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Sharing A Car -- And Risk -- For Spring Break

Question: Will my car insurance policy cover other young drivers, in addition to my daughter, taking turns driving my car during spring break?  I'd prefer she isn't stuck driving the long distance on her own.

Answer: This is one of those times when no-frills car insurance policies can come back to haunt you.

While many car insurance policies extend to permissive drivers (those whom you give permission to drive your vehicle), there are restricted policies that are written so that only drivers named on the policy are covered. Insurance companies that offer restricted policies usually do so to give you cheaper rates than you would obtain elsewhere. 

If you purchased your policy with restrictions tied to it, then your daughter (who I assume is listed as a driver) may be the only one covered to drive during spring break. (For general guidelines, see “ Who can drive your car?”)

Your insurance company is always the best source to answer specific questions about coverage and limits -- especially before your daughter leaves town. Even if your policy extends to permissive users of your car, verify that your car insurance policy doesn't have any other restrictions, exclusions or provisions that could affect your daughter (and her friends) when driving during spring break. 

Some policies that cover permissive users exclude coverage for drivers under a certain age; others change your coverage limits; and some even increase your deductible.

For example, some auto insurance policies have what is referred to as step-down provisions,  allowing the insurer to reduce your liability limits to only the state required minimum limit in certain situations, such as when a driver that is not listed on the policy operates your car.

Remember a car owner can be held liable along with the driver of an accident; thus lower liability limits could put your assets at risk.

Also, some insurance policies will drop down your liability coverage to the minimum liability limits of the state in which you are driving when the insured vehicle is driven out of state.  So, if your daughter is driving out of state for spring break, make certain you know what coverages and limits extend out of state to cover her and her friends.

We'd also recommend that before your daughter allows anyone to drive your car that she checks that the driver has a valid license.  Some auto insurance policies exclude coverage for unlicensed drivers, and some states will ticket not only the unlicensed driver but also the car owner for allowing an unlicensed driver to operate their vehicle.

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