After a car accident here in California, what happens next depends on who owns the car, who was driving it, how it’s insured, and who else was involved. Things can get complicated when the crash involves a borrowed car.
Maybe you loaned your car to someone who wrecked it. Or maybe you were driving a friend’s car and someone caused a crash. You could even be an innocent driver who was hit in traffic, then later discovered the other driver had borrowed the car.
If you’re confused, don’t worry. We can help. Keep reading and we’ll clear up what could happen after someone borrows a car has an accident in California.
Sorting Out Permission and Insurance
Permission and insurance are two crucial factors when loaning or borrowing a car. In most states, including California, insurance generally follows the vehicle, not the driver. Therefore, if you let someone borrow your car and they get in an accident, your insurance policy typically covers the damages. This is also the case when a friend borrows and damages your car; your insurance usually acts as the primary coverage.
When it comes to loaning a car to an unlicensed friend or someone without valid permission, the insurance company may refuse to pay, and in some states, like California, the owner might face additional legal liabilities. Loaning a car to someone without insurance or who isn’t licensed can have serious financial and legal consequences.
California Vehicle Code Section 14604(a) states: “No owner of a motor vehicle may knowingly allow another person to drive the vehicle upon a highway unless the owner determines that the person possesses a valid driver’s license that authorizes the person to operate the vehicle.”
For uninsured cars loaned to another driver, both the vehicle owner and the driver may face liability for damages in an accident. Financial and legal risks are significant if the borrowed car lacks insurance coverage, making it important for the owner to ensure their vehicle is insured before allowing someone else to drive it.
Primary vs. Secondary Insurance With Borrowed Cars
Here is another wrinkle with car insurance. It’s important to determine who holds the primary liability coverage and whether there is secondary coverage available. The borrowed car is usually associated with the primary insurance coverage and the driver’s insurance is usually the source of the secondary insurance coverage.
Here’s how the progression of insurance coverage works. In most cases, the insurance company associated with the borrowed car will kick in first to cover the accident damages. However, if the person who borrowed the car causes damage that exceeds the coverage limits, their liability policy can act as secondary coverage. But their coverage only kicks in after the borrowed car insurance is tapped out.
To make this clearer, let us look at an example of how primary and secondary coverage work in an accident scenario. Imagine that you loaned your car to a family member and they caused an accident that injured someone. The primary insurance is your insurance – the insurance that covers the borrowed car – because you are the vehicle owner.
There is also secondary coverage from the driver of your car (the person that borrowed your car). This means your insurance, as the primary insurance, covers their injuries and damages up to the limit of your policy. Then, any remaining amount will be paid by the driver’s insurance, which is the secondary insurance in this scenario.
Of course, there is never a guarantee that either the primary or secondary insurance will actually pay when the time comes. You may need a car accident lawyer to help you with your case and put pressure on the insurance carriers to do the right thing.
Borrowed Car Insurance Policies by State
Understanding how insurance applies when a car is borrowed is key to avoiding unexpected liability. In most states, car insurance follows the vehicle, meaning the owner’s policy typically provides primary coverage if there’s an accident. However, specific rules vary by state and may require additional coverage from the borrower in certain cases.
The table below outlines borrowed car insurance policies across various states, including whether the owner’s or borrower’s insurance is primary and estimated coverage limits. This overview can help clarify your potential responsibilities when lending or borrowing a car.
