The Basics of Non-Owners Insurance

If you own a car, you need car insurance. If you own a home, homeowners insurance is a must. But what if you rent or borrow your car or house instead of purchasing them? Do you still need to buy insurance coverage if the home you live in or the automobile you drive doesn't belong to you?

Absolutely! Ownership is only one prerequisite for purchasing insurance. In fact, insuring cars or homes you lease or borrow is the only tried-and-true way to make sure you, your possessions and everyone around you stays safe and protected while you're on the road or at home—no matter where you live or drive.

Non-Owner Car Insurance

Non-owner car insurance is not a specific type of insurance, but rather refers to all the possible policies for individuals who rent automobiles or drive the cars of family and friends.

With the rising cost of fuel, automobiles and insurance these days, many people are foregoing vehicle ownership completely and taking public transportation to work or school or participating in carpools.

When they really need a car, they simply borrow one from a friend or family member or rent one from a local rental agency.

That's where non-owner car insurance comes in. For those who only drive occasionally and don't own a car, non-owner car coverage provides insurance in the driver's name and protects against:

  • Liability (financial responsibility when you hurt someone else)
  • Uninsured/underinsured motorist protection
  • Personal Injury Protection (PIP)
  • Medical payments coverage

Considered very basic insurance, it does not cover:

  • Comprehensive or collision damage
  • Towing reimbursement
  • Rental reimbursement

Though equivalent coverage can be purchased at a rental car counter, buying a non-owner car insurance policy is usually more cost-effective if you rent a car more than a few days a year.

What does it cost? About $300 to $500 per year, depending on where you live, your driving record and other underwriting guidelines set by auto insurance companies.

One important note: This type of coverage kicks in only when all other car insurance policies are tapped out. So if you borrow your neighbor's car and end up in an accident, his insurer covers the damage that results up to that policy's limits—and your non-owner insurance policy picks up from there.

For more information on rental car insurance, see our article titled, "Rental Car Insurance—Do You Really Need It?"

Non-Owner Home Insurance

Non-owner home insurance is not a specific type of insurance either. It refers to the types of insurance available to people who rent an apartment, condo, townhouse or home.

If you'd rather avoid the hassle and headache of purchasing a home—or you'd like to delay it until some future point—renters' insurance can provide the basic coverage you need to protect your assets in your rental.

Whether you lease a house, condo, townhouse or apartment, having renters' insurance means you never have to worry about keeping your possessions safe, dry and intact. Why? Because it protects everything inside your home from disaster…and that includes you and your visitors.


 

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