If I mostly use Lyft or Uber, do I still need car insurance?
My 2001 Jetta is practically unusable at this point unless I spend another $400 to fix it, and who knows what will break down next on this old car, so I'm considering just doing without a personal vehicle. As I live in an urban core right next to Manhattan I should be able to use Lyft/Uber for 95% of my ride needs, but I will still likely want to rent a car here and there for longer trips, or borrow one from my friends. I know that my credit card gives me a certain level of additional coverage on rentals, but will this do? Would I still need car insurance, and if so, what are the most cost-effective options? I currently have GEICO, an excellent driving record, and my total insurance expense for 2016 was $1350. Thanks for your input! Note: I travel frequently overseas and often rent cars while I am abroad. I am 37yo (turn 38 in March 2018).
Renting and borrowing a vehicle sound similar, but the way the insurance coverage works for both situations is different. Let's take a look:
Renting - If you have an auto policy that includes comprehensive and collision coverage, that policy will normally extend to cover a rental vehicle as well. It's always a good idea to confirm that with your specific provider. Most credit cards also offer coverage for rental cars, however there are some things of which you should be aware. If you don't have auto insurance, the coverage offered by your credit card becomes primary if something happens to your rental. However, credit cards do not offer liability or state required coverage. State minimum coverage can be purchased through the rental agency, or you can purchase a Non-Owners policy for higher limits of coverage. If you are renting a vehicle out of the country, a Non-Owners policy would not provide any coverage so you would have to rely on your credit card company or purchase coverage at the rental counter.
Borrowing - Auto insurance follows the vehicle rather than the driver. So if you are borrowing a vehicle then you should be covered to drive as long as that vehicle is insured. In the event that the policy on the vehicle you are borrowing has lapsed or cancelled then you would be without coverage. A Non-Owners insurance policy would provide liability coverage if you happen to be driving a vehicle that is not currently insured. Even if the car you're borrowing is insured, a Non-Owners policy would provide additional liability coverage in the event that you exceed the liability limit on the vehicle's policy.
A Non-Owners insurance policy is generally inexpensive and can help to better protect yourself in the event that you are involved in a crash. Although most companies do not offer quotes for Non-Owners insurance online, you should be able to find coverage at a local agency in your area.