One of the common things I have seen many international students or professionals do is to drive others cars or rental cars without any proper insurance on their name. It is very dangerous and many do not realize the importance of it. I like to highlight few consequences and also explain about rental cars and how insurance works there.
Basic Insurance Terms : Liability & Collision
There are tons of terms, but on the very high level, there are only two thing one is Liability and other is Collision ( some names vary). When you have liability on the insurance, it means that if you hit some other car and it is your mistake, your insurance will cover the damage cost of the other person’s car. However, just having liability will not cover expenses to fix your car damage. To have your car fixed too, you need to have collision taken. If you have both Collision and Liability taken, then it is considered as Full Insurance. If you have full insurance, if you hit someone or someone hits you or your car was hit in parking lot by cart or anything, etc. Your insurance will cover your damage. (There are many other details like bodily injury, uninsured motorist, etc…lets forget all of them to keep things simple)
Why NOT to drive anyone’s car without your insurance on it?
Two scenarios: 1. Rental Car 2. Someone else’s car.
- Rental Car : If you are driving a rental car, you have to have your name included in the rental car agreement as driver and you have to have insurance taken, otherwise if you drive and hit any other car, insurance will not cover anything. In fact, it is illegal for others to drive without insurance on it. I know some people just take the rental car and drive, but it is risky.
- Someone else’s car : It is same as above, insurance will NOT cover any damage you have done if you do not have insurance on your name. You have to be added as a member in the insurance. There are many minor complications all over and some conditions where it will cover and I do not want to write all that. The point I am trying to say is, DO NOT Drive without your insurance name on the car. It is risky.
Also, if you are a new driver and renting a car, take FULL Insurance, it will help you. Especially if you are new driver and practicing in USA and having an international driving license.
Image Credits : http://www.flickr.com/photos/mattimattila/3762045463/