Good friends usually intend to take care of what they borrow. That’s especially true when your friend borrows your car with your permission. You can lend your car out for many reasons: either you weren’t alert enough to safely drive, you were letting your friend test your new ride, or you were doing them a personal favor. But accidents do happen. Can’t friends just work things out between themselves?
Unfortunately, when your friend borrows your car and crashes it, it also becomes the insurance company’s business. Nothing is ever simple when insurance is involved and it can complicate your friendship. You can help prevent conflict with answers to common questions about these kinds of accidents.
Your car insurance likely does not name your friend in the policy. However, most policies cover drivers who have “permissive use.” Permissive use means a driver is covered when they have permission from the owner of the policy. Furthermore, you do not need to be a passenger in the car at the time of the accident. Your policy covers the accident even when your friend is driving for their own purpose. Permission provides the coverage.
However, someone who regularly drives your car should be named in your policy. If you are actually sharing the car, the insurance company may deny coverage and drop you as a customer if you do not name your friend in the policy.
Insurance companies are allowed to deny covering your friend’s accident under the following scenarios:
If no one is hurt, you will likely be preoccupied with your property damage. You first need to know who caused the accident. If another person crashed into your friend, that person’s liability insurance will cover the damage to your car.
If your friend caused the accident, your collision insurance pays the repairs. Unlike liability insurance, a collision policy is optional coverage. That means you may not have it. Check your declaration page to see if you can submit a claim to your own insurance company.
Property damage is a small concern when an accident also results in injuries. Injuries are compensated according to the same rules as property damage—the person at fault is the person who pays.
But here’s the twist: if your friend caused an accident that injured another person, you are the person who pays. When you lend your car, you are also lending your car insurance. That is because accidents follow the car first, the driver second. Expect your premium rates to increase.
And you may not just be paying more for insurance after an accident. Injuries are expensive to treat. In a car accident, it’s not just the medical bills that get compensated. Persons who recover from accidents are also entitled to pain and suffering damages.
Therefore, if a claim exceeds your policy limits, someone will be sending their bills to you personally.
Sustaining injuries as a passenger in an accident is your most personal concern. Your friend will likely also feel concern for you and want you to get compensation for your treatment.
Does your car insurance pay for your injuries, like in the scenario above? Unfortunately, it doesn’t. Even though your friend was driving your car, your liability insurance will not compensate for your injuries. That is because you cannot make a claim on your own liability policy.
In this case, you should pursue a claim on the liable party’s insurance policy. If your friend caused the accident, make a claim on their insurance policy. If another person was responsible, pursue a claim from their insurance.
Even in cases where your friend caused the accident, there may be reasons for them to sue you:
These are also reasons for a third party involved in the accident to sue you as well. Your judgement is also relevant in a case where you handed over the keys to your friend.
We understand that some accidents are more complicated than others. Your friendship can be an additional challenge besides the expensive repairs and medical bills.
A good friend wants you to get the compensation you deserve, but it’s the insurance company who makes the decisions. At Sam & Ash, we do not make claims personal –we make them easier. We pursue solutions that work for you.
If your friend caused your accident, we will consult with you for free on your options. Call us anytime at 702-820-1234. You have friends at Sam & Ash.