My best friend borrowed my car to run some errands and was in an accident. She's at fault for the accident. Do claims for damages to my car and the other car she hit go through her car insurance policy or mine?
Ava M., Escondido, Calif.
Good question, Ava. Most people let a friend operate their car at some point, and whose insurance will pay for an accident isn't likely a topic of conversation when your friend takes the keys. For better or worse, claims go through your car insurance, since you are the owner of the car at fault in the accident.
When you allow someone to use your car, your policy is primary. If your liability limits are exceeded, the driver's own auto insurance may be used as excess insurance.
Auto insurance companies know that policyholders let friends, visiting relatives and neighbors borrow their cars from time to time. Unless these individuals live in your household or use your vehicle on a frequent basis, they usually are not required to be listed on your car insurance policy.
Instead, most car owner's insurance policies cover these types of drivers as permissive drivers. Basically, this means you gave the person permission to operate the vehicle. As a result, your car insurance coverage will extend to that person while he or she drives the vehicle.
Because your car insurance is primary, the driver your friend hit will put in a claim for vehicle damages through your property damage liability coverage. If the other party was injured, a claim for injuries would go under your bodily injury liability coverage.
If your limits are exceeded, your friend's auto policy may be tapped to pay any amount your policy does not cover. If the damages are more than both insurance policies can cover, you and your friend may be on the hook for the remaining damages. You did not cause the accident, but as the car owner, you have vicarious liability for those who drive your car with your permission.
For your own vehicle's damages, you need to put in a car insurance claim through your collision coverage. You may want to ask your friend to cover the deductible amount since she is the one responsible for the accident and resulting damages.
If you don't have collision coverage, discuss with your friend how she is going to pay for the repairs for your vehicle. Hopefully, your friend will be willing to pay for her mistake, and it won't harm your friendship.
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