Non-owners car insurance – a comprehensive guide

Do you need car insurance but don’t own a car? Drivers who don’t own a car might need car insurance, too.

Non-owners car insurance is designed for people who need to be insured but don’t own a car. It’s affordable and easy to get, so there’s no reason not to protect yourself and your loved ones.

Among the many types of car insurance, non-owners car insurance is the one for you if you don’t own a car. It typically costs less than regular car insurance because it only covers the driver’s liability in the event of an accident.

Compared with a standard insurance policy, non-owner car insurance does not have a deductible, which means you don’t have to pay any money before your insurance company comes into play if you have to file a claim. It’s secondary coverage and commonly used to cover liability if you borrow, rent or share a vehicle and the car owner’s primary coverage isn’t adequate.

You can get non-owners car insurance for less than $500 a year. That’s even less than the cost of most yearly cell phone bills.

Learn how a non-owner insurance policy works and how much it costs in each state.

What is non-owners car insurance?

Non-owner car insurance can be used by high-risk drivers who are required to buy a liability insurance policy to keep their driver’s license. But it is also used by drivers who don’t own cars and rent frequently or are trying to maintain continuous coverage.

A non-owner insurance policy will generally cost much less than an owner’s policy. The average cost of a non-owners car insurance policy is $380 per year. The low rate is because a car insurance company insuring a non-owner driver’s risk is lower than that of a car owner who drives daily.

The premium amount is, however, dependent upon typical rating factors, such as your driving record and where you live.

How does non-owners auto insurance work?

Non-owner car insurance typically provides liability coverage, which can help protect the driver in the event of an accident. You can also purchase medical payments protection, personal injury protection and underinsured/uninsured motorist protection as additional coverages.

Although it is optional insurance coverage, it can be helpful for those who drive occasionally or do not have regular access to a vehicle. Non-owners car insurance acts as secondary coverage and kicks in if the vehicle owner’s primary coverage isn’t enough to pay for the damages.

If you have an accident while driving someone else’s car and cause damage worth $30,000 and the car owner’s primary coverage pays for $15,000 of the damage up to the policy’s coverage limits, you would be responsible for for the rest.

Can you get non-owners car insurance without a car?

Yes. Guidelines vary, but typically an insurer will require that you:

• Have a valid driver’s license.
• Do not own a vehicle.
• Some insurers also require that no one in your household owns a vehicle and that you do not have regular access to a car.

Why would you want a non-owner insurance policy?

Here are four instances when you may want a non-owner insurance policy:

1. As a car renter, the policy serves as primary liability coverage. However, you would still need to buy the collision damage waiver to pay for repairs to the rental car if your credit card company does not automatically do so.
2. As someone trying to maintain continuous coverage, you are avoiding a gap in your insurance history that label you as a high-risk driver and result in higher rates when you buy your next car insurance policy.
3. As a high-risk driver, the policy is typically needed to satisfy conditions to receive or reinstate a driver’s license. If you are required to file an SR-22 or FR-44 with the state – an insurance company’s guarantee that your coverage is current – a non-owner SR-22 insurance policy can satisfy that mandate even if you don’t own a car.
4. You may own a car, but want to buy non-owner insurance to fulfill state obligations for SR-22 or FR-44 filings.

For Example

If you have a car and you’re satisfied with your current insurer, but you need to file an SR-22 or FR-44 and your current company does not offer it, you can purchase a separate non-owner policy with another carrier to meet your filing requirements. The extra cost is typically very low because the supplemental non-owner policy isn’t covering your car.

Who should not buy non-owners car insurance?

A non-owner personal auto insurance policy isn’t for you if:

• You own a car. In this case, purchase a standard owner’s policy.
• There is a vehicle in your household. Typically, in this situation, you would be required to be placed on the car owner’s policy as a driver to be covered instead of obtaining a non-owner policy of your own. This is especially true if your spouse owns a vehicle since an insurer may also consider that vehicle your property to insure.
• You drive a car regularly. If you don’t own a car but drive someone else’s vehicle frequently, you should be added to that person’s policy as a driver. If you’re in full possession of the vehicle, find an insurer that will allow you to place a standard auto insurance policy on that vehicle.
• You are using a vehicle for business use.
• You don’t have a driver’s license and cannot obtain one within 30 days of starting a non-owner policy.

What does a non-owners car insurance policy cover?

Coverage under a non-owner insurance policy includes:

• Bodily injury liability
• Property damage liability

Some insurers also offer medical payments coverage and uninsured/underinsured motorist bodily injury coverage.

Because a car is not attached to a non-owner policy, you will not be offered the following types of coverage:

• Collision
• Comprehensive
• Rental reimbursement
• Towing and labor
• Custom parts and equipment coverage

A non-owner car insurance policy will not pay for repairs to a car you borrow. If you borrow a friend’s car, you need to verify that the owner has a policy that will extend to you as primary coverage.

Your non-owners insurance coverage would pay only if the owner’s coverage limits are reached and then only to cover the damages inflicted on the person or vehicle you hit.

Does non-owners car insurance prevent a lapse in coverage?

Non-owner insurance can help you avoid a lapse in coverage when you frequently drive but don’t yet own a car. A lapse in coverage for a week up to 30 days will hike your car insurance rate by an average of 14%, or about $269 a year. More than 30 days lapse gets you a 22% increase, about $439 more a year.

How much does non-owner car insurance cost?

Non-owner car insurance costs $380 a year, on average, based on a CarInsurance.com rate analysis. However, depending on where you live and other factors, you may pay twice that, or half.

Expert’s Tip

Non-owner car insurance is cheaper than normal insurance, but the costs vary from company to company. Costs tend to range from 10% to 80% of the price you’d pay for a standard auto policy, says Jarrett Dunbar, a spokesman for Nationwide.

Dunbar says that “much depends on how often the customer has access to a car, how that car will be used and what age the operator is.”

Non-owner car insurance costs in your state

There can be significant cost differences by state and ZIP code. Here’s a look at the average costs for non-owner car insurance by state:

How much is non-owner car insurance in California?

The average non-owner car insurance cost in California is $323. However, depending on your location, you may pay closer to $300 or nearly $600. Here’s how the costs compare between cities in California:

Who has the cheapest non-owner car insurance?

Among the major carriers surveyed, Auto-Owners offers the cheapest non-owner car insurance, on average. See how major carriers compare for non-owner insurance rates.

How do I buy a non-owner car insurance policy?

You apply a non-owner car insurance policy in the same manner as you would for an owner’s policy. Not all auto insurance providers offer non-owner policies because this is considered a non-standard policy.

You can contact local independent agents with access to multiple non-standard carriers or your state’s insurance regulator for consumer information on companies offering non-owner policies.

Suppose you have a non-owner insurance policy and you purchase a vehicle. In that case, you will need to let your insurer know immediately to change your policy to an owner’s policy that will cover your new car – or else you’ll be without coverage on the vehicle.

Compare Car Insurance Quotes from 25+ Companies With Rate Calculator

Frequently asked questions: Non-owner car insurance

Methodology:

CarInsurance.com gathered rates for non-owner car insurance across all the states with the help of Quadrant Information Services. Non-owner insurance rates are based on the profile of a 40-year-old male driver with a good credit score and a clean driving record.

Shivani Gite

Contributing Researcher

Shivani Gite is a personal finance and insurance writer with a degree in journalism and mass communication. She is passionate about making insurance topics easy-to-understand for people and helping them make better financial decisions. When not writing, you can find her reading a book or watching anime.