Borrowed Car Accidents: Who Pays?

Getting a driver’s license can open up an entirely new world, even if you have to borrow someone else’s car until you buy your own. Maybe you have friends who lean on you to help cover their transportation needs. Either way, when someone borrows your motor vehicle, it’s normal to worry about them getting into a car accident.

Despite that fear, people lend their cars, trucks, and SUVs to their friends and family all the time. Auto insurance coverage shouldn’t matter because the person driving their car won’t get into a car crash, right? What happens if your worst fear comes true and they do get into an auto accident? Who pays for the damages sustained by the accident victims?

This article examines what happens when someone gets into a motor vehicle accident in a borrowed car. It also explains whether your car insurance company will cover the victims’ injuries and financial losses.

If someone borrowed your vehicle and got into an automobile accident, contact a personal injury lawyer. They’ll explain your legal rights and advise you on how best to proceed.

Car Insurance Follows the Car, Not the Driver

There’s a common misconception that car insurance follows the driver. In fact, the opposite is true. As long as the person who owns the vehicle has coverage, anybody who drives it will have coverage as well.

If the person driving the car gets into an accident, the owner’s car insurance will offer primary coverage. Should the owner’s insurance policy limits not cover the accident victims’ damages, the driver’s insurance would be secondary coverage.

State law dictates how auto insurance works. Check with your jurisdiction’s Department of Insurance to learn more about filing a car accident claim.

Excluded Drivers

While insurance typically follows the vehicle, there are a handful of scenarios in which the owner of the vehicle may not be liable for damages caused by the driver of a borrowed vehicle.

These situations include:

• The vehicle owner’s insurance policy specifically excludes the driver
• The driver took the car without the owner’s permission

When you apply for car insurance, the insurance company asks you to list everyone in your household. Some car insurance policies cover all household members, while others only cover family members with a driver’s license.

The insurance company may exclude a person from your insurance policy for various reasons, such as:

• They have a poor driving record and have filed numerous auto insurance claims
• The individual has prior convictions for DUI, and covering them would significantly increase your insurance premiums
• The person is not a licensed driver

Some states, like Kansas and New York, don’t allow exclusions. If the excluded driver gets into an accident while driving your car in any of these states, they will become liable for any resulting damages.

Liability for Bodily Injury and Other Damages

Standard auto insurance policies include liability for bodily injury. This type of insurance covers damages the insured causes to another driver and their passengers.

These damages may include (but are not limited to) the following:

• Medical bills
• Lost wages due to time off from work for recovery
• Lost future income
• Future medical expenses
• Property damage
• Pain and suffering

In the context of a borrowed car accident, the car owner’s insurance policy is generally the primary insurance that kicks in. This means their bodily injury liability coverage would be the first to pay for the other party’s medical expenses up to the policy limits.

If the damages exceed the owner’s policy limits, the driver’s insurance may be able to cover the remaining costs. This is assuming that the driver has their own insurance coverage.

Who Is Liable for Damages: The Vehicle Owner or the Driver?

It can be difficult to establish whether the vehicle owner or the driver is liable for damages in a car accident case. The owner’s insurance coverage usually pays the damages resulting from the accident. However, there are times when the vehicle owner may be personally responsible for these damages. Let’s examine some of these situations.

Negligent Entrustment

Negligent entrustment is when a car’s owner lets someone use their vehicle even though they know the driver is unfit or incompetent to operate the car safely. The court may find that the vehicle owner is liable for negligent entrustment for any of the following reasons:

• The person has a history of reckless driving
• The driver has prior convictions for DUI
• The person borrowing the car lacks a valid driver’s license
• The person is under the influence of drugs or alcohol at the time the owner agrees to let them drive their car

In some car accident cases, negligent entrustment trumps the liability of the at-fault driver, shifting responsibility to the vehicle’s owner. The rationale is that the accident might not have occurred if the car owner had not negligently provided the vehicle to an incompetent or unfit driver. In some states, the plaintiff in a negligent entrustment case must prove the owner knew or should have known about the driver’s incompetence when they loaned them their vehicle.

Permissive Use

While negligent entrustment can make the owner of a borrowed car liable, permissive use can help ensure that the owner’s insurance policy will cover damages resulting from a car crash. If the owner of a motor vehicle gives explicit or implied permission to another individual to use their vehicle, most auto insurance policies will extend coverage to that individual.

Because of the permissive use doctrine, if you borrow a friend or family member’s car with their permission and get into an accident, their insurance coverage serves as primary coverage. Not all liability insurance policies include permissive use coverage, and those that do may have restrictions or limits. The specifics of permissive use coverage vary by insurance provider, policy, and state law.

Permissive use doesn’t apply if the person takes the vehicle without the owner’s permission.

Can the Vehicle Owner Sue the Other Driver?

Since auto insurance follows the vehicle, it raises the question of whether the vehicle owner can sue the at-fault driver for damages. The driver in the borrowed car accident may have a valid injury claim against the at-fault driver, but does that automatically mean the vehicle owner will as well?

Most borrowed car accidents don’t involve the vehicle owner. There are times when the vehicle owner may be the passenger in their own vehicle at the time of the accident, such as when they are sick or under the influence of alcohol or drugs. They may ask a family member to drive their car instead. In this situation, the vehicle owner would have the same rights as any other passenger hurt in a car crash.

The only type of claim a vehicle owner would usually file in this type of car accident would be one for property damage. If their vehicle is damaged or destroyed in a car accident, they should be able to pursue the at-fault driver’s insurance company.

Get Legal Advice From an Experienced Car Accident Lawyer Today

Car accident cases are often messy, and it can be hard to determine who is liable for the damages resulting from the crash. Things can get especially complicated when one of the drivers is in a borrowed car at the time of the accident.

The good news is that, in most cases, the vehicle owner’s insurance will cover any losses the accident victims suffer. A car accident attorney can help you navigate the insurance claim process, deal with coverage limits, and, if necessary, file a car accident lawsuit against the responsible party. Contact a local personal injury lawyer to schedule a free case evaluation.