It may seem counter-intuitive to buy car insurance when you don’t own a car but read on to find out when this might be a good idea.
Do You Need Non-Owner Car Insurance?
If you don’t own a vehicle, you may still want to have car insurance. Why? There are a few reasons.
First, if you have been convicted of a serious accident or incident, such as DUI, you probably had your license suspended. In many states, in order to reinstate your license, you need to show proof of insurance or proof of financial responsibility. This is sometimes called an SR-44 or FR-44.
Another instance when you may need non-owner insurance is if you use a car sharing service like Zipcar or Car2Go. A non-owner policy supplements the liability coverage provided by the car sharing company, which usually provides only the state minimum required coverage. If you cause an accident in a shared car, you could end up paying out of pocket, once the low limits are reached.
There are also times when you may want to maintain coverage while you are in between owning cars. This is because auto insurance companies do not like to see a gap in coverage. To them, this signals risk which may lead to higher rates once you apply for coverage again.
Lastly, if you often borrow other people’s cars you may want a non-owner policy. If the vehicle owner has low limits you could protect yourself by supplementing their coverage yourself.
What Does Non-Owner Car Insurance Cover?
Usually, a non-owner car insurance policy covers just the requirements for your state. Of course, you can set the limits higher than the state minimum coverage should you choose. Some areas you could look at for increased coverage include:
Liability – You can increase your coverage for property damage and injuries to those who are not passengers in your car if you are at fault. This will help protect you should you cause and accident.
Uninsured/Underinsured Motorist – If you are in an accident caused by another driver who does not have enough or has no liability insurance, an increase in this coverage could help you with expenses.
Medical Payments – This coverage is a little more flexible. It pays for injuries no matter who is at fault. This may be a good place to increase your protection.
Just remember that non-owner car insurance does not provide collision or comprehensive insurance coverage. This is the coverage that pays for any vehicle repairs or for replacement of the car if it is totaled.
How Much Does Non-Owner Car Insurance Cost?
There are many factors that determine the rate for non-owner car insurance. These include:
- The limits you choose
- Your driving history
- How much you drive
- Where you live
- What type of car you drive
How Can You Save Money on Non-Owner Car Insurance?
The best way to save money on non-owner car insurance is to shop around. Comparing rates from several car insurance companies can reveal potentially hundreds of dollars in savings.
The InsuranceWins form can help. Just provide some basic information and you will be able to compare quotes from companies you know. Then, take your time and decide on the coverage amounts and monthly premium that fits your lifestyle, whether you own a car or not!