| State | Borrowed Car Insurance Policies | Estimated Coverage |
| California | Owner’s policy is primary; borrower’s insurance may apply as secondary coverage if needed. | $25,000 – $50,000 |
| North Dakota | Owner’s policy is primary; borrower’s non-owner insurance may be necessary if the car is uninsured. | $30,000 – $60,000 |
| Indiana | Owner’s policy is usually primary, but coverage might vary if the borrower regularly drives the vehicle. | $25,000 – $50,000 |
| Florida | Owner’s insurance typically covers liability; borrower’s insurance may apply if they have “permissive use” coverage. | $20,000 – $50,000 |
| Texas | Owner’s insurance is primary; borrower’s insurance can cover additional liability if the damage exceeds owner’s coverage. | $30,000 – $50,000 |
| New York | Owner’s insurance is primary; however, borrower’s insurance might apply if the borrowed car lacks sufficient coverage. | $25,000 – $50,000 |
| Illinois | Owner’s policy is primary; borrower’s insurance may cover damages beyond the owner’s coverage limit if permitted. | $25,000 – $50,000 |
| Ohio | Owner’s insurance applies primarily; the borrower’s policy may supplement coverage if they have specific permissions. | $25,000 – $50,000 |
| Michigan | Primary coverage usually follows the car’s insurance; personal injury claims may also apply under Michigan’s no-fault laws. | $20,000 – $50,000 |
| Pennsylvania | Owner’s policy is primary; borrower’s policy might be used for secondary coverage, depending on “permissive use” status. | $25,000 – $50,000 |
| Arizona | The owner’s insurance is primary; borrower’s insurance can apply if the borrower exceeds the limits of the primary policy. | $25,000 – $50,000 |
| Virginia | Owner’s insurance generally covers accidents; the borrower may need supplemental coverage in some circumstances. | $25,000 – $50,000 |
| Georgia | Insurance coverage typically follows the vehicle; borrower’s insurance may provide additional liability coverage if needed. | $25,000 – $50,000 |
| Nevada | Owner’s policy is primary; borrower’s insurance might be secondary if coverage limits are exceeded. | $25,000 – $50,000 |
| Oregon | The car owner’s insurance generally applies first; borrower’s insurance may be secondary in cases of high damage. | $25,000 – $50,000 |
For additional information and detailed policy guidelines, you can refer to resources like The Balance on Borrowed Car Insurance, NerdWallet’s Guide to Non-Owner Car Insurance, and Edina Realty on Car Insurance Requirements by State.
These resources can clarify state-specific rules and provide up-to-date recommendations on car insurance policies.
Don’t Let Loaning Out Your Car Ruin your Life
Here’s the bottom line: Having insurance, including uninsured motorist insurance, is extremely important. Without it, you could owe the expensive costs of a severe car accident whether you were driving or not. While California only requires a minimum of $15,000 in coverage, a car accident can easily exceed this amount.
Too often, a nice person loans their car to a family member or a friend and ends up regretting it after a crash. One car accident can drain a bank account and ruin a friendship forever.
If you’re facing a situation like this, contact the team at Sally Morin Personal Injury Lawyers. We’ve helped plenty of people in your shoes. You’ll find that we’re caring, compassionate, and exceptionally experienced with car accident cases.
Accident Loans in California
A car accident can lead to unexpected and often substantial expenses. If you’re struggling to cover costs such as medical bills, vehicle repairs, or lost wages, you might consider an accident loan. These loans are designed to provide financial assistance specifically to individuals who have been in an accident. They can offer immediate access to funds and often have flexible repayment options. However, it’s important to research different lenders and understand the terms and conditions before taking out a loan. For personalized financial advice, consult with a qualified financial advisor
We Handle Your Accident Claim So You Can Focus on Your Life
After an accident, contact the attorneys at Sally Morin Personal Injury Lawyers. We handle many types of traffic injury claims, including car accidents that involve borrowed vehicles. We believe you should be able to focus on recovering from your accident while we handle the legal details.
We truly care about the people of California. Contact us today for a free online case evaluation.
Video Transcript:
A popular question I often get is, what coverage applies when someone else is driving my vehicle and they get in an accident? So the simple answer is, in California the insurance follows the vehicle instead of the driver. So if you grant permission to someone and allow them to drive your car, so either hand them the keys or if it’s just implied that they have permission to drive your vehicle, your insurance coverage would apply if they get an accident or hit a parked car, anything like that. The one caveat to that is if they borrow your car without your permission or your car is stolen or something like that and they get in an accident. But just be careful who you allow to drive your vehicle because your insurance coverage will apply if you grant them permission to drive it.
