Can I Insure a Car Not in My Name?

Generally, you cannot insure a car that’s not in your name. This is mainly because insurance companies require the policyholder to have insurable interest, along with care, custody, and control over the vehicle.

However, it’s not impossible to insure a car that you don’t own either. There are exceptions that allow non-vehicle owners, particularly if you live with the car owner, and drive the car frequently.

What is Insurable Interest?

Insurance companies typically require someone with insurable interest to purchase auto insurance. So, what is insurable interest? Simply put, insurable interest means if the car gets damaged then you will have a significant amount of financial loss.

Now, the main concern comes down to the point, if you don’t own the car, then why would you have any insurable interest? As you’re not financially responsible to repair the car or finance its replacement.

But if you can prove that you do have insurable interest, for instance if you need the car to travel to work, or if you use it to commute frequently then it does show an extent of insurable interest as you’re dependent on the car.

What Does Care, Custody and Control Mean for Car Insurance?

When purchasing auto insurance, insurers verify insurable interest based on the concepts of care, custody, and control. These factors help insurers assess whether you have a legitimate financial interest in the vehicle, and they play a role in determining your eligibility for coverage. Here's what each term means in this context:

• Care: Who is responsible for maintaining the car, including regular upkeep and repairs.
• Custody: Who physically possesses the car, and where it is stored, such as at their home or business.
• Control: Who has the authority to grant access to the vehicle, including permission for others to drive or use it.

When is it Possible to Insure a Car That’s Not in Your Name?

While it’s difficult and challenging to insure a car that’s not in your name, but it isn’t impossible either. The main requirement to be eligible to purchase car insurance that’s not in your name is to prove that you have insurable interest in the car which includes the following.

You Co-Own the Car

Cars can have co-owners or multiple owners. If you co-own a car with someone in your household, it shows clear insurable interest, as you’re directly a financial stakeholder. So, as a co-owner, you have the right to insure the vehicle. Moreover, you can insure the car under your name, even if another owner is also listed on the title.

You Live in the Same Household with the Policyholder

Whether it’s your family members, spouse, roommates or friends, most insurers require policyholders sharing the same vehicle to live in the same household. This is mainly because it helps insurers evaluate the overall risk factors, and the possibility of insurance claims based on driving history, credit score and insurance claims history.

Also, as the car is kept in the same garage, it helps insurers determine the possibility of unprecedented incidents such as theft, vandalism, fire outbreak, and natural disasters like flood, earthquake and severe storms which could lead to critical vehicle damages, and hefty auto insurance coverage.

You’re Renting a Car

When you’re renting a car, you’re required by law to have auto liability insurance. Unless, you already have a personal insurance policy which includes the mandatory auto liability coverage, and essential optional coverages such as collision insurance, comprehensive insure among others.

You can either purchase a rental car insurance coverage, or you can acquire a personal insurance policy. You can even do both, however that may not be necessary and worthwhile.

So, when it comes to renting a car, you always have the option to seamlessly get a car insurance policy. If you want to purchase rental car insurance coverage you can either do it via the rental car insurance company or purchase it from a trusted auto insurance company.

You Got the Car as a Gift

Let’s say you get the car as a gift from your parents living in the same household. The car that you have officially received as a gift is titled to one of your parents. So, in this case can you get car insurance?

Yes, you can. So, if you’re a minor living in the same household with your parents, then you can get enlisted as a driver in their auto insurance policy. However, if you’re an adult living in a different household, or somewhere far then you can get your own auto insurance policy.

You Have Access to a Company Vehicle from Work

If you have access to a company vehicle from work, it is officially a commercial car which you can use for work related purposes. Whenever you use the car for personal reasons such as going on a trip, or for running errands the commercial auto insurance won’t cover it. Similarly personal auto insurance does notcover business use either.

If you get into an accident while using the car for personal reasons, you will have to compensate a significant amount out of pocket. Moreover, if you’re regularly using the car for your personal reasons, you can get a personal auto insurance policy as you need to pay the company for any vehicle damage while driving the car for personal reasons, which is a direct insurable interest.

So, as you have direct insurable interest, you can get personal auto insurance for a company registered car even if it’s not titled to you.

When it Isn’t Possible to Insure a Car You Don’t Own?

Unless you can prove that you have insurable interest, most insurance companies won’t allow you to insure a car that that's not in your name. Also, if you live in New York, you won’t be able to purchase auto insurance for a vehicle that you don’t own, as it’s a mandatory legal requirement.

Plus, if you can’t prove that you drive the car frequently, or you need it on a regular basis portraying some sort of financial stake and high dependency there’s a high chance that the insurer will identify it as lack of insurable interest. Not to mention, if you drive the car rarely that substantially lowers your eligibility of insuring a car you don’t own.

So, in a nutshell, it won’t be possible to insure a car you don’t own when:

• There’s lack of insurable interest
• You live in a state where it’s mandatory to own a car to get it insured; such as New York
• You rarely drive the car

How to Insure a Car Not in My Name?

Although it’s difficult to prove insurable interest especially if you don’t own the car which makes it challenging to insure a car, it’s still possible to insure a car that’s not registered in your name. So, if you want to insure a car that’s not in your name, here are some tips to secure insurance coverage more easily.

Obtain a Co-Title for the Car

By obtaining a co-title, it means you also own the car which also means you now have insurable interest. To obtain a co-title for the car, you will need to head over the DMV along with the primary owner of the car.

You both will need to fill up co-title ownership forms and submit it to register the car in your name as well. Once that’s done, and the moment you officially become a co-owner of the car, you can easily get the car insured.

