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nonowners car insurance

How to insure a car that’s not registered to you

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It’s challenging to get insurance for a car you don’t own if your name isn’t on the title. Most insurance providers want to see you have insurable interest in the car, making it difficult to insure a car that’s not registered to you. But you’re not at a complete loss if you’re looking to get insurance on a car you don’t own if you can find the right insurer with non-owner car insurance.

When would I need non-owners insurance?

  • You will be driving someone else’s car for an extended period of time and you are not listed as a driver on their insurance.
  • If you’ve gotten into trouble behind the wheel and are required to file an SR-22 or FR-44, you also might be required to obtain non-owners insurance if you intend to drive, even if you don’t own a car.
  • If you are applying for a driver’s license, some states require proof of financial responsibility even if you don’t own a car.

How to get nonowner car insurance

If you don’t own a car, but need insurance to drive one, opt for non-owner car insurance. Non-owner car insurance allows you to drive someone else’s car and be protected.

Typically this insurance only provides liability coverage, not optional coverage like damage to the car, rental reimbursement or medical expenses.

But on the plus side, this type of insurance usually costs significantly less than a typical insurance policy, based on the assumption that you’ll be driving less and thus be less likely to have a wreck.

What is insurable interest?

Typically, if you own something — in this case, a car — you’re considered to have insurable interest in that item, giving you a stake in what happens to the car. If the car were to be damaged, totaled or stolen, you would suffer financial loss. Most insurance providers won’t insure your car if you cannot prove insurable interest, which is difficult if you aren’t the owner.

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Add your name to the title

In some states, your name must be on the car’s title in order to insure the car. In this case, the simplest thing to is add your name to the title or transfer the title to your name.

But beware — fully transferring the title to your name comes with high taxes. It’s better to have the owner gift you the car to avoid paying extra taxes.

Prove to your insurer you need the car

Some car insurance companies will bypass their own rules if they see that there is a definite need for the car in the driver’s life. Explaining to the insurer that you need the car to drive to and from work every day because there is no public transportation available to you, and that you’ll have constant control of the vehicle, is enough to get them to write you an insurance policy.

If you live in a state where your name isn’t required to be on the registration, convince the insurance agent that you have a financial stake in the car. Be honest in your current situation and explain why you’re not able to own a car at this time but need to drive one.

Proving you have a job you need to drive back and forth to, children you need to take to and from school or some other reason will help prove to insurance providers that you have just as much stake in the car as the owner does.

How to apply for non-owners car insurance

  • Call your chosen or current insurer and inform the agent that you need a non-owners policy.
  • Give the agent the driver’s information and whether an SR-22 is required. In most cases, the insurance company files an SR-22 directly with your state.
  • Confirm coverage and set up payments to begin coverage.
  • Wait for proof of insurance and keep it in the car.

Shop around until you find the right company

If none of these options work for you, there are a few insurance providers out there that will write you an insurance policy, but shop around. If one provider refuses you, ask for specific reasons why to help you improve your case for that provider or another one.

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Why is it so hard to insure a car that’s not mine?

If you don’t have insurable interest, then it’s hard for insurance companies to outweigh the risk of insuring someone who doesn’t own the car. The person driving the car could easily just damage the car themselves if the owner ever gets on their bad side — with no penalty to the driver of the car.

And to take it even further, if insurance companies were willing to insure cars that an individual didn’t own, then what would stop someone with a bad driving record to ask their friend to insure their car for them, in order to get a lower rate. This can easily get car insurance companies into very tricky territory.

Does the car’s owner have to make the car insurance payment?

If you’re able to convince the owner of the car to add you to their insurance policy, this doesn’t mean that they have to make the payment each month. Make the monthly insurance payment for the owner of the car yourself. You can even set up automatic recurring payments.

Bottom line

While you might be able to find a way to get insurance for a car you don’t own, it might be difficult to find the optimal solution for you and the car owner. The key is to prove to insurance companies that you need to use the car and you have to be the one to set up the insurance. Compare all car insurance providers to find the right one for your situation.

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