We rely on our cars for so many things: from road trips, errands and carpools to off-roading, hauling or even driving for a rideshare service! And in the midst of your busy life and social activities, you probably don’t have time to worry about whether or not your auto insurance covers everything you need it to.
Our office gets a lot of questions about car insurance and what is (or isn’t) covered. A few of the most frequently asked questions are:
- “Am I covered if someone else drives my car?”
- “Do I really need rental car insurance?”
- “What happens to my policy when I get a new car?”
- “Does my college student need to update their policy before they move?”
- “Am I still covered if I start driving for Uber or Lyft?”
Find the answers you need below and get behind the wheel with confidence!
Q1: “Am I covered if someone else drives my car?”
Typically, a car insurance policy stays with the vehicle. In other words, your coverage will be the primary even if someone else has permission to drive your car. The other driver’s policy will act as secondary or “backup” coverage.
Because your policy protects your vehicle, remember:
- If you let someone borrow your car and they get into an accident, a claim for damages will be filed with your insurer and, in turn, your rates will likely increase. This could make for an awkward conversation about who pays for what.
- If your car is borrowed and the driver gets a speeding ticket, the speeding ticket stays with the driver – as well as the likely price increase for their car insurance.
- If an uninsured driver borrows your car, you could be on the hook for the total cost of whatever may happen. The cost of an accident adds up quickly, especially if other vehicle(s) are involved.
Letting another driver borrow your car is no small favor. The best practice is to contact your insurance broker to make sure you know what your car insurance policy does and does not cover before you hand over the keys.
Q2: “Do I really need rental car insurance?”
This is perhaps the #1 most frequently asked of all FAQs! In the midst of vacation planning, don’t forget to do your homework about whether or not rental car coverage may be beneficial. Your insurance broker will be more than happy to help!
If you are traveling within the United States, your own car insurance policy will often be sufficient without adding rental coverage – with a few important exceptions:
- If you have a high deductible, rental car coverage could be significantly less expensive in the event of an accident. For example, a $200 rental plan would be much easier to budget than paying a $1,000 deductible.
- If you want to protect your current rate, filing a claim for damages against a rental policy may help avoid a rate increase on your personal policy.
- If you only carry minimum coverage, you might be better protected with a rental policy that includes comprehensive and/or collision coverage.
Planning to drive abroad? Your personal policy is valid in the United States and may also include Canada. Otherwise, you will need a separate policy or rental car insurance to help cover any gaps, as well as meeting any requirements of your destination country.
Q3: “What happens to my policy when I get a new car?”
We understand if calling your insurance broker is not at the top of your list after you get a new car – but it’s important to bring them in the loop sooner rather than later.
Let’s say you trade in the vehicle currently insured on your policy for something else. Good news: You won’t lose your coverage for driving a different car off the lot. Most insurers offer a grace period to update the vehicle that is named on your policy. This can range from a seven to 30-day grace period, depending on the insurer.
When you update the vehicle on your policy, the price will likely change. One reason? Your new wheels are probably worth more! Of course, your insurance broker would be happy to give you a free quote before you buy a new car to see how it could affect your pricing.
Q4: “Does my college student need to update their policy before they move?”
Sending your young adult child off to college is such an exciting time! The changes and transitions you are going through as a family may also translate to insurance changes.
- If your child will be living on campus and brings a car, their car insurance policy will need to be updated for an out-of-town move. Each state has different coverage requirements, and location can also affect the rates you receive.
- If your child is not taking their car to college, talk to your insurance broker about any potential “away at school” discounts instead of canceling their policy. Building a history of continuous coverage helps keep their rates lower!
Before their bags are packed, remind your student to hit the books: Most insurers offer a discount for good grades!
Follow this link to find in-depth information about insurance for college students.
Q5: “Am I still covered if I start driving for Uber or Lyft?”
Driving for a rideshare service can be a great side hustle – if you are properly insured.
First things first: Talk to your insurance broker before you start accepting passengers! A personal auto insurance policy typically does not provide coverage for commercial services. If you start driving for Uber or Lyft and fail to tell your insurer, your policy may be canceled for violating the Terms of Coverage.
Protect the income earned from your side hustle with the right insurance. Ask if your insurer offers a rideshare endorsement that can be added to your personal car insurance policy. Otherwise, you may need a commercial auto insurance policy.
Take a closer look at accident protection for Uber and Lyft drivers and five things you need to know about rideshare insurance.
Get Answers to Your Car Insurance FAQs at Webb Insurance
Do you have questions about auto insurance? Our team has answers. Located in St. Charles, Webb Insurance is proud to be an independent insurance agency. Our customers have the ability to choose the policy that best meets their needs and fits within their budget.
We represent top-rated insurers and can provide coverage anywhere in the United States. See all of the companies we represent here.