| SR-22
FORM
Non-owner
insurance coverage does not include collision
or comprehensive insurance, which means that
non-owner insurance coverage will not cover
the repair or replacement of the policyholder’s
own car if damaged or stolen.
Keep in mind that non-owner
insurance coverage always equates to an “excess”
of the liability coverage originally purchased
by the owner of the vehicle. In other words,
if you have an accident the owner’s liability
insurance pays initially, until the amount reaches
the limit of the policy. Named, non-owner insurance
coverage invokes when the cost of injuries and/or
property damage exceeds the limit of the vehicle
owner’s liability policy.
Occasional misuse of
named, non-owner insurance coverage typically
pertains to teenage drivers. In an attempt to
save money, parents often inquire about excluding
their teenager from the family policy instead
of the more economically sound alternative of
purchasing non-owner insurance coverage.
By attempting to skate
around paying insurance costs for teenage drivers
by only buying a non-owner insurance coverage
policy typically marks a bad idea as non-owner
insurance coverage simply provides additional
liability when driving a vehicle you don’t
own. If you elect to purchase only non-owner
insurance coverage and not include your teenager
on the policy, neither the non-owner insurance
or your normal policy will cover the damage
to the vehicle when involved in an accident.
On the bright side, in the event of a two-car
accident with the other driver at fault, you
could still recover repair costs from that driver’s
policy.
Another point to remember
is you may find yourself unprotected financially
if you are held liable for an accident caused
by your teenager if they are still a minor.
But, with the non-owner insurance coverage policy
rated properly, the price of your teenager’s
liability coverage could equal or exceed the
cost if he or she were on your policy.
You might also find yourself
unprotected financially if held liable for an
accident caused by your child while he or she
is still a minor. Finally, if the non-owner
policy is rated properly, your teenager’s
liability insurance might cost as much as or
more than it would cost if he or she were on
your policy.
*The material above was provided for informational
purpose only. Completes and the accuracy of
the material is not guarantee.
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