In Plain English
Posted on: Mar 22, 2016
Whether you need an SR22 to get your license back or you're just an occasional driver that doesn't own a car, you should know your options when it comes to non-owners coverage. We're here to break it down in black and white.
What exactly is Non-Owners Insurance?
The answer would seem pretty straight forward based on the name of the coverage, but it still causes confusion for a lot of people so if you're less than sure, you are in the majority. A non-owner policy provides coverage for people who do not own a vehicle but still need to be covered as a driver when they get behind the wheel. This type of policy will provide a driver with essentially the same coverage options as a traditional auto policy with the exception of physical damage (full) coverage. Since the insurance company has no clue what vehicle an insured might be driving (one day it could be a very expensive vehicle and the next day you could be driving a clunker) there is no way for them to properly rate the price of the coverage and therefore wont offer it.
So while comprehensive and collision coverage aren't available, this does allow drivers to carry liability, medical, and uninsured motorist coverage to protect themselves while driving (and also stay legal on the road!). In the event that you are involved in an accident, this policy will cover the injury that you caused to the other driver and damage to the other vehicle up to the limits on your policy as well as any additional options you decide to tack on. This isn't an exhaustive list, but a typical non-owner policy will offer:
- Liability (Coverage for other driver)
- Uninsured/Underinsured Motorist (Coverage for you and your passengers)
- Medical/PIP (Coverage for you and your passengers)
I need an SR22 and don't own a car, how does that work?
A non-owner policy will look very similar to a standard auto policy because your insurance is still reported to the state and this can be quite helpful if you find yourself in that sticky situation of needing an SR22 and not having a car. Chances are, if you're needing an SR22 then you're probably aware of all the fees and money involved in getting your license back. You don't have to add buying a vehicle on top of all that just to get insurance to have your document filed with the state.
Since a non-owner policy provides you with the same legally required insurance coverage as any other driver on the road, an SR22 can be added to this type of policy just like a standard auto policy. And you will be happy to hear that the cost of most non-owner policies are normally much less than a standard auto policy. This brings up another interesting point as well...
My carrier doesn't offer an SR22 but I've been with them for 10 years and don't want to switch. What can I do?
Insurance is all about risk, right? Well if you need an SR22 then there is a good chance that your license has been in some sort of valid/suspended limbo over a driving infraction and most carriers don't like that. You could be faced with a situation where you've been with a company for years, you made a minor (or major) mistake that lead to you needing an SR22, and your carrier doesn't offer one. What's a loyal customer to do?
If your company won't issue an SR22 to the state but you want to keep your vehicles insured through them anyway (and assuming they won't drop your coverage because of the violation or suspension), you could always purchase a non-owners policy and request an SR22. This would mean having to pay for a second policy, however, the premiums for non-owners policies are normally much less than traditional auto coverage and could be a more affordable alternative than switching all of your coverage to a different carrier. Not to mention the most important part: you will be compliant with your state's requirement and avoid additional fees and suspensions.
What if I'm selling my car and won't need insurance until I buy a new one?
This would be a good time to consider a non-owner policy. Consider that even after you sell your car more than likely you'll still have to operate a vehicle to commute to work, grocery shop, or test drive a car. Because you won't be listed as a driver on the insurance policy that covers the vehicle you are borrowing you could be ticketed for not being insured. That ticket could end up causing your license to be suspended and costing you more money.
Speaking of spending money, don't you want to pay as little as possible for the insurance on your next vehicle? If you cancel your insurance on a vehicle you just sold rather than get a non-owners policy to cover yourself in the time between cars you will have had a lapse in coverage and any lapse, even if it's just one day, will cause your rates to become more expensive. If you go more than thirty days without auto insurance then you lose your entire continuous coverage discount and will pay even higher rates.
How many people can be covered on a Non-Owners Insurance policy?
A non-owner policy will provide coverage for the named insured (primary person on policy) only and no other drivers can be added to the coverage. One person and one person only.
Does a Non-Owners policy cover the vehicle that I am driving?
A non-owner policy covers your liability while you are driving a vehicle. It will pay for injury that you cause to people in another vehicle as well as damage to that other vehicle up to the limits of your coverage. This does not cover any damage to the vehicle that you may be driving and that damage will need to be claimed under the insurance of the owner of the vehicle assuming that they have comprehensive and collision coverage.
I don't drive any vehicles at all and I just need an SR22, why do I have to buy insurance?
An SR22 is a document or piece of paper that is filed with the state to prove that you have valid insurance. So the insurance part is a requirement for the SR22 to be filed to reinstate your license or keep it from being suspended.
Where can I get a Non-Owners Insurance policy?
This can be quite confusing because most companies don't advertise that they offer this type of policy. We've done some searching for you and while this list is not exhaustive, it should point you in the right direction.
Companies that do offer Non-Owners Insurance:
- The General
- State Farm
Companies that do not offer Non-Owners Insurance:
- Liberty Mutual
***Disclaimer*** Non-Owners Insurance availability will vary by state and situation. Some direct carriers do not offer non-owner coverage over the phone and require that you set up a policy through a local agent or broker. If you are in the market for this type of coverage, call the company directly to inquire.