Typically most insurance companies will want you to have insurable interest in the vehicle in order to get insurance on it. Having insurable interest means being an owner of the vehicle, co-signer or lien holder.

Some CarInsurance.com companies require that your name appear on the title or registration in order to be able to purchase an auto policy in your name. There are some insurance carriers, such as Esurance, though that allow you to insure a motor vehicle without having insurable interest in it.

So it may be possible for a car to be owned and registered by one person and insured be in another person's name but it will depend upon state insurance laws and insurance companies' guidelines if it can be done in your state and for your situation. Even in this situation, the owner my be listed on the policy.

A car cannot be owned by one person and insured under another person's name though for the purpose of getting cheaper insurance on the vehicle. If you want someone to insure your car, which they do not own, you and the other person will need to make sure the insurance company understands the situation and permits it. If you instead do not inform the insurance company properly and only set up insurance in this manner as a way to reduce the insurance costs, most states will find this to be misrepresentation, a form of insurance fraud.

We contacted the Virginia Department of Motor Vehicles (DMV) to see if it was lawful to have a car registered in one name and insured by another. Their response was that as long as the vehicle is titled/registered in your name, you are required to maintain Virginia liability insurance. DMV's only concern is that the vehicle is covered with Virginia liability insurance by someone that an insurance company will cover.

The DMV went on to say you would need to discuss this matter with the insurance company involved to make sure they allowed it and would cover a car registered to one person but insured by another. If the person insuring the car was to cancel their insurance on this vehicle and it was still titled in your name, you would be held responsible. The penalty for a vehicle with current active registration and no insurance in Virginia is: Suspension of driving and vehicle privileges, a $500 statutory fee, an $85 reinstatement fee, and the requirement to obtain SR-22 insurance.

The VA DMV noted that if you were thinking of selling a car to another person and holding onto the title until it was paid off, and thus the reason the car would be registered under your name but insured by the buyer, that you need to be aware that you cannot lawfully sell a vehicle without signing over a title to the buyer. If you were to sign the title over to the buyer, and list your name on the title as the lien holder, you will be given the title until the lien is satisfied and this is the lawful way to sell a car but keep the title until the vehicle was paid off.

You can contact the VA DMV directly if you have more questions about the laws surrounding registration and the insurance that is required to be held. If you want someone else to insure our vehicle make sure their insurance company is aware of the situation completely, whatever the reasoning is behind that you are not insuring your own vehicle, to make sure the policy would cover the vehicle and they could not claim there was misrepresentation.