Does Auto Insurance Cover the Car or the Driver?

It is a very common question. Does your auto insurance policy cover you, the driver, or the car? Does your insurance plan follow you or does it follow the car? 

The answer is a bit more complex. The type of policy you have plays the biggest role in this decision. Here is a closer look at some key facts you need to know. All policy owners need to take these things into consideration when filing a claim.

Liability Insurance Coverage - Driver

If you have liability insurance, it follows the driver. In other words, no matter what vehicle you drive, your liability insurance will likely cover your risks. For example, you borrow your friend’s vehicle for the day. You cause an accident. Your liability insurance will cover the damage to the other driver’s vehicle. It provides coverage for the named insured on the policy no matter which vehicle the insured drives.

Comprehensive Auto Insurance and Collision Auto Insurance - Car

This type of car insurance provides coverage to your vehicle. In other words, the insurance policy applies to the vehicle, not the driver. For example, if you are driving a friend’s car and you collide with a phone pole, the insurance applies only if it is on the vehicle. If your friend does not have collision insurance – even if you do – it does not apply. It links to the vehicle specifically.

Comprehensive auto insurance follows the same overall process. However, there may be stipulations in some situations. There are some limitations based on who the policy allows to operate the vehicle. You must give that person permission to operate the vehicle.

Protecting Your Investments

If you own a vehicle, you need to protect it. To do that, you likely need comprehensive and collision auto insurance. This provides protection from damage to the vehicle in most cases. Most of the time, it does not matter who is driving it. Second, nearly all states require liability insurance. New Hampshire is the only that does not. You need this insurance to protect yourself, as a driver.

The combination of both types of coverage are critical. This is the best possible way to protect your interests. Your auto insurance agent can help you. He or she can help create a car insurance policy that minimizes all of your risks. It gives you ample protection against most types of accidents or property losses that can occur. For more information, contact your insurance agent at 817.589.0006.

Other Articles of Interest:

Older Drivers and Safety: Know the Risks

What Happens After Your Car is Totaled?

Can an Electronic Monitoring System Lower Your Car Insurance Rates?