If someone else is driving your car and gets in an accident, your car insurance will likely cover any resulting damage, which means the claim will go on your insurance record and could affect your rates. On the other hand, if your car is taken without permission or the driver is not licensed, the driver is responsible.
Remember, using your insurance means you are liable for paying your deductible, even if it’s a friend (and not you personally) who crashes your car. Fortunately, your friend’s insurance can help if the damage exceeds your coverage. For example, if your policy covers up to $45,000 and the damage is $55,000, the driver's insurance can cover the final $10,000.
However, that isn’t the case if you’ve specifically excluded the driver from your policy. You might choose to leave someone off your insurance because they are a high-risk driver and expensive to insure - like a new driver with multiple speeding tickets, or someone with DUIs on his or her driving record. If that excluded driver crashes your car, your insurance company will refuse to cover the damage.
Unfortunately, an accident can affect your insurance rates even if you aren’t driving. One accident won’t necessarily raise your premium by itself. But if you were in another accident not too long before someone else crashes your car, your company is likely to raise your premium, retract your safe-driver discount, or even drop your policy.
At the end of the day, one of the best things you can do is consider adding people to your insurance if they regularly use your car. You don’t want to end up with a huge bill if your insurance company denies your claim because of who was driving. Also, make sure your friends have a valid driver’s license and car insurance if they’re using your car.
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