Can a Driver Get Insurance If They Do Not Own a Car?
The U.S. Department of Transportation Federal Highway Administration reports that there are more registered vehicles on the road than licensed drivers. Still, many of the nearly 200 million licensed drivers in the U.S. do not own a vehicle. While not every state requires drivers to maintain auto insurance, every state requires drivers to maintain financial responsibility for their actions while operating a vehicle. As a result, all drivers, even those who do not own their vehicles, are required to carry auto insurance, or another form of financial responsibility.
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Requirements
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Drivers are required to meet the financial responsibility requirements of their resident state. Each state has its own minimum requirements. While most drivers choose to meet their requirement by obtaining auto insurance, most states provide drivers with an option of securing other forms of financial responsibility. Drivers may elect to deposit a certificate of deposit or surety bond with the department of motor vehicles. These are options for licensed drivers that do not own a vehicle. If you choose to purchase auto insurance like most others, however, you must purchase a non-owner insurance policy.
Policy
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The non-owner insurance policy is a liability policy that does not insure a vehicle. This policy provides its policyholders with the state's minimum liability insurance requirements, providing coverages such as bodily injury and property damage, personal injury protection, and uninsured and underinsured motorist coverages. Non-owner policies do not provide options for increased coverages limits and do not include options for physical damage coverages, such as comprehensive and collision.
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Physical Damage Coverages
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Since the non-owner policy does not insure against the damages caused the driver's vehicle, non-owner drivers should take steps to ensure that the vehicle they are driving is insured against potential damages. Before borrowing a vehicle, non-owner drivers should inquire if the vehicle is insured with comprehensive and collision, or physical damage, coverages. When renting a vehicle, drivers may consider adding the physical damage coverage options to their rental contracts. These coverages will ensure that the vehicle is protected from damages the non-owner driver causes when hitting another object or vehicle, as well as from damages caused by nature, animals, fire and theft.
Considerations
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Non-owner insurance policies are often more expensive than standard policies with vehicles. This is because the non-owner insurance policy comes with a higher risk for the insurance carrier. One day, the non-owner driver may drive a mid-sized sedan while the next day the driver may operate a luxury vehicle. Also, the non-owner insurance policy is not offered by every auto insurance carrier. Auto carriers that handle high-risk and non-standard auto policies often offer the non-owner policy option.
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