Lending your vehicle to another person is something that you may do without thinking through the ramifications. You may even feel pressured to do this “small” favor for a close friend, who you assume would do the same thing for you. Many feel guilty not accommodating a sincere request from a friend. It is not comfortable to be caught off guard when someone asks to borrow your automobile and having to scramble around to think up an excuse not to let them. It is worse just to lend it to them without knowing what the risks really are.
Here are the things you should do:
1. Check with Your Insurance Agent About Casual Drivers
First, you need to know if other drivers are covered under your auto policy. This is a good reason to pick up the telephone and talk with your agent at E.S.T.I.R. Inc. in Newark, NJ. Ask your agent if casual drivers are covered in your policy and what the rules about them are.
2. Understand the New Jersey No-Fault Rules
New Jersey is a no-fault state. Residents must carry auto insurance to legally operate a vehicle within the state. There are the minimums for coverage under a “basic” policy which are:
- Property damage liability (PDL) $5,000 per accident.
- Personal injury protection (PIP) $15,000 per person, per accident.
- Up to $250,000 for very serious injuries.
New Jersey residents have the option to choose a “standard” policy, by paying a higher premium, which has higher limits, covers more, and has the option to choose not to have any restriction on the right to sue a person who caused the accident. Ask your insurance agent about the options.
3. Consider Your Feelings
If the friend that borrows your car gets into an accident, even if it was the fault of the other driver, your insurance is going to have to pay the claim for your vehicle and its occupants. This can cause your premiums to rise, which is uncomfortable when you did not have anything to do with what caused the problem. Talk with your agent about these issues. You may do better paying for a rental car for your friend instead and making sure it is insured properly.
You need to think carefully before loaning your car to another person. If you are considering this, contact your agent at the E.S.T.I.R. Inc. agency serving Newark, NJ and the surrounding areas. Ask for an auto insurance review and a quote to be sure you have adequate coverage.