Non-Owner Car Insurance

Non-owner auto insurance is liability coverage for people who don’t have their own car, but still need to drive once in a while.

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Non-Owner Car Insurance

Non-owner auto insurance is liability coverage for people who don’t have their own car, but still need to drive once in a while. 

What is non-owner car Insurance? 

If you own your vehicle, you need to have an auto insurance policy that covers you every time you get behind the wheel. But some drivers who don’t own a car may still need to carry insurance in order to keep their driver’s license, or because they rent cars frequently. In general, you’ll find that non-owner car insurance is a requirement in certain specific circumstances—such as a prior history of DIUs.

Uninsured motorists face stiff consequences if they’re in an accident. After all, one of the first things the other driver in an accident will ask you for is proof of insurance

Not every driver is a vehicle owner. Because drivers could participate in a car-sharing service like Zipcar, or rent cars frequently, some insurers sell non-owner car insurance policies to offer these folks protection from liability.  

Do you need a non-owner car insurance policy?

If you don’t own a car and aren’t on someone else’s auto insurance policy, you’d likely need non-owner car insurance if you:

  • Drive a friend’s car often
  • Participate in a car-sharing service
  • Rent cars frequently
  • Own a business whose employees drive personal cars for business purposes
  • Need a SR-22 or FR-44 because of a DUI or serious traffic infraction
  • Sold your car and will be without one for a brief period of time, but still plan on driving frequently

What does non-owner car insurance cover?

If you’re in an accident when driving a friend’s car and have non-owner auto insurance, what would your policy cover? 

It will depend on your policy and the state you live in, but for the most part you’ll find that liability coverage is the main part of your policy. 

Even if you’re driving a rental car you’re likely to purchase a collision damage waiver to cover some of the coverages you’d expect a non-owner car insurance policy to cover. 

You’ll want to check your own policy carefully, but here are some of the coverages that insurance companies may include in a typical non-owner car insurance policy:

Bodily injury

If the other driver is hurt in an accident, the insurance coverage tied to the owner of the car you’re driving would kick in first. But let’s say they had a limit of $30,000 for medical bills and the actual bills came to $40,000… in that case, the bodily injury coverage in your non-owner auto insurance policy would pay the difference.  

Medical payments

If you or any passengers are hurt in the accident, that’s when medical payments (or MedPay) covers those medical bills.

Personal injury protection

Personal injury protection, or PIP, goes beyond paying medical bills. It also might reimburse lost wages if you can’t work while you’re recovering from an accident, or pay for funeral expenses in a worst-case scenario. 

Property damage

Property damage liability covers the repair costs when you cause damage to someone else’s property, whether it’s a vehicle, building, or fence. What if you accidentally plowed your friend’s car into a building and knocked down a wall? Again, your friend’s insurer would cover the damages up to their liability limits, but then you’d have to pay any remaining difference. This coverage would kick in at that point. 

Rental car liability coverage

Non-owner coverage protects you behind the wheel of a rental car, too. (If you’re only renting a car for a few days’ vacation, the credit card that you use to rent the car might offer protection—be sure to ask!). 

While many rental car companies sell rental car insurance, it’s often more expensive than a non-owner auto insurance policy. If you drive rental cars frequently, see if you can get a few car insurance quotes to compare rates. A non-owner policy will likely be cheaper than the rental company’s insurance rates. 

How much does non-owner car insurance cost?

Because it’s considered secondary coverage, most insurance companies charge less for non-owner coverage. As usual, the rates will depend on the coverage limits and deductible (if relevant) you select when getting car insurance quotes. 

When pricing a policy, insurers look at your driving history. High-risk drivers will pay higher rates regardless of the type of policy they’re buying.

SR-22 non-owner auto insurance

While a non-owner policy is typically cheaper than standard auto insurance, SR-22 insurance is the exception. Motorists who need this type of non-owner insurance have a flawed driving record which means that car insurance companies view them as being high-risk. 

If you’ve had your license revoked for a DUI or serious traffic infraction, you may need a SR-22 or FR-44 insurance policy to get it reinstated. After purchasing the non-owner auto insurance policy, your insurer files the SR-22 form to start the process of getting your license reinstated. 

With an SR-22 policy, you may have to carry higher limits and maintain coverage for two to five years to get your license back. Not all insurance companies sponsor SR-22 policies, so talk to your insurer when soliciting car insurance quotes… and think twice about having a few beers before you hop behind the wheel. 

Please note: Lemonade articles and other editorial content are meant for educational purposes only, and should not be relied upon instead of professional legal, insurance or financial advice. The content of these educational articles does not alter the terms, conditions, exclusions, or limitations of policies issued by Lemonade, which differ according to your state of residence. While we regularly review previously published content to ensure it is accurate and up-to-date, there may be instances in which legal conditions or policy details have changed since publication. Any hypothetical examples used in Lemonade editorial content are purely expositional. Hypothetical examples do not alter or bind Lemonade to any application of your insurance policy to the particular facts and circumstances of any actual claim.