Many of us lend our cars to friends, family members, or neighbors for errands or emergencies. While it’s a kind gesture, it can also be a source of worry. What happens if the borrower gets into an accident while driving the car? Who is responsible? Whose insurance pays?

While the answer depends on the specific circumstances of your case, understanding how car insurance typically works in these situations can help you know what to expect. Read on to learn whose insurance pays if you are in an accident while borrowing someone’s car and how a New Orleans car accident lawyer from Dudley DeBosier can help.

Owner’s Policy: Who’s Covered and Who’s Not?

In Louisiana, auto insurance typically follows the car, not the driver. This means the car owner’s insurance is usually the primary coverage in an accident, regardless of who was driving. However, the specifics can vary depending on the policy:

  • Permissive Use Policies: Many insurance policies in Louisiana cover “permissive use,” which means anyone driving the car with the owner’s permission is covered. This includes family members, friends, and even acquaintances, as long as they are licensed drivers.
  • Named Driver Policies: Some policies only cover drivers specifically listed on the policy. In this case, if an unlisted person borrows the car and gets into an accident, they may not be covered.
  • Excluded Drivers: Some policies specifically exclude certain drivers, often due to their poor driving records. The insurance company may deny coverage if a driver who was specifically excluded from the policy uses the car and causes an accident.

Does the Borrower’s Insurance Kick In?

Usually, the car owner’s insurance is the primary coverage and deals with any initial claims after an accident. When a borrower has their own insurance, it provides secondary coverage. This means if costs from an accident exceed what the owner’s policy covers, or if there are gaps in coverage, the borrower’s insurance might handle the extra expenses.

For example, imagine you borrow a friend’s car and get into an accident, causing $5,000 in damages. If your friend’s insurance policy covers only $3,000 of those damages, but since your insurance includes coverage for driving other vehicles, your policy could cover the remaining $2,000.

Are You Listed on the Owner’s Policy? Here’s Why It Matters

Being listed on the car owner’s insurance policy can impact the coverage available in the event of an accident. If you are named on the policy, you are generally covered in the same manner as the car owner.

As a covered driver, the insurance will pay for damages and injuries up to the policy’s limits. Coverage may still apply under permissive use if you are not listed on the policy but are driving with the owner’s permission. However, this coverage might come with limitations or higher deductibles.

Some insurance companies impose restrictions on permissive use, potentially reducing the coverage or increasing the owner’s out-of-pocket expenses.

Accident Scenarios: Who Pays When It’s Not Your Fault?

Even if you practice safe driving when borrowing a car, there’s a chance another person may cause a crash. If a negligent driver is liable for the collision, it can impact who’s insurance pays for damages.

  • At-Fault Driver’s Insurance: If the other driver was 100% at fault, their liability insurance should cover damages and injuries, regardless of who was driving the borrowed car.
  • Uninsured/Underinsured Motorist Coverage: If the at-fault driver is uninsured or underinsured, the car owner’s policy may cover damages through uninsured/underinsured motorist coverage. However, limitations may apply, especially if the owner’s policy doesn’t cover non-listed drivers.
  • Comparative Fault: Louisiana follows a pure comparative fault system. If the borrower is partially at fault, compensation may be reduced by their percentage of fault.

Every insurance policy varies, so carefully read and understand any limitations, restrictions, or coverage details before sharing or borrowing a car. After an accident, consult a car accident attorney to help review your insurance policy. They can ensure you fully understand your coverage and assist with filing any claims for compensation.

Protect Your Rights After an Accident in a Borrowed Car

Insurance claims after a crash in a borrowed car can be challenging. Our New Orleans car accident lawyers at Dudley DeBosier can review relevant policies and help you seek financial support through your insurance, the car owner’s, or a liable third party.

Our legal team has decades of experience with all insurance claim situations and can offer qualified representation. Contact us today for a free case review.

Disclaimer: This content has been reviewed by Chad Lederman, Director of Legal Operations at our New Orleans office.