Can You Insure a Car That's Not in Your Name?
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You might be able to buy a car insurance policy for a car you don't own, but not every insurer — and not every state — will let you.
Even if you can buy a policy for someone else's car, doing so comes with a few risks. Insuring a car you don't own can complicate filing a claim and will make registering the car more challenging.
Note: Insurers will usually let you buy an insurance policy without a registration or title because you generally need proof of insurance in order to register a car. But that may or may not mean you're actually covered by the policy before you've registered the car with the DMV.
Can you get insurance for a car not registered to you?
You can get car insurance for a car you do not own in certain cases, though not every state or insurer will allow it. The main issue comes down to "insurable interest" in the vehicle.
Insurable interest is the idea that you have a stake in the well-being of something you own. Most car owners wouldn’t want to crash their car because of the repair costs and the risk of loss on an investment.
If you are not the owner of the car, you have a smaller stake in keeping the car safe. If you crash a car you didn’t buy, you don’t stand to lose any money, so you might not be as careful in a vehicle you don't own.
State laws may prevent you from insuring a car you don't own
In certain states, registration and car insurance go hand in hand. For example, New York explicitly says that the name on the insurance card has to match the name on the registration. Failure to match can lead to a suspension of your registration, meaning you cannot insure a car you do not own in the state of New York.
This information may not be explicitly detailed on your own state’s DMV page. You may have to call either your state DMV or your insurance company to see whether it is legal to have an insurance policy that differs in name from a car’s registration.
California
In California, the name on the registration and the name on the insurance don't have to match. But since every state (including California) requires you to have car insurance before you can register a car, that means there should already be a car insurance policy on that vehicle.
Even if it's legal, it can be a burden on the owner of the car
- The owner of the car will likely have a lapse in auto coverage if they need to cancel their insurance and pass on the vehicle to you. Whoever has the policy on the car at that moment would have to cancel their policy — which can be expensive when they reactivate their car insurance.
- Unless you live with the car owner, you probably wouldn't be allowed to join their policy.
How to get insurance for a car you don't own
If you have no other option but to get auto insurance for a car you do not own, you will likely need to shop around at multiple insurance companies and talk to several agents before you find one willing to insure you.
We recommend purchasing insurance for a car you don't own over the phone or in person, not online. You want the insurance agent to understand your exact situation. The worst possible outcome is that you buy a policy, then get in a crash and get your claim denied because the insurer didn't intend to sell you a policy.
The key when meeting with an insurance agent is to persuade them of your financial stake in the car. For example, if you can convince your insurance company that the car is your sole way of getting to work, that may work in your favor for securing auto insurance.
The worst thing you can do, however, is lie to your car insurance company about whether you own the car.
- Lying to your insurer is not only illegal, but also would void your policy and make it harder to find insurance in the future.
- Insurance companies work to minimize risk, and anyone who lies to them is considered a large risk to insure.
- If the insurer figures out you lied after an accident, you may be on the hook for all the damage that resulted from the collision.
Remember to be honest with your insurance company about your circumstances.
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Alternatives to insuring a car you do not own
Depending on your circumstances, there may be some viable options to consider before going through the hassle of trying to get auto insurance for a car you do not own.
One alternative is to see if you can be added to the title and registration of the vehicle or have the registration transferred over to you.
In most cases, two or more names can be on the title of a car. Once you have your name on the title, you can take out an insurance policy on the vehicle — even if you live at a different address than the other titleholder.
The next best option would be to get a nonowner car insurance policy. While a nonowner policy won't be valid for registering the car with your DMV, it will protect you while you're behind the wheel of the vehicle, no matter how often you use it.
Add yourself to their existing policy
If you frequently borrow someone else's car, you may be able to add yourself to their policy as an authorized driver.
Insurance companies won't always allow or require you to be added to someone else's policy. The two main things that make an impact are whether you live together and how often you use the car.
Call the insurance company and explain your situation, including whether you live with the other driver and how often you use the car. The company will let you know whether it will allow, or require, you to be added to the policy.
Of course, you can also help out with paying some or all of the insurance bill if you're the primary user of the car.
Add yourself to or transfer the registration of the vehicle
This option may not be ideal for every situation, but if it is possible, it will be the most convenient.
- You can share the registration of the car even if you do not live with the other driver.
- Being added onto a car registration can be simple or a hassle depending on which state you live in.
Indiana
In Indiana, for example, you have to apply for a whole new title. You will have to search your own state's DMV information and follow its rules for adding another name to a car registration. If the car in question is leased, you will need to talk to the leasing company. It may not want you to share the title of the vehicle with someone else.
If you want the title of the car to be completely transferred, you should see if your state allows the original owner to "gift" the vehicle. If the vehicle is gifted, you usually will not have to pay a sales tax on the vehicle. Whether it is a gift or not, you should go to your state's DMV page and follow all the instructions necessary for transferring a car title.
The car owner adds you to their insurance policy
- If the car owner's insurer allows it, have the original owner of the car add you to their insurance policy as a listed driver. This is especially easy if you and the owner live in the same house.
- If you don't live with the owner, your insurer may be less agreeable — you'll have to convince the insurer of your vested interest in the car, as we mentioned above.
- Students living away on campus for school are exempt; they can be insured even if they don't reside at the main address on the policy.
Nonowner car insurance
A nonowner insurance policy will cover you any time you drive a car that doesn't belong to you, whether it's borrowed from a friend or rented from a company.
A nonowner policy will provide you with the proper amount of liability insurance to be able to drive around comfortably.
This policy would be great for nannies who may drive around many children in a family vehicle. If you are a nanny in this situation, the family's car insurance policy would cover you in an accident, but it may not be enough to cover you and the children.
The family's auto insurance company would likely not add you to the policy either, so a nonowner plan would be a good way to stay covered in that situation.
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