Can You Carry Auto Insurance for a Car if the Title is Not In Your Name?

A driver asking “can you get insurance without a car” and “can I insure someone else’s car”. will be happy to learn it is possible. You can carry an auto insurance policy for a car if the title is not in your name, if you prove insurable interest, have a title loan, or purchase non owner insurance.

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Rachel Bodine graduated from college with a BA in English. She has since worked as a Feature Writer in the insurance industry and gained a deep knowledge of state and countrywide insurance laws and rates. Her research and writing focus on helping readers understand their insurance coverage and how to find savings. Her expert advice on insurance has been featured on sites like PhotoEnforced, All...

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Leslie Kasperowicz holds a BA in Social Sciences from the University of Winnipeg. She spent several years as a Farmers Insurance CSR, gaining a solid understanding of insurance products including home, life, auto, and commercial and working directly with insurance customers to understand their needs. She has since used that knowledge in her more than ten years as a writer, largely in the insurance...

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Reviewed by Leslie Kasperowicz
Farmers CSR for 4 Years

UPDATED: Aug 18, 2021

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What You Should Know

  • Most insurers are reluctant to sell an insurance product to drivers who don’t have the title in their names
  • While you can insure a car that is not in your name (owned by someone else), you will need to prove insurable interest or get non-owner insurance
  • If you don’t own a car because you are still paying off loans, you will need to take out a title loan

Are you wondering, “Can I insure a car that is not mine?” Generally, when you take out auto insurance coverage, it is assumed that the person taking out the insurance and the car’s owner are the same. That means that you are taking out insurance to protect your own motor vehicle so that any damage that you are liable for will be paid out by the car insurance company.

But can someone else insure your car if the title is under your name? Does the title of a car have to be in your name to get insurance? Understanding auto insurance questions like this can be a headache.

Luckily, you have several options in this case and finding the right solution is an important way to avoid paying over the odds while at the same time ensuring that you are actually protected and won’t land yourself (or the car owner) in trouble. Read on to find out more.

If you want to jump right into finding insurance coverage for a car, even if the title isn’t in your name, use our free tool above.

How Can I Insure a Car Not in My Name?

A scenario where you might be thinking of getting insurance for a car other than your own might be, for instance, if you wanted to insure your child to drive their car.

But this is why insurers don’t always like you to do this.  When you insure your child to drive a car but use your name and details, you are not forthcoming in regards to the details of the driver. The insurer needs to know that they are young because this increases the risk from their perspective and thereby increases the cost of their insurance most often.

So with that in mind, how do you go about insuring someone else’s vehicle? What is most important here is to shop around and to find an auto insurance company that openly states that it will be happy to insure someone else to drive the vehicle. You can check out our list of states with the cheapest car insurance, and try speaking with an insurance agent. You can also just call a few insurance companies to discuss the possibility.

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What is Insurable Interest?

In most cases, you will need to demonstrate an ‘insurable interest,’ which might mean that you have something to lose if the car gets totaled. An example of this might be if the car was a joint purchase and the owner only wanted to take out third party insurance. Demonstrating this insurable interest can be hard, though, and in many cases, you might find that companies struggle to understand why you would want to take out this kind of insurance – perhaps rightly so!

According to FindLaw, having a proven insurable interest is vital to making sure insurers don’t deny claims, which can lead to bad faith lawsuits and breach of contract lawsuits. if there isn’t a clear insurable interest, it is too easy for both the customer and the insurer to commit insurance fraud.

There is also additional interest, where you can add a vehicle owner to your insurance policy as an “additional interest.” This is the smarter option that will be more appropriate in the vast majority of cases, as it makes the other person a named driver on your insurance. Here, you will insure your vehicle but you will then add the name of the driver to your policy. They will then be allowed to drive the car as though it were their own but the insurance policy will belong to you.

There is also additional interest, where you can add a vehicle owner to your insurance policy as an “additional interest.” This is the smarter option that will be more appropriate in most cases, as it makes the other person a named driver on your insurance. Here, you will insure your vehicle, but you will then add the driver’s name to your policy. They will then be allowed to drive the car as though it were their own, but the insurance policy will belong to you.

In most situations, this option will cover the situation and allow you to insure a car that someone else is driving and that they can legally own. Otherwise, why not just agree to pay for the insurance for the driver and get them to agree to give you the amount that you’re entitled to should there be any kind of car accident?

What is Non-owner Insurance?

If you are driving someone else’s car, you may be able to buy non-owner insurance. A non-owner car insurance policy generally only includes liability insurance, not collision or comprehensive coverage. Take a look at the table below to see how much liability coverage generally costs.

U.S. Average Liability Insurance Rates
U.S. Average Liability Insurance RatesAnnual Rate Monthly Rate
2011 $492.03$41.00
2012$503.28$41.94
2013$517.88$43.15
2014 $530.01$44.16
2015$538.73$44.89
Average $516.39$43.03
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This option is usually easier than proving insurable interest on the car you drive, even though it doesn’t provide as much protection.

What Are the State Laws about Insuring Someone Else’s Car?

In most states, there is no law saying that the auto insurer or insurance provider and car owner must be the same. However, just because something is legal, that does not mean that it is necessarily the done thing, or that it is going to be a walk in the park.

Unfortunately, while you are technically allowed to take out insurance on a car other than your own, this is something that certain insurers don’t like and you might find as a result that it can be hard to find auto insurance policies that will allow you to do the same.

What’s more, is that some auto insurance policies will let you take out the insurance (most likely because you have applied online and they haven’t asked the right questions) but will then quibble the situation when you come to claim. You need to be very careful here as you are in murky territory!

One of the easier ways to get non-owner car insurance on a vehicle you don’t own in a state is to be added to the vehicle registration. This generally makes it easier to buy an insurance policy, as your name will be on the vehicle registration.

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Can You Get Title Loans on Car You Don’t Own?

There are some exceptional circumstances where this won’t be an issue at all. One example is if you take out a title loan. A title loan is a type of loan that is common when getting insurance for financed vehicles. You will be using an asset as collateral, meaning that if you fail to pay the loan, the lender will be entitled to claim your possession.

Of course, in this case, the asset in question is the car. When you take out this type of loan, you transfer the title of your car to the lender and they will then legally own your car until you finish paying off the loan.

This means that you can afford a bigger loan by getting better auto insurance rates – and the lender will be happy to lend you the car for those cheaper car insurance rates because they will have a form of guarantee that they will get the money back. If you struggle to pay off the loan, they will have the option to simply sell your vehicle and use that to offset the outstanding balance!

You still need to be insured, however, the title is not yours. That means that in this scenario, the auto policy is for a car that doesn’t legally belong to you – but most insurance companies will be familiar with this concept and will have no problem insuring your vehicle!

The big question now is what happens if you should have a car accident? The answer is that the insurers will pay out in full as usual, but they will pay the money to the lender rather than to you and that money will be used to pay off some of your loan.

There are always ways around the situation, just make sure that the auto insurance company knows as much as possible about everyone driving the car and where it will be stored, etc. That way, there can be no unhappy surprises when you come to claim.

Even if the car title is not in your name, you can start shopping for non-owner  auto insurance policy rates right away by using our free tool below.

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