Considerations in Borrowing a Car

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While Shakespeare warned that one should “neither a borrower nor a lender be” in Hamlet, most of us will find ourselves either borrowing a car from someone else or lending our own cars to others at points in our lives.

So much for listening to good advice, eh?

Car insurance should be at the top of your considerations when doing either – borrowing or lending. But while making sure a car is covered by an insurance policy is paramount, it’s not the only thing you should worry about. Here’s a quick rundown of things you’ll need to know before you borrow a car:

  • Is the car you are borrowing fully insured? What company wrote the policy, and what sorts of coverage and policy limits are in place?
  • Who owns the car you are borrowing? Does it belong to a friend or a family member?
  • Do you have permission from the owner – whomever is listed on the title of the car – to use it?
  • Have you agreed to and set terms involved in borrowing the car? This includes specifics such as: How long will you keep the car? What will you be using it for? How many miles will you be driving?
  • Are you familiar with the operation of the car you’re borrowing? For example, if you normally drive an automatic and borrow a car with a manual transmission, can you operate it without difficulty? It’s important to keep things like the size of the car in mind as well.  If the car is significantly larger or different than your primary car or beyond what you’ve had experience with before, give yourself time to become acquainted and familiar with the automobile.
  • Are the proof-of-insurance card and other required documents such as current registration papers in the car? Where are they located? You’ll need them in case of an accident or if you’re pulled over by the police.
  • Do you have your own car insurance policy that may provide further protection and coverage while borrowing a car? A quick call to your agent or insurance company should let you know.

We think this should go without saying, but we’d be negligent to not mention it. Since you’re borrowing a car that belongs to someone else, it should be treated as well as or better as you would treat your own car. That extra step towards caution and being alert when you drive it could go a long way towards keeping you out of a crash or collision.

The Best Laid Plans

Most of the time, borrowing a car will occur without incident. However, despite our best intentions, sometimes accidents will happen. If you’re involved in a collision or crash while borrowing a car, here’s how auto insurance will come into play, and what you should expect:

  • We mentioned car insurance coverage in the first section. It’s important to know the basic details of the policy attached to the car you’re borrowing. Because each state has its own regulatory and business environment insurers operate in, policies can have wide variations. And it isn’t simply state-to-state differences – individual policies from a single company have have differences as well.
  • How long you’re borrowing and keeping a car can impact insurance coverage. Borrowing a car for a day is versus borrowing it for an extended period of time can impact coverage.  If you’re borrowing the car for a number of weeks or months, you may need to be added to the owner’s auto policy as a regular user for the duration just to keep the policy in force.
  • Borrowing a car for business or job related purposes that go beyond simply driving to and from work could impact coverage.  If the borrowed car is being used to conduct business, it may not be covered in the event of an accident.  Personal car insurance policies do not normally cover this sort of use, so a commercial or business policy may be required.
  • Outright negligence will invalidate the policy. If you fail to use reasonable care while driving and cause an accident, coverage may be denied.
  • If you have your own auto policy, your coverage may extend to any borrowed car. Remember to check with your agent or insurer to find out if and when any personal policy may follow you when driving a borrowed car. If the policy attached to a car you’ve borrowed isn’t sufficient because it’s underinsured, your own personal auto policy may be triggered to cover beyond the limits of the policy on the borrowed car.

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