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A friend borrowed my car and got into an accident

My vehicle is insured. I loaned it to someone who had an accident he caused, both vehicles are damaged. How will this effect my insurance? The person i loaned the vehicle to is a licensed driver, but does not own a vehicle so he does not have his own insurance policy.

Agent Answer

Ava Lynch

Because Michigan is a no-fault state, the damage caused by the other driver will be paid by the other driver. However, the damage to your own vehicle will also be covered by your policy, as insurance follows the vehicle, not the driver. So, in this scenario, any damage to the other vehicle and your vehicle would be covered by your insurance. It’s very likely your insurance rate will increase, regardless if you were driving. However, because you weren’t the driver in the accident (which you can prove through your CLUE report, you might be able to get the increased premium damages mitigated. Best of luck.

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