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My granddaughter is borrowing our car for the Prom. Am I covered?

A client called the other day and said that his granddaughter is borrowing his car to go to the prom.  Was he covered?  Was she covered?

 

Volkswagen Beetle crashed through a brick wallCreative Commons License simpleinsomnia via Compfight

 

As always, check with your agent and your carrier to verify.  But here’s how it works with mostly every insurance company that I know of.

The insurance follows the car, not the person.  So if your granddaughter, your friend, your sister, even if your sister’s friend were to drive your car and you authorized them to do so (gave them the OK) and they were to be in accident, there would be coverage for your car and any other damage that occurred as a result of the accident.

I advised my client to make sure that his granddaughter was listed as a driver on her parent’s policy.  All drivers need to be listed on an insurance policy somewhere.  If they are not then this could cause some issues.  There would most likely still be coverage but it could hold up things with the claim.  Meaning it may take a little longer for you to get your payment as the claim rep and the powers that be in the claim office review everything.

Depending on how often the person you are lending your car to drives the car, your insurance company may require you to list them as a driver.  In this example, the prom example, the granddaughter will just be borrowing the vehicle once.  But if you had someone who is borrowing the car more frequently than it is a smart idea to list them as a driver.

That’s among the first questions that a claim rep will ask a person who is an accident that is not listed on the policy, “how often do you drive the car?”  If the answer is anything other than this is my first time, they will demand the driver be listed.

Especially if they are not listed on a policy somewhere else.

Keep in mind Medical Coverage on an Insurance policy follows the person.  So, in this example, if there were to be an accident and the granddaughter were injured, her parent’s policy would pay for her Medical bills.  This, obviously, is assuming that her parents have Medical coverage on their policy.  If the granddaughter has a boyfriend that is also injured, his parent’s policy would pay for his medical bills.

Most people only have a $10,000 limit listed for their Medical coverage.  We have started to recommend you go higher, even as high as $100,000.  This will help you avoid using your Primary Health Insurance and any deductibles and co-pays that are associated with it.

One last thing to consider.  You are putting your liability on the line anytime you let someone borrow your car.  If there were to be an accident in your vehicle you are at risk for being sued.  It doesn’t mean you will get sued but the possibility is certainly there.

Here is a list of the minimum coverages that I would recommend.  You should not go below these limits.

 

My name is Keith Laskey. My goal is to educate the everyday consumer and to help them make intelligent decisions with their insurance policies. Please contact me at my office, 610-948-4830 or Email Me for any insurance related questions or concerns. You can also visit the Ron Black Agency website or like us on Facebook! Thank you for stopping by, have a great day!

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