Ask an Agent
Have a question? We're here to help.
Ask an agent for free
Question

Can lienholder be responsible in car accident?

I own a car and have it in my name. I am selling it to a friend with a loan with monthly payments and a contract. The friend has comprehensive and collision and state minimum liability. I am a little worried about the liability. If he is in an at-fault accident and exceeds his limit, do I the owner of the car become responsible? Can they sue me?

Jan 12, 2019 Cincinnati, OH

Answer
Author profile picture

Ava Lynch

Insurance Analyst

Credentials
  • 7+ years of Experience in the Insurance Industry

Ava joined The Zebra as a writer and licensed insurance agent in 2016. She now works as a senior insurance contributor, providing insights and data a…

If you keep the car registered in your name, there is a possibility that you could be held liable for damages that exceed the driver's policy. It is not common, however, there is still a chance. If you do let your friend take over the payments, make sure you are listed as an additional interest on the policy. This means you have a financial stake in the vehicle. Also, check with your finance company. They may require you to be listed as a driver on the policy that covers the car. Good luck and if you have any questions, don't hesitate to ask.

Ask an Agent
Have a question? We're here to help.
Ask an agent for free

Insurance is complicated, but it doesn't have to be.

The Zebra searches all of the top insurance companies, in one place, so you can compare the cost and coverage you need to protect your car, home and other property.

Step 1: Tell us a little about yourself

Choose an insurance product and enter your zip code to get started.

Step 2: Sip your coffee while we find the best quotes

Enter the necessary information and then sit back while we find quotes from 100 top insurance carriers.

Icon Fill Form

Step 3: Compare your quotes

Compare quotes side-by-side to find the right match for you, whether it's home, auto, or more.

Icon Agent

Step 4: Let our agents do the hard work for you

Once you pick your policy, our agents are here to get you over the finish line. Then just relax and enjoy your savings.

Compare insurance rates today!

Location pin icon
No junk mail. No spam calls. Free quotes.

Related Questions

Other people are also asking...

Can my father insure my car if I'm financing it?

In most cases, you can insure your car on your father's policy but you will have to be listed as a driver on the policy.  If you will not be driving the car you will need to listed as an additional interest on the policy for your vehicle. The person driving the car will need to be listed as a …
Oct 4, 2018 Cornelius, OR

Does renters insurance cover hotel stay if my air conditioning system goes out?

Typically, your renter's policy will not cover your hotel due to your air conditioner being out. A broken AC is not considered the loss of use of the dwelling (home) — they typically only pay for other accommodations when the entire dwelling is uninhabitable. I recommend you check out our guid…
Jul 29, 2019 Cincinnati, OH

What should I do with my car insurance after I pay off my car loan?

3. It depends on the value of your vehicle. The answer to your third question is subjective and up to each individual to decide what suits their needs best. That being said, you should try to get a fairly accurate idea of your vehicle's actual cash value (ACV) since that is what GEICO would pa…
Jul 11, 2018 Slidell, LA

Is it necessary to get umbrella insurance with uninsured / uninsured coverage?

Umbrella insurance provides additional liability coverage above and beyond what you have on your auto and homeowners policies. This protects your assets if you are sued for injury or damage that you may have caused to another party for which you are liable. Umbrella insurance generally does not pro…
Aug 2, 2017 Columbus, OH