Jessica Sautter is a Content Writer for CarInsuranceCompanies.com with a Bachelor’s Degree from Eastern Michigan University in Elementary Education with a Major in Reading and a Minor in Mathematics.

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Chris Harrigan has an economic degree from Limestone College and an MBA from Clemson University. He previously managed auto insurance claims for Enterprise Rent-A-Car. Currently, he is using his business and insurance expertise to provide insurance data analysis and visualizations to enhance the user experience.

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Reviewed by Chris Harrigan
Former Auto Insurance Claims Manager

UPDATED: Sep 21, 2020

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Key takeaways...

  • Non-owners liability insurance covers licensed drivers who operate a motor vehicle that they do not own
  • When selecting non-owner liability insurance, keep in mind that it’s best to purchase an individual annual policy
  • When someone drives a borrowed car, the car is protected by the owner’s car insurance policy
  • Non-owner liability insurance differs from permissive use coverage. Permissive use coverage is for temporary operation of a motor vehicle for a one time use only

Non-owners liability insurance covers licensed drivers who operate a motor vehicle that they do not own. This includes loaner cars, leased and rental cars and borrowed cars.

The car insurance policy coverage is designed to provide limited liability protection for drivers when they’re at fault for an accident that results in property damage or bodily injury. Not all car insurance companies provide non-owner policies.

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Table of Contents

What is non-owner liability insurance?

  • It’s liability insurance coverage for anyone who does not regularly drive a car and does not have regular access to any vehicle
  • Non-owner liability insurance is required by independently owned private car rental companies
  • Does not cover company or commercial vehicles
  • It provides coverage for damages to third parties caused by the non-owner driver
  • Secondary coverage is available that includes PIP (personal injury protection)

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Non-Owner Insurance Policies Do Not Include:

  • Fire
  • Natural disasters
  • Damaged windshields
  • Deliberate acts of vandalism
  • Intentional or malicious damages
  • Flying or falling debris or loose objects
  • Contact collisions with wildlife or birds
  • Damages that occur as a result of a rear-end, side impact or head-on collision

Receive a Quote to Find Cheap Non-Owners Liability Coverage

In order to find cheap car insurance rates for non-owners liability car insurance, enter your zip code to request a free rate quote.

Once the results appear, select a provider from the list and then contact the company and ask to speak directly to a personal insurance product specialist.

Because this is specialization car insurance, pricing for this coverage won’t appear as it would for a regular vehicle that’s driven daily by one owner.

Where to Purchase a Policy

When selecting non-owner liability insurance, keep in mind that it’s best to purchase an individual annual policy.

Buy a policy only from an independent insurance agent or accredited insurance broker.

There’s usually a higher priced insurance that’s sold by rental car agencies, it’s offered as a part of the fees associated with renting a vehicle.

Usually, the rates are lower for non-owner policies and there aren’t any mandatory deductible limits.

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The Basic Considerations For Non-Owners Liability Insurance

  • It’s competitively priced

  • Does not include rental car reimbursement
  • Differs from SR22 non-owner insurance
  • Non-owners are held liable for bodily injury to a third party and property damage
  • Does not offer financial protection if the rental vehicle is physically damaged by the driver

The purpose of non-owner insurance is to provide limited liability protection for anyone who regularly drives a borrowed vehicle.

Rental car agencies do not offer any form of cheaper coverage, their insurance comes standard, and protection is provided for a daily fee.

The auto liability insurance coverage offered by the rental car agency is compatible with non-owner insurance.

Should you buy non-owner liability insurance?

If you regularly borrow a relative’s car for work or pleasure, then you should purchase a non-owner policy. When someone drives a borrowed car, the car is protected by the owner’s car insurance policy.

But the non-owner driver isn’t protected because they’re not listed on the vehicle’s registration or car insurance.

Non-owner liability insurance provides financial protection for the policy holder in the event there’s a claim filed against them for damages following an accident.

For accidents where the non-owner is not at fault, the other driver’s insurance will pay for the damage to both vehicles and bodily injuries.

Then what is not covered by their insurance is picked up by the non-owner liability policy.

Auto Insurance Quotes

Since non-owner insurance is not widely advertised, it’s wise to gather as much information as possible before committing to purchasing a policy.

Take advantage of the free rate quote to perform a cost analysis to see if this type of coverage is exactly what you need. Get started by filling out the form.

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Types of Non-Owner Liability Insurance Coverage

  • Non-owner insurance for small business owners-Protects business owners when employees are regularly required to run errands and travel for business-related purposes in their own vehicles
  • Non-owner insurance for hired business vehicles-Covers drivers when a business rents or leases vehicles that aren’t owned by any employees or the business. Protection is provided for all vehicles that are solely used for business purposes and aren’t registered to anyone related to the business owner or employees

Multiple Drivers Are Not Covered

Each state has clearly defined rules, regulations regarding non-owner insurance. So it’s important to understand that other drivers in the household are not covered by an individual policy.

No coverage is available for prospective policyholders who have regular access to multiple vehicles located at the same household.

Summary

It is possible to find cost-effective non-owners liability insurance coverage. Ask for a free rate comparison to examine different offers from multiple carriers.

And then contact the insurance company which offers the cheapest price but also provides good service and other benefits.

Just remember that this type of insurance is limited in inclusions because there isn’t any collision and comprehensive coverage.

In the event that you later decide to purchase a vehicle, the policy will be rendered null and void. Coverage is only provided for vehicles that are not owned by the policyholder or a relative.

Non-owner liability insurance differs from permissive use coverage. Permissive use coverage is for temporary operation of a motor vehicle for a one time use only.

However, there are many exclusions for permissive use, do not rely on the owner’s insurance to protect you if you’re involved in an accident.

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References:

  1. https://www.thebalance.com/understanding-minimum-car-insurance-requirements-2645473
  2. https://wallethub.com/edu/non-owner-car-insurance/9833/
  3. https://www.thebalance.com/does-car-insurance-cover-a-natural-disaster-527194
  4. https://www.thebalance.com/will-my-insurance-replace-my-windshield-527112
  5. http://www.nytimes.com/2012/08/25/your-money/auto-insurance/how-to-know-if-you-have-enough-auto-insurance.html