Can You Insure a Car That's Not in Your Name?
Most auto insurance policies cover a vehicle owned by the holder of the policy. There are times, however, where you may take custody of a car that is not registered to you, but of course, still need insurance for.
Getting insurance for a car you do not own may prove to be difficult. We go over the instances where it may be possible, as well as alternatives to explore, such as non owner car insurance.
Can you get insurance for a car not registered to you?
You can get car insurance for a car you do not own in certain cases, though many states and auto insurance company are not willing to do so. The main issue comes down to ‘insurable interest’ in the vehicle.
When you get insurance for a car that you own, there is an assumption you have a stake in the well being of the car. Most car owners wouldn’t want to crash their car because of the repair costs and the risk of loss on an investment.
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When you are not the owner of the car, that assumption cannot be automatically made. After all, if you crash a car you didn’t buy, you don’t stand to lose any money.
Before you attempt to prove your insurable interest though, you should realize there are some situations where this is impossible.
State laws may prevent you from insuring a car you don't own
In certain states, registration and car insurance go hand in hand. States like New York require you to have insurance in order to register a vehicle in the state. If the car you are supposed to inherit is registered in someone else’s name, that means there should already an auto insurance policy on that car — in the owner’s name.
New York
This information may not be explicitly detailed on your own state’s DMV page. You may have to call either your state DMV or your insurance company to see whether it is legal to have an insurance policy that differs in name from a car’s registration name.
Even if it's legal, it can be a burden on the owner of the car
The owner of the car will likely have to take on a lapse in auto insurance coverage if they need to cancel their insurance and pass on the vehicle to you.
California
In California, the name on the registration and the insurance don't have to match. But since every state (including California) requires you to have car insurance before you can register a car, that means there should already be a car insurance policy on that vehicle.
- Whoever has the policy on the car at that moment would have to cancel their policy thus incurring a lapse — which as we found, can be expensive.
- Unless you live with that person as well, you wouldn't be allowed to join their policy either.
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