Get Non-Owner Car Insurance

If you’re renting a car or borrowing one, it is crucial to stay insured especially to safeguard yourself financially and to stay legally complaint. Most of the states in the U.S. legally require you to have car insurance.

So, to secure yourself financially, and to comply with the auto insurance laws in your state, you should consider getting the non-owner car insurance.

The non-owner car insurance has been specifically designed to financially protect policyholders who either drive someone else’s car or a rented car. But the downside is, the non-owner car insurance policy only includes auto liability insurance.

Join the Same Insurance Policy as Someone in Your Household

If you’re under 18, and if you drive your parents’ car then the most feasible option is to join the same insurance policy with you parent or someone from your household.

Typically, car insurance is very expensive for the youngest drivers, and it’s also difficult for teenagers and young adults between the ages of 16 to 18 to get their own auto insurance policy.

On top of that, if you don’t own a car, it’s not necessary for you to get your own separate car insurance policy, rather it’s better join a policy from someone in household, as it’s cheaper, and easier to obtain.

Opt for Supplemental Spouse Auto Insurance (if you’re married)

Similarly, if you’re married, you can opt the supplemental spouse auto insurance. For instance, if your spouse owns the car, and you drive it every now and then, you can consider getting spouse auto insurance coverage. In this way, you both will get discounts, along with other enticing offers.

Is it Possible to Insure a Car You Don’t Own in Michigan?

The auto insurance laws in Michigan are much more flexible compared to many other states in the U.S. Here in Michigan, you can purchase a personal auto insurance even without owning a car.

But for that you will have to apply for Non-Owner Car Insurance also known as SR-22. The SR-22 is a certificate that’s specifically designed for those who don’t own a car. So, whether you’re renting or borrowing a car, you can purchase the non-owner car insurance to stay financially secure and legally complaint.

The downside of the non-owner auto insurance coverage is it only covers the minimum auto liability coverage. Plus, it’s significantly more expensive compared to standard auto insurance policies.

If you interested to purchase car insurance as a non-vehicle owner in Michigan, it is important to explore a reliable auto insurance agency offering the best car insurance solutions at the cheapest rate. Additionally, you can visit our regional offices in Flint, Saginaw and Mt Pleasant.

Can I Add My Insurance to My Son's Car?

Yes, you can add your son in your auto insurance policy by enlisting him as a driver there. If your son’s age is between 16 and 18, the cost of auto insurance can be among the highest.

So, that’s why it’s best to add your son’s car to your auto insurance policy. Although you will have to pay a significantly much higher auto insurance premium, it will still be much cheaper than your 16-to-18-year son to acquire auto insurance on his own.

On the other hand, if your son is above 18 with a stable income you can still add him in your policy if your son lives in the same household and frequently drives your car.

Rely on Permissive Use

Even if you drive a car that you don’t own, you don’t necessarily need to get insured. Whether you’re borrowing your parent’s car or spouse’s one, you can still legally drive with permissive use.

So, if you get into an accident, and if you don’t have auto insurance to cover the costs, don’t worry. With permissive use, the insurer will cover the medical bills, car repair costs, and liability compensation based on the policyholder’s auto insurance policy.

Although you should only consider this option as a last resort, remember at the end of the day you’re relying on someone else’s auto insurance coverage. So, try to get your own auto insurance policy as soon as possible, in this way you can have your own financial safety net.

Consequences of Insuring a Car Not in Your Name

Although it’s essential to have car insurance even when you drive a car that you don’t own, there are potential drawbacks to insuring a car that isn’t in your name, which includes the following.

Claim Denial: Your insurer may decline your claim if they find reasons for lack of insurable interests. This could get you caught up in financial hassles which you may need to pay out of pocket.

Possible Insurance Fraud Accusations: There have been several cases of insurance fraud by adding policyholders who don’t have a car, especially to get auto insurance at a cheaper rate. If your insurer suspects any sort of fraudulence, then it can lead to issues such as claim denials, policy cancellation and even legal consequences.

Higher Insurance Cost: Insurance companies typically charge non-vehicle owners more than the standard rate. So, purchasing insure for a car that’s not in you can lead to significantly much higher premiums.

The Bottom Line

Regardless of the challenges, and difficulties there are ways to insure a car that’s not in your name. But before doing so, you should carefully evaluate whether it’s necessary. If you drive the car frequently, and if you need it on a regular basis only then you should consider insuring a car that you don’t own.

On the other hand, if it’s a rented car then you can either get car rental insurance, or you can get a standard auto insurance policy. Before making a decision make sure you properly weigh the pros and cons.

If you need expert opinion of our auto insurance specialists, you can contact us and one of our insurance experts will call you soon. If you’re interested to purchase auto insurance for a car that’s not in your name, we can provide you with a free quote.

FAQ

Can you insure a car you don't own?

Yes, you can insure a car you don’t own but you will have to prove that you have insurable interest in the car. If you can effectively demonstrate financial stake in the car then most insurers will consider you eligible. However, if you can’t then insurers may be hesitant to insure you.  

Does the owner of a car have to be on the insurance?

Yes, it is mandatory for the car owner to have auto insurance. Without proof of insurance, you cannot register a car in your name at the DMV.

Does it matter whose name is on the car for purchasing insurance?

Yes, insurance companies typically validate insurable interest and financial stake based on the name of the registered car owner.  

How do I insure a car that isn't mine?

If you want to insure a car that isn’t yours, you will need to prove insurable interest and show that you have financial stake in the car. So, you can become a co-owner of the car, get non-owner car insurance, join the car owner’s insurance policy etc.