What Happens to Your Insurance If a Friend Crashes Your Car?

Lending your car to a friend may lead to unexpected costs if an accident occurs. Understanding how your auto insurance applies and where gaps may exist can help you avoid out-of-pocket expenses. Pan American Insurance can guide drivers in El Paso, Anthony & Socorro, TX toward coverage that aligns with their budget and priorities.

How Texas Auto Insurance Handles Permissive Use

In Texas, auto insurance typically follows the vehicle, not the driver. If you give a friend permission to use your car, your policy is usually the primary coverage if an accident occurs. Here’s how it may apply:

• Liability coverage may pay for injuries or property damage to others, up to your policy limits.
• Collision coverage may help cover damage to your vehicle, minus your deductible.
• Your friend’s insurance may apply as secondary coverage if damages exceed your limits.

Potential Impacts on Your Insurance

Allowing someone else to drive your car can affect your insurance in several ways:

• Claims and rate increases: If your friend is at fault, the claim may be covered under your policy and increase your premium at renewal.
• Exclusions: Some policies exclude certain drivers or situations; if your friend regularly uses your car but isn’t listed as a driver, coverage may be denied.
• Non-permissive use: If your car is taken without permission, your insurer may deny coverage and your friend’s policy may become primary.

What If the At-Fault Driver Has No Insurance?

If an uninsured driver hits your car while a friend is driving, your UM/UIM coverage may help pay what the at-fault driver cannot. Check that your limits are high enough, as minimum coverage may not cover major medical or repair costs.

We Support Texas Drivers

Contact Pan American Insurance today to request a free custom quote.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.