Friends always like it when a friend has a set of wheels. That way, they can borrow the keys when they need to get somewhere. In fact, it is a fairly common practice to use another person’s car. Unfortunately, most drivers are unaware of the liability involved in letting a friend borrow your car. Most drivers think that the car insurance policy they purchased belongs to the driver, following them along regardless of the car they are driving. This is not the case. Car insurance policies follow the car and the drivers that are listed on the insurance policy with that car. When an accident occurs with that borrowed vehicle, the owner’s car insurance policy provides primary coverage.
Risks of loaning your car
It is not uncommon to toss your car keys to a friend or neighbor without hesitation. But you should think about it first. Because you are liable if they are involved in a car accident. Your automobile insurance policy insures you and your vehicle, and any family members and others that are using your car with your permission. So if you give your friend permission to drive your car and they have a car accident with your vehicle, your insurance policy will be the policy covering any damages, even if they have better car insurance than you do. If you have not yet met the deductible on your car insurance policy, you may need to meet that first, and – depending upon your individual policy and the circumstances surrounding the accident – your insurance company may raise your car insurance premium.
“No fault” car insurance
New Jersey follows a “no-fault” system regarding car insurance. Under the “no-fault” system, all vehicles registered in New Jersey are required to have Personal Injury Protection (PIP) insurance. The PIP insurance reimburses medical expenses stemming from a car accident for you and anyone else covered under your insurance policy, regardless of who was responsible for the accident. The PIP insurance follows the insured individuals, which is different from liability insurance which follows the vehicle. In situations where the person driving your car does not have a car insurance policy, and does not reside with another person who has PIP insurance, you will be held accountable for the damages.
Car accident with a borrowed car? We can help
You thought you were being a good friend, loaning your car out to someone in need. But then that friend had a car accident while driving your car, and now you are stuck filing insurance claims and your friend wants to know who is paying the doctor bills from the accident. We can help. For more than 130 combined years, the experienced personal injury attorneys at Lomurro Law have been helping New Jersey families, with dedication, skill, and a track record of success. We are available to answer your questions and meet with you for a confidential consultation to discuss your situation. Contact our office at 732-482-9285 or online to arrange your appointment.