Home Vehicle Insurance What exactly is non-owner vehicle insurance, and when do you require it?

What exactly is non-owner vehicle insurance, and when do you require it?


If you often rent automobiles, non-owner auto insurance coverage might save you money.

Non-owner automobile insurance might save you money if you don’t own a car but often borrow or rent one.


A non-owner automobile insurance coverage may be less expensive than paying for liability insurance via a car rental business. When you’re ready to buy your first automobile, this form of coverage may qualify you for a continuous coverage discount on a basic auto insurance policy.

If you’re thinking about getting non-owner auto insurance, CNBC Select explains how it works and why it’s a good idea.


What exactly is non-owner car insurance, and how does it work?

Non-owner automobile insurance is insurance for licensed drivers who do not own a car. It usually just covers the policyholder’s obligation. So, while non-owners insurance will not protect the car you’re driving, it will compensate you for any damages or injuries you cause to others.


This sort of insurance may only provide coverage to the policyholder. If this is the case, your spouse or partner will require their insurance coverage. This coverage is also commonly characterized as supplementary, which indicates that it covers expenditures that are not covered by the vehicle owner’s primary auto insurance. Furthermore, there is no deductible to fulfill before the coverage kicks in with non-owner auto insurance.

You should search around for the greatest rate, just like you would for any other type of insurance. Non-owner insurance isn’t available in every state where a carrier operates, but many of the big names do, including Geico, Nationwide, and The General. Nationwide is accessible in 46 states plus Washington, D.C., making it an excellent starting point for policy comparisons.
What does non-owner automobile insurance cover?

Non-owner auto insurance covers you if you cause injuries or damage while driving a borrowed or rented vehicle. It pays for the following expenses:

Property restoration or replacement

Medical bills for injuries caused by you

If you are sued as a result of a covered accident, you will be reimbursed for your legal expenses.

A non-owners vehicle policy may provide additional coverage depending on your current coverage and where you reside. Some plans cover your medical fees and may also include underinsured motorist coverage (which pays for when another driver is at fault but lacks sufficient liability coverage to cover all of the costs).

What does non-owner automobile insurance not cover?

Non-owner vehicle insurance often offers only liability coverage, which means it does not include:

Damage to your car: This may be covered by the vehicle owner’s insurance or the insurance of another motorist if they are at fault.

Personal property: Any damage or theft to your items in a car you’re driving is not covered, but if you have renters or homeowners insurance, that coverage may apply.

Business activity: A personal non-owners vehicle insurance policy does not cover business-related driving, but non-owners automobile insurance is available for companies.

When is non-owner vehicle insurance appropriate?

If you do not own a car, you do not automatically require non-owner automobile insurance. However, there are times when it can save you money.

If you intend to buy a car soon or are in the market for a new vehicle, a non-owners auto policy may help you qualify for a continuous coverage discount. Many vehicle insurance companies provide discounts if you have had coverage for a specific period, usually six months or more. However, you should do the math to determine if the reduction is significant enough to warrant paying for non-owners auto insurance.

This sort of coverage may be beneficial to someone who often hires cars or utilizes car-sharing services such as Zipcar or Turo. Having a non-owners automobile insurance policy helps you to avoid paying for the liability coverage provided by the rental business, which may easily cost $10-$15 per day on top of all other rental expenses. But, once again, do the arithmetic to ensure that the savings outweigh the costs.


Can you acquire insurance if you don’t have a car?

Most vehicle insurance companies will sell you non-owner automobile insurance coverage. This form of insurance normally just covers liability.

Who should obtain non-owner automobile insurance?

If you often rent or borrow automobiles and do not own a car, non-owner car insurance coverage makes sense. You’ll only want to make sure the rates are lower than what you’d pay for liability insurance from a rental business.

Is non-owner automobile insurance valid for car rentals?

A non-owner auto insurance policy does not cover a rented automobile for comprehensive or collision damage. However, it provides liability coverage when driving a rented vehicle and covers damages or injuries caused to others while driving.