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If you do not own a car, you usually do not need car insurance. However, there are cases when you need to borrow a car for personal or business use. You can get coverage even if you do not own a car. Insurance companies understand that there are many scenarios when a person would need a temporary coverage for a car they do not own, including:
- If you are applying for a driver’s license in a state that requires proof of financial responsibility and you do not own a car.
- If you’re trying to reinstate your driver’s license and are required to file an SR22* with the state and you don’t own a car.
- If you often rent cars or regularly drive cars that do not belong to you and are not listed as a driver on the vehicle owner’s policy, a non-owner policy would serve as your primary liability coverage.
- If you want to avoid having a gap in your insurance history while you’re in-between cars, a non-owner policy could help you maintain a history of continuous coverage and avoid being labeled a “high-risk” driver.
This policy is known non-owner car insurance. Not all insurance companies offer this coverage. However, depending on the state in which you live and the insurance provider, this type of policy may provide coverage for:
- Liability – Coverage for third-party bodily injury and property damage claims.
- Uninsured/Underinsured Motorist – Coverage for the named insured and others in your vehicle if a third party is at fault and you sustain injuries.
- Personal Injury Protection/Medical Payments – Coverage for medical expenses and potentially lost wages in the event of injuries following an accident.
Non-owner auto insurance costs vary, but this coverage is usually less expensive than regular policies covering a vehicle. Insurers view those who don’t own cars as less risky because they don’t have regular access to a car and thus, they are less exposed to accidents.
* SR-22, sometimes referred to as a certificate of insurance or a financial responsibility filing, is a vehicle liability insurance document required by most state Department of Motor Vehicles (DMV) offices for “high-risk” insurance policies. A DMV may require an SR-22 from a driver to reinstate his or her driving privileges following an uninsured car accident or conviction of another traffic-related offense, such as a DUI. An SR-22 may be required for three years for conviction of driving without insurance or driving with a suspended license and up to five years for a DUI. If an SR-22 should expire or be canceled, the insurance company is required to issue an SR-26 form, which certifies the cancellation of the policy. Some states accept an SR-22 as an alternative to a deposit in cash or security as proof of financial responsibility.
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