what is auto insurance for non-owners?
Non-owner auto insurance is coverage for drivers who do not own a car, but who drive frequently using rental cars, car-sharing services, or loaner vehicles. Drivers are eligible for non-owner insurance if they have a valid driver’s license and do not own a vehicle. Many insurers will not write a non-owner policy if a driver has access to a vehicle in their home.
key things to know about car insurance for non-owners
- Non-owners policies provide the minimum coverage required by the state, as well as some optional add-ons.
- Most major insurers offer auto insurance for non-owners.
- Non-owner car insurance costs between $200 and $500 per year.
- Consider getting non-owner car insurance if you don’t own a car but plan to rent or borrow it frequently.
How does auto insurance work for non-owners?
Non-owner auto insurance provides liability coverage for people who don’t own a car. Like standard liability insurance, it covers car damage and injuries to others when you’re at fault, but it won’t cover your own injuries or damage to the vehicle you’re driving.
Reading: How to get non owners auto insurance
Non-owners insurance policies include any type of state-mandated coverage and typically allow drivers to add optional types of coverage, such as personal injury and uninsured/underinsured motorist protection ( pip). Since non-owners insurance policies do not cover a specific vehicle, they do not include collision or comprehensive coverage.
what does auto insurance cover for non-owners?
Non-owner auto insurance generally provides the same level of protection as a standard auto insurance policy. A non-homeowner’s insurance policy will cover you for:
- injuries to other drivers in accidents caused by you
- property damage, excluding damage to the vehicle you are driving
- accidents caused by drivers without uninsured or underinsured
- medical bills resulting from accidents
learn more about what auto insurance covers for non-owners.
best non-owner car insurance companies
*usaa is only available to military service members and their families
Most national insurance companies offer auto insurance policies for non-owners. however, they typically only provide quotes over the phone, and progressive only offers non-owner auto insurance to existing customers.
other companies that offer car insurance for non-owners
- state farm
- liberty mutual
- american family
- acceptance insurance
- dairy country
- auto direct
- the general
how much does auto insurance cost for non-owners?
Non-owner auto insurance costs between $200 and $500 a year. Since drivers without homeowners insurance don’t travel as much as the average insured, they are less likely to file a claim and, as a result, pay less for coverage.
The amount of coverage you choose, your driving history, your location, and how often you drive will help determine the exact cost of your policy. non-owner’s insurance policies do not have a deductible.
Learn more about how much third-party auto insurance costs.
when to consider third party auto insurance
1. you are looking to get your license back after a serious infraction.
If your license is suspended after being convicted of driving under the influence of alcohol or another serious traffic violation, state law will require you to present an SR-22 or FR-44 to reinstate your license. As part of this process, you will need to certify that you have purchased auto insurance. If you don’t own a car, purchasing a non-owners insurance policy will meet state requirements.
2. you rent cars frequently.
Most states require car rental companies to provide the state minimum levels of liability insurance as part of the base rental rate. But in many cases those state minimums cover very little, and some states like California don’t require rental companies to provide liability protection.
You can purchase additional liability insurance at the rental counter, but this coverage will cost you between $10 and $16 per day. So if you rent cars several times a year and want more than the minimum level of liability coverage, your own non-owners policy may be the most affordable option.
paying with a credit card gives you coverage for damage to the rental car, but bank cards do not provide liability insurance protection.
3. frequently uses car sharing services.
Car sharing companies include some level of liability coverage as part of the rental fee. Zipcar, for example, provides members who joined after July 2018 with the minimum amount of coverage required by their state. but you are responsible for a $1,000 “damage fee” before this coverage takes effect.
Car sharing services typically offer additional coverage or reduced deductibles for an additional annual fee; Zipcar’s “damage fee waiver” is $79 a year, for example. however, with a non-owner’s insurance policy, you’re automatically covered when you drive any vehicle, including those rented through car-sharing services.
4. you are borrowing a car from a friend or family member.
When you drive someone else’s car, the costs of an accident will usually be covered by the owner’s insurance policy. but then the car owner chooses the level of coverage, not you. and if there are problems with the claims, you are not a customer of the insurance company. under your own policy, you can be sure you have adequate liability coverage.
5. you are temporarily between cars.
If you don’t have a car anytime soon but plan to buy a car soon, a non-owners insurance policy is an affordable way to maintain ongoing coverage and long-term customer status. It will also provide you with coverage while you test drive vehicles. When you buy a car, you’ll need to tell your insurer right away and switch to an owner’s policy.
when not to use non-owner’s insurance
Non-owner auto insurance is not suitable for people who:
- live with someone who owns a car, as most companies won’t let you buy a non-owners policy in this situation.
- use public transportation or services rideshare instead of driving.
- only drive when using rental cars a few times a year, in which case rental car insurance would be a better plan.
- no plan to own a car.
ask the experts
To learn more about third-party auto insurance, Wallethub posed the following questions to a panel of experts. Click on the experts below to see their biographies and responses.
1. What Kind of Drivers Should Consider Non-Owner Auto Insurance? 2. What types of drivers should not consider non-owner auto insurance? 3. What is the biggest advantage of a non-owners auto insurance policy?