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I Don't Own a Car — Do I Still Need Insurance?

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Maria Neira
April 16, 2020

If you don’t own a car, you don’t need car insurance, right? Wrong. 

Yes, you read that right. For people who don’t own a car but still sometimes drive one, a non-owner car insurance policy will keep you protected in an accident.

Get a non-owner car insurance quote

What does non-owner car insurance cover?

A non-owner car insurance policy provides only liability coverage. That means, bodily injury or property damage caused in the event of an at-fault accident is covered up to the limits on the policy.

It’s important to note that this type of insurance covers only a single driver. If there are multiple drivers that need coverage, each person will need to have their own policy. The cost of non-owner car insurance depends on factors such as your driving record, where you live and how much liability coverage you need.

What non-owner car insurance doesn’t cover is any damage done to the vehicle you are driving at the time. 

Note, even if the car you’re driving is owned by a family member or someone in your household, it may not cover you if the car gets damaged in an accident. For the car to be covered in that case, you would need to be listed on their policy

4 people who should have non-owner car insurance

Having car insurance when you don’t own a car makes sense for three types of people. 

  1. You sometimes borrow a friend’s or family member’s car.
  2. You are required to have an SR-22.
  3. You drive rental cars often.
  4. You just sold your car and are between cars.

You sometimes borrow a friend's or family member's car

If you don’t own a car but sometimes borrow a friend’s or family member's car, then you need to have car insurance. Non-owner car insurance will financially protect you in the event of a car accident. 

Don’t rely on the owner of the car to have enough insurance to cover you. If you are in a serious at-fault accident while driving someone else’s car, you will be responsible for any costs that exceed their liability limits. This could put your finances in jeopardy. If you have your own policy, you can be confident you are fully protected.

You are required to have an SR-22

Another situation where non-owner car insurance makes sense is if you don’t have a very good driving record. For instance, if you have been cited for driving without insurance or driving under the influence, you may be required to get an SR-22. 

An SR-22 is a document for "high-risk" drivers proving they have insurance coverage, and it can be on file for up to three years. If you don’t own a car but are in this situation, a non-owner car insurance policy is the solution.

You drive rental cars often

Having car insurance is also a smart decision if you often drive a rental car. Whether you rent a car for frequent work trips or travels, it’s good to have insurance.

You just sold your car and are between cars

If you just sold your car but aren’t ready to buy another one just yet, you should have insurance so you don't have a lapse in coverage. A lapse in coverage can result in a huge spike in your auto insurance premium. 

READ MORE >> Turo Review: Is it better than a car rental?

How much does it cost?

Shopping around when buying auto insurance could result in a huge savings. Premiums for non-owner car insurance policies can vary from carrier to carrier. In general, though, the premium is about 5% to 15% less expensive than a regular auto insurance policy with similar coverage.

Where to buy non-owner car insurance

Many national insurance companies offer this type of policy. Among these are GEICO, Nationwide, State Farm, The General, Progressive and Dairyland. When shopping for insurance, be sure to specify you need non-owner car insurance.