Even if you only drive on occasion, you still need car insurance to protect you from legal liability when you get behind the wheel. If you don’t own a car and drive infrequently, non-owner car insurance may be right up your alley.
With the myriad of insurance policies available for drivers in all circumstances, non-owner insurance often slips through the cracks. Nonetheless, non-owner liability insurance remains an affordable option for occasional drivers that don’t own a vehicle yet still need protective coverage when they do drive.
THE TRUTH IS THAT MOST DRIVERS HAVE NEVER EVEN HEARD OF NON-OWNER CAR INSURANCE BEFORE
Even if you only drive from time to time, driving without insurance is never worth the risk. Non-owner car insurance fits the bill by offering affordable, limited liability coverage so that you remain insured and legally protected whenever the opportunity to drive presents itself.
Covers the medical expenses of other drivers and passengers in an at-fault accident.
Covers the repairs or replacement of another
vehicle/vehicles in an at-fault accident.
Similar to a traditional liability car insurance policy, non-owner insurance coverage will offer protection in an at-fault accident, i.e. an accident that you cause.
These areas of non-owner coverage will also provide insurance for:
Non-owner car insurance will not cover any personal damages in an at-fault accident, such as to a borrowed or rental car you may be driving. If you didn’t cause the accident, the other party’s insurance will be responsible for paying for medical expenses and damages to your vehicle (in most states).
Last but not least, don’t forget that non-owner car insurance is considered a supplemental policy when borrowing a car.
This means that non-owner insurance will only be used after the primary owner’s liability coverage has been maxed out. Non-owner insurance will provide coverage for you as the driver without a personal vehicle but will be used secondary to a primary liability car insurance policy.
AROUND THE GLOBE, CAR OWNERSHIP COSTS ARE RUNNING HIGH
When you factor in the ever-increasing cost of car ownership and often expensive insurance rates, it makes sense that more and more drivers are choosing to forego vehicle ownership. If you live in a city with a good public transportation system, owning a car may be frivolous and unnecessary.
According to the Economist.com, Shanghai has been confirmed as the most expensive city in the world to buy and run a family car, when taking into account the cost of a new vehicle, road tax or registration, service without major repairs, insurance fees, and fuel costs for 10,000 miles annually over three years.
Other costly international cities that made the list include Sao Paulo, Rome, Berlin, and Amsterdam. New York City is considered a pricey city for vehicle ownership, although total car operation costs have dropped 8.1% in the last five years.
To put it in perspective, here is a closer look at the cost of car ownership.
According to AAA, the average cost to operate and own your vehicle is 70.7 cents a mile which totals a whopping $5,925 annual average (if the car is driven 10,000 miles annually). The main components that contribute to the real costs of owning your car are*:
This, of course, doesn’t consider a vehicle’s actual purchase price. License, registration, and taxes may cost you $567, added to fuel costs at $1009, plus roughly $2318 in vehicle depreciation. Other expenses that factor into the total include financing charges, auto insurance, tires, and maintenance and repair.
If you do decide that it is worthwhile to pay for and maintain a vehicle for necessary transportation, the expenses don’t stop there. If you get into a crash, no matter who is at fault, your vehicle is likely to be damaged. If you have limited liability insurance, you’ll be the one who has to pay for your vehicle damage and/or replacement in an at-fault accident.
These commonly damaged car parts factor into the total cost of a crash and may contribute to billions of dollars in damages throughout the US, as seen in the chart below
If you live in a city like Little Rock, Arkansas, a typical crash could cost you an estimated $2250. In Nashville, Tennessee, these costs may drop to $1574 out-of-pocket – which still isn’t cheap.
In light of these sobering figures, you may decide that owning a car simply isn’t worth the hassle or the expense as an infrequent driver. If you have the means to take advantage of public transportation or borrow a vehicle periodically, personal vehicle ownership may no longer make sense.
A NON-OWNER CAR INSURANCE POLICY WILL OFFER LIABILITY COVERAGE FOR A DRIVER THAT DOESN’T OWN A VEHICLE.
Non-owner car insurance is also limited in that it won’t extend coverage to your personal vehicle if you own one. A basic non-owner policy won’t pay for your medical or vehicle damages; in some instances, extra personal coverage may be available as an add-on, depending on the insurance provider.
You may benefit from non-owner car insurance if you meet the following criteria:
If you own a car, you will need vehicle coverage from a traditional liability car insurance policy. Non-owner car insurance can be used for extenuating circumstances where you may drive another vehicle, whether it is borrowed, rented, or driven commercially.
In addition, if you often drive a car owned by a family member in your household, you will need to be listed as a secondary driver on their insurance policy. In this circumstance, non-owner insurance will not apply since you regularly drive a borrowed car in your household. Non-owner car insurance can be used when you borrow a friend or family member’s car on rare occasions throughout the year.
If you fit the bill for non-owner car insurance, there are several reasons to purchase a policy:
Beyond basic limitations, some disadvantages of non-owner car insurance include:
No coverage for collision: A non-owner insurance policy will only provide liability protection in an accident, meaning your personal medical expenses and vehicle damages won’t be covered. Full collision protection is needed to insure your personal damages in an at-fault accident.
No coverage for owned vehicles: A non-owner policy cannot be used for personal vehicles; basic liability insurance is intended to provide coverage for limited liability protection when driving a vehicle that you own. If you own a vehicle, you should try to find affordable full coverage insurance. This covers you in ways that non-owner coverage doesn’t.
No coverage for work-related vehicles: In some policies, non-owner insurance is limited when it comes to work-related driving. In many cases, a non-owner policy can be used when working as a valet or driving a vehicle cross-country for an auction; however, vehicles that are driven intermittently for business purposes may require commercial auto insurance.
There are a few drawbacks to very limited non-owner car insurance. It’s important to understand from the get-go that non-owner insurance does not provide coverage for:
One of the main reasons that so many occasional drivers are drawn to non-owner insurance is because of the affordable price tag. If you don’t own a car and drive irregularly, there’s no reason to pay full price for even a basic liability auto insurance policy.
NON-OWNER CAR INSURANCE RATES WILL VARY AND MAY START AT $400 PER YEAR ON AVERAGE.
State minimum insurance requirements can impact non-owner rates, up to an estimated $700 a year in a state like Illinois. Nonetheless, even if you fall on the high end of the spectrum, paying $700 a year in non-owner insurance adds up to only $58 per month. If your annual policy costs $400, you’ll only have to shell out $33 a month to drive legally.
DMV.ORG EVEN ESTIMATES NON-OWNER INSURANCE AS LOW AS $200 PER YEAR.
Compare non-owners car insurance quotes today and save on your auto insurance policy. Just enter your ZIP code in our quote comparison form and start saving right now.
Before you sign up for a policy, consider these tips:
It’s important to remember that not every car insurance provider will offer non-owner insurance in lieu of basic liability coverage. You may have to take extra time to research insurance agents that provide the non-owner coverage you’re looking for at an affordable price.
The entire purpose of a non-owner car insurance policy is to protect you as an occasional driver that doesn’t own a personal vehicle. If you get yourself into a driver situation where non-owner insurance doesn’t apply – such as driving a personal vehicle – you could be held liable for thousands of dollars in damages in an accident.