Can I drive an uninsured car on my insurance policy?

You can drive an uninsured car under certain circumstances if your policy allows it, such as (1) a newly acquired car, (2) a rental car, or (3) a temporary replacement.

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Zaneta Wood, Ed.S. has over 15 years of experience in research and technical writing bringing a keen understanding of data analysis and information synthesis to reach a wide variety of audiences. She studied adult education and instructional technology at Appalachian State University as well as technical and professional communication at East Carolina University. Zaneta has prepared technical p...

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Joel Ohman is the CEO of a private equity backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He has an MBA from the University of South Florida. Jo...

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Reviewed by Joel Ohman
Founder & CFP®

UPDATED: Jan 31, 2021

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Here's what you need to know...

  • It’s important to comply with state-mandated insurance laws when you own a vehicle
  • Under state law, it’s the vehicle owner who’s held accountable when they don’t carry auto insurance
  • Failure to comply with compulsory insurance laws can result in fines, penalties, loss of licensure, vehicle impoundment or registration suspensions

Driving an uninsured vehicle can be dangerous. Not only do you have to worry about getting into an accident without a policy to compensate you for your damages, you also have to worry about paying legal fees if you’re taken to court for third-party damages.

This is one of the prime reasons why a majority of states have compulsory insurance requirements.

Carrying your own insurance coverage protects you while you’re driving vehicles that you own. It’s also possible that your policy will provide you with protection while you’re driving a non-owned vehicle with an unknown insurance status.

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Personal Car Insurance Covers More than Just the Listed Vehicles

An auto insurance policy is full of different terms. The terms must be understood if you really want to translate the language of the policy.

One of the terms that’s defined thoroughly is covered autos. As you might assume, a covered auto is a listed vehicle that’s stated on a declarations page of the policy, but that’s not all your policy covers.

Under the provisions of a Personal Auto Policy, there’s coverage provided for owned vehicles and other private passenger cars that meet certain conditions.

Here are some of the unlisted cars that your policy will cover you driving:

  • Newly acquired vehicles purchased after the policy begins
  • Replacement vehicle that is replacing one of the vehicles listed on the policy
  • Coverage while driving a rental car
  • Temporary substitute autos used when your car is being repaired, serviced or stored because of a breakdown or loss
  • Trailers owned by the named insured that can be driven or towed on public roads

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Does insurance follow the car or the driver?

As you can see, an auto policy provides a lot more coverage than you might initially think.

Definitions help you to understand policy provisions, but they don’t necessarily help you solve the biggest riddle in the insurance marketplace: Does insurance follow the car or the driver?

It’s a difficult question to answer simply because insurance can follow the car, the driver, or both depending on the scenario.

Your insurance works very differently if you have a liability loss as opposed to a physical damage loss.

You have to understand how coverage works to fully understand if your coverage is going to kick in when you borrow a car from a friend or family member.

How does liability coverage work?

Liability insurance, which pays for third-party damages and medical bills, will always follow the driver regardless of whose vehicle is being operated at the time.

The only rule is that the vehicle being operated must be considered eligible as a covered vehicle at the time of the loss.

This means that you will have liability coverage when driving a temporary substitute, a replacement vehicle, a trailer and a newly acquired vehicle.

Coverage isn’t afforded in the following scenarios:

  • You have regular access to the car and aren’t a covered driver
  • You are a registered owner of the vehicle and don’t have it under your policy
  • The trailer isn’t in your name
  • The vehicle is owned by someone living in your household

Why does liability insurance follow the driver?

Liability insurance follows you as a driver because it’s designed to protect your assets. Since your assets are still at risk when you’re driving a non-owned vehicle, the company must afford you coverage when you’re in other cars.

Your liability insurance will be deemed secondary and the car’s liability insurance would be deemed primary.

This means your coverage technically kicks in if the claim is denied by the primary insurer or if the vehicle doesn’t have liability coverage at all.

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How does physical damage coverage work?

Physical damage isn’t quite as simple as liability coverage when you’re driving a borrowed car. In most cases, comprehensive and collision is tied to the insured vehicle listed on the policy.

When you’re loaning your car to someone, you’re also loaning your physical damage coverage, but if you’re driving another vehicle your full coverage will more than likely not apply.

Some policies have wording that states that physical damage coverage will carry over to someone else’s vehicle when it’s on the policy.

This depends on the reason why you’re borrowing the vehicle if it’s a household vehicle, who owns the car and whether or not it has insurance.

How will medical payments and uninsured motorist coverage extend?

Like liability coverage, both medical payments and uninsured motorist protection will follow the driver and not the car.

If you’re injured in an accident while borrowing an uninsured vehicle, you have peace of mind in knowing your medical payments or uninsured motorist coverage will kick in to help cover medical treatment expenses.

What are the penalties for driving without car insurance?

The penalties for driving without liability insurance can be steep. As more and more people are caught driving without compulsory insurance, the fines just get to be harsher.

Here are some of the most common penalties enforced all throughout the nation:

  • Fines of up to $1000
  • Imprisonment
  • Suspension of registration
  • Suspension of license
  • Impoundment
  • Community Service
  • Reinstatement fees

It’s the vehicle owner’s job to insure their vehicle. If you’re given permission to borrow a car, always ask if it’s insured. Getting caught in the car could result in a huge hassle.

If you’re in an accident, your liability coverage will protect your assets and wages but your physical damage may not apply. Be sure to review your insurance and see if coverage applies.

If it doesn’t, retrieve insurance quotes through an online auto insurance comparison tool and see if you can find a policy with more coverage and better provisions that suit your needs.

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