If you are wondering if your child needs auto insurance if they don’t have a car, the answer really depends upon where you live in the US. Some state auto insurance laws require that all licensed drivers carry auto insurance while others only require people with registered vehicles to carry auto insurance.
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When exactly do minors need car insurance? If they’re going to be driving, you probably want them to be covered! If you aren’t sure if your state has these requirements you can find out easily by visiting your DMV website or the website for the Department of Insurance.
Most sites these days have a search option so that you can do a quick search for the answers you need rather than having to search through the entire website on your own.
How do I get auto insurance for my teen if they don’t have a car to cover?
In you have a teen driver then you may want to consider the option of using a non-owners auto insurance policy. This is a generic liability only policy that allows you to maintain auto insurance coverage without having a particular car attached to it.
There are some upsides and downsides to choosing this type of coverage.
The upside here is that the insured driver is able to drive any vehicle, even those that are insured with a policy that doesn’t cover unlisted drivers. If there is an emergency, or your child is frequently borrowing vehicles others, at the very least you know that if he or she causes an accident, then the liability part of that accident is covered.
Another upside is that car insurance companies offer better rates to people with established insurance coverage. What this can mean for your teen is that when the time comes and they purchase a vehicle of their own, they may receive a reduced rate for maintaining their non-owners policy.
It is important to note that if your child had several car accidents while carrying a non-owners policy, they aren’t going to be receiving any discounts when it comes time to purchase a full insurance policy.
The downside to carrying a non-owners policy is that it can often be a lot more expensive than carrying a liability only policy on a specific car. The reason for this is that a non-owners policy has to cover you whether you are driving a Porsche, which if a teen is driving increases their risk of having an accident, or you are driving a beater with no breaks to speak of.
With the potential for your teen to drive virtually any type of car, the insurance company has to consider whether or not they might be in a higher risk situation by driving an unsafe car, a muscle car and so on.
The other downside to non-owners auto insurance is that it is liability only insurance. If your teen has this coverage and causes an accident, the policy will only cover the damages to the vehicle(s) that he or she is responsible for causing to other vehicle, NOT to the vehicle that they are driving.
This means, if the person who owns the car has insurance that won’t pay for the damages, that you and your teen could be responsible for the repairs to the vehicle.
What happens if insurance is required, but my teen doesn’t purchase any or allows the policy to default?
If you don’t have insurance in the first place, your teen will be unable to get their driver’s license at all. If, however, you have insurance when your teen gets their license, but they allow their insurance to default, then the insurance company will inform the DMV.
What happens next is the same thing that would happen for any driver. The driver’s license is suspended until such time your teen can produce proof that they were carrying the required insurance.
If your teen drives uninsured, and is caught, this will go on their driving record. They will receive a fine and, depending on where you live, your teen could end up in jail!
Should I get non-owners insurance if it isn’t required?
There is no simple yes or no answer to this particular question because it really depends on your specific situation. If you know that your teen is going to be driving other people’s vehicles, then the responsible thing to do is to purchase non-owners insurance.
If you decide to let your teen drive your vehicle and they have an accident, you could find yourself in a position where your insurance company refuses to pay. The assumption will be that you let your teen drive often, and that you chose not to add them to your policy or purchase them their own insurance.
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