If you don't own a car but still drive often using borrowed or rented cars, you may want to look into non-owner auto insurance to make sure you are fully covered.
If you don't have a car of your own, your first thought may be that you can forego car insurance altogether. However, if you're still driving regularly, you may still need an auto insurance policy. Non-owner auto insurance exists for this exact reason, and it's also helpful in certain other scenarios where you find yourself driving a car you don't own.
The purpose of non-owner auto insurance is to cover a driver's liability if they are in an accident while driving a car they do not own. This liability policy will cover the cost of property damage and injuries to others. However, it offers no protection for the policy owner or the car they were operating, whether the car was rented or borrowed. So, if you're injured in an accident, non-owner auto insurance will not cover your own injuries, but it will help protect you from the finical liability of other people's injuries.
It's worth noting that non-owner auto insurance will not cover you at all if you are renting or borrowing a car from someone you live with. If you are driving a vehicle of someone who shares your residence, you should ask them to list you on their own auto insurance policy. This may even be required by the state you reside in, particularly if you are not related to the person who owns the vehicle.
There are a few situations that may lead you to looking into a non-owner auto insurance policy, such as:
You regularly rent a car: If you regularly find yourself behind the wheel of a rental car, a non-owner auto insurance policy could save you money if you typically buy short-term insurance.
You regularly borrow a car: If you find yourself using the vehicle of someone you housesit for, work with, or otherwise do not live with, a non-owner insurance policy could help you supplement their own auto insurance policy in the event of an accident.
You temporarily don't have a car: Planning on getting a car again in the future? Having a non-owner insurance policy in the meantime could help protect your "driver risk" status and get you a lower rate when you switch back to a regular car insurance policy.
You use a car-sharing service: Members of car-sharing services, including Maven, Zipcar, and Car2Go, should consider a non-owner insurance policy if the platforms themselves do not provide adequate coverage. Read the fine print to be sure.
You have been court ordered: People who have committed serious traffic violations may be court ordered to have proof-of-insurance in order to maintain their driver's license, even if they do not own a vehicle. Reckless driving, driving-under-the-influence, and causing an accident without insurance can all lead to this.
Just because you drive but don't own a car of your own, it doesn't necessarily mean you need a non-owner insurance policy. Here's a quick summary of the situations where non-owner drivers may not benefit from a non-owner insurance policy.
You borrow a car from someone you live with, in which case you should be listed on the vehicle owner's policy.
You own your own car, in which case you should have a standard auto insurance policy.
You rarely borrow a car, in which case a non-owner policy likely isn't cost-effective.
You drive a company car, but only for business, in which case the company's policy should protect you.
If you're still not sure whether or not you could benefit from a non-owner insurance policy, compare plans online and talk to an insurance specialist to get your questions answered.
You'll be happy to learn that non-owner auto insurance costs less than standard car insurance. Some state that non-owner auto insurance policies cost 5% to 15% less than ordinary auto insurance (on average), however, your policy is likely going to cost far less. This is because traditional insurance is primarily based on the value of the car you drive, but that is not a consideration with a non-owner auto insurance policy.
Since a non-owner policy does not insure the vehicle you're operating, the main cost factor is you and your driving record. If you have a clean driving record, you could pay just a $30 to $40 per month for your policy. On average, non-owner policies across the country cost roughly $474 per year.
Major insurance carriers offer non-owner policies in all 50 states, but the state you reside in will also impact your rates. For instance, non-owner policies in New Jersey cost an average of $1,090/year (almost twice the national average). Meanwhile, residents of Wisconsin see some of the cheapest rates with an average cost of just $171/year.
While the cost of a non-owner insurance policy can vary widely, you can expect your premium to be substantially lower than with traditional car insurance. Plus, although non-owner policies won't protect you or the car you're driving, they can save you big if you ever cause an accident that leads to third-party property damage or injuries.
If you fit into one of the many scenarios where non-owner auto insurance is consider beneficial, you should definitely compare plans for your local area. As with any policy, be sure to read the fine print and understand your coverage options so that you can choose the best plan for you.