalf to prove that you have at least the minimum amount of insurance coverage mandated by your state. If you don’t own a vehicle, a non-owner car insurance policy might be enough coverage to file an SR-22 or FR-44.

You want to maintain continuous coverage. Going without auto insurance makes you look risky in the eyes of insurers, leading to higher rates. So it may be cheaper to buy non-owner insurance rather than skip coverage if you’re in between cars.

Who may not need non-owner car insurance?

There are a few scenarios where you may not need a non-owner policy even if you borrow or rent cars.

You typically borrow a car from someone in your household. If the vehicle you drive belongs to someone you live with and their policy extends to people in their household, you may be listed as a covered driver. However, this can vary depending on where you live and which insurance company your household uses.

You regularly borrow the same car from someone you don’t live with. Car insurers may require customers to include anyone who regularly drives their vehicle on their policy, regardless of whether they live together. If you frequently borrow your neighbor’s car, or if you’re a nanny who drives your client’s car to run errands, you may already be covered under the owner’s policy.

You often drive a company car. If you drive a business-owned vehicle, the company’s commercial auto insurance policy should cover you — even when you drive the vehicle for personal uses. But coverage varies by state and company, so make sure your employer has commercial auto insurance and it covers personal use.

You drive rarely or not at all. If the extent of your driving is renting or borrowing a car a couple times a year, non-owner car insurance might not be worth the expense. It may be cheaper to simply buy insurance at the rental counter or rely on permissive use car insurance through your friend’s policy to cover you if you cause an accident.

Non-owner car insurance cost

Typically, a non-owner car insurance policy costs less than traditional auto insurance. But if you need your insurer to file an SR-22 or FR-44 form, or if you want increased coverage limits on your policy, your costs will likely be higher.

Your driving history affects the cost of your insurance even though a non-owner policy is different from a traditional one. Other factors that affect car insurance rates can include your age, location and insurance history.

Where to buy non-owner car insurance

We’ve verified that a few of the best auto insurance companies offer non-owner auto insurance:

Based on our research, many insurers don’t advertise non-owner care insurance policies on their website. You’ll need to speak with an agent to find out if you can get a policy.