Car owners have a lot of options when it comes to selecting auto insurance. But what about those who need car insurance… but don't own a car?
Non-Owners and SR-22 License Holders have special challenges when it comes to getting back on the road. But don't worry. Here's your complete guide to navigating Non-Owners Insurance:
Who Needs Non-Owner Insurance?
If you want to drive, you need insurance. Unfortunately, if you don't own a car, you don't qualify for many types of traditional car insurance. This is because most car insurance policies cover one driver connected to one vehicle.
What is a Non-Owner Insurance Policy?
Just because you don't have a vehicle doesn't mean you don't drive. Non-Owner policies are for anyone who doesn't own a vehicle but needs to drive. A non-owners policy is fundamentally similar to a traditional car insurance policy, but with one key difference.
Non-owner's policies are not vehicle specific. After all, the driver could be behind the wheel of a Ferrari one day and a garbage truck the next. For this reason, Non-Owner policies have NO physical damage full coverage. Non-owner policies are good for just one individual.
Aside from folks who don't own a car, there's another group of people in a similar situation when it comes to finding insurance. These are people who need an SR-22.
What is an SR-22?
Also referred to as a certificate of insurance or a financial responsibility filing, this is a document filed with the state DMV. The SR-22 provides proof that the individual filing has valid auto insurance.
Why would someone need to prove their insurance status in a special way? Because the SR-22 is for "high risk" individuals.
A "high risk" individual, as determined by the DMV, is someone who has lost their driving privileges. This could be due to:
Uninsured car accident
Driving with a suspended license
An SR-22 might be required for up to three years after conviction for the offense. Different states take different approaches to the SR-22, with some states accepting them as an alternative to proof of financial security.
What Types of Policies are NOT Available with a Non-Owner Policy?
Comprehensive – This is a policy which covers weather damage, theft and other damage which doesn't relate to other cars.
Collision – This is a policy which covers any direct collision between your car and another vehicle or object.
What Types of Policies ARE Available with a Non-Owner Policy?
Liability – This covers damage to other vehicles and people.
Medical / Personal Injury Protection – This covers your medical bills following a car-related injury.
Uninsured Motorist – This covers damage to you or your vehicle caused by an uninsured or underinsured motorist.
The Non-Owner Policy vs. the SR22
A Non-Owner policy functions similar to any standard auto insurance policy. If you have a Non-Owner policy, you're currently fulfilling the legal requirements for insurance in your state.
Here's the thing: If you need an SR-22, you can add that to the Non-Owner Policy just as you could to any other standard auto insurance policy. Even better, Non-Owner policies cost significantly less than a standard auto policy.
An SR-22 involves extensive fees already. You don't want to add the extra expense of buying a vehicle just so your document can be properly filed with the state.
What if you don't drive at all but you still need to file an SR-22? Unfortunately, you still need to buy auto insurance. The SR-22 requires insurance in order to be filed, and filing an SR-22 is the only way you'll be able to either prevent your license from being suspended or have your license reinstated.
How Does a Non-Owners Policy Work Practically?
If you have a Non-Owner policy, you're able to drive any vehicle. If you get into an accident, the Non-Owner policy will cover the damage caused to that injured party and vehicle up to the coverage limits.
A Non-Owner policy doesn't cover the vehicle you were driving when you had the accident, however. This opens up a few possibilities:
The vehicle is simple damaged and unrepaired
The vehicle is repaired out of pocket
The vehicle is repaired after the owner files a claim under his comprehensive or collision coverage.
How Do I Purchase Non-Owner Insurance?
This part gets a little tricky. Auto insurance companies do offer Non-Owner Insurance. They just don't advertise it very often. The market is small and, frankly, potential customers are considered a bit of a risk.
These carriers routinely offer Non-Owner Insurance:
Companies may stop offering Non-Owner policies at any time. In fact, these companies generally do NOT offer Non-Owner Insurance:
Non-Owner Insurance and SR-22
Obviously, nobody really wants to deal with an SR-22. But if you're stuck in that situation, you don't have a ton of options if you want to get your normal license back. The Non-Owner policy does make the entire process a bit cheaper and easier to navigate, however.
In other cases, the Non-Owner policy is a great solution for many unique situations. Maybe you're between cars, and don't want to let your coverage lapse but you also don't plan on buying a new car in the immediate future.
If you let your auto insurance coverage cancel or expire, obtaining new car insurance can be a hassle. You'll likely face higher rates, because insurance companies consider you a bit of a payment risk. A Non-Owner policy is a convenient workaround for when you want to stay insured.
Without car insurance, you won't be able to legally drive on the roads. For many people, Non-Owner insurance is not only the best option, it's the only option! Fortunately, if you're willing to track down the right policy for you, a Non Owner policy can put you back in the driver's seat in no time!