Driving without permission: What is covered by insurance?

Most of us know that the liability coverage on our auto insurance policy covers us for accidents when we are driving our own car.  But what happens when we drive a borrowed car, or when we allow someone to borrow our car?  Is a borrowed car covered by insurance?  Whose insurance provides coverage?

Under Virginia law, the key to answering these questions is permission.  If a driver borrowing a car has the permission of the owner, then the owner’s insurance will provide coverage. Virginia Code § 38.2-2204 requires that policies cover any person using a motor vehicle “with the expressed or implied consent of the named insured.”  In addition, if the person borrowing the vehicle has their own insurance policy, that policy would provide coverage on top of the coverage on the borrowed vehicle.

driving a car without permission virginia what is covered

What happens if the person borrowing the vehicle goes beyond my permission?

According to the same code, a person borrowing a vehicle must stay “within the scope” of the permission or there is no coverage.  What “within the scope” of permission means is that a person borrowing my car can only use it with the permission that I have given them.  For example, if I loan my car to my neighbor so he can drive to work and back while his car is being repaired, my neighbor does not have permission to drive my car to the beach for the weekend.  If my neighbor crashes the car while at the beach, there is no coverage because he was using the car beyond the scope of the permission that I gave him.   

Note that in the beach example, my neighbor’s own insurance policy will not cover him either—so exceeding the scope of permission is particularly troublesome.  Your own policy covers you when borrowing another’s vehicle only when your use is with the express or implied permission of the owner.

What if I allow my teenager to drive my car and she loans it to a friend?

If you loan the car to your teenager, they are covered by the policy on the car.  But does the policy cover the vehicle if your teenager loans your car to a friend?  In Virginia, the answer is generally yes. The person borrowing from your teenager is allowed to rely on your teenager’s permission to borrow the car.

What happens if I tell my teenager that the car is only for his use?

A person borrowing a vehicle from another person who has permission to borrow from the owner is entitled to rely upon the permission given from the first borrower or “custodian” of the car.   This is so even if the owner loaned the car expressly telling the first borrower not to let anyone else use it.  As a parent, this may not provide much comfort, but it does make sense from a public safety standpoint. This is because it would be unfair to the victim of an accident if there is no coverage if the borrower-driver thought he was driving with permission.

Note that Virginia law can get very complicated and individual fact situations can change the answer on these questions.  The best advice is to make sure that you have the permission of the owner of an automobile before operating it.  That way you will be sure you are covered both under the owner’s policy and your own.

If you have any doubts about insurance coverage, or if you are injured in an accident where you have questions about coverage, consult an attorney.   At Allen & Allen, we have many attorneys who are very knowledgeable about insurance law and frequently deal with insurance coverage issues.