Texas is a fault state, so all drivers must carry liability insurance to protect themselves if they’re in an accident. If you’re injured in an accident that wasn’t your fault, you can recover the costs of your medical treatment, property damage, and other losses from the at-fault driver’s insurer up to the limits of their policy.
Similarly, if you cause an accident that injures someone else, your liability insurance will kick in, protecting you from paying from your own pocket.
The minimum auto insurance policy requirement is $30,000 for injuries per person, up to a total of $60,000 per accident, and $25,000 for property damage, although drivers may opt for increased coverage.
But what happens if you’re in an accident and the car is insured, but the driver is not on the insurance policy? This might happen if an insured driver lets a friend borrow their car, or the vehicle has been stolen.
Insurance claims can quickly become complicated if the driver involved in the accident isn’t on the car’s policy. For tailored advice about your situation, it’s wise to consult an auto accident attorney.
Explore your options for recovering compensation if you’re injured in a car accident caused by a negligent driver who isn’t listed on the vehicle’s insurance policy. Our McAllen and San Antonio car accident lawyer can assess your claim and determine the best avenue for pursuing the compensation you deserve. Click to book a free, no-obligation case review.
Need Advice on a Specific Situation? Choose Your Scenario Below:
- The Driver Is Not Listed on the Insurance Because They Have Borrowed a Car
- The Driver Is Not Insured Because They Have Stolen the Car
- The Borrower Is an Excluded Driver
- The Borrower Was Intoxicated
- The Uninsured Driver Used a Borrowed Car for Commercial Purposes
- The Driver Regularly Drives the Vehicle and Should Be on the Policy
- A Driver Is Not Listed on Insurance, and the Policy Provider Refuses Coverage
- The Driver Has Personal Liability Insurance
- A Third Party Might Be Liable for the Accident
- Check Your Insurance Policy
- Negligent Entrustment Might Apply
Does Insurance Follow the Car or the Driver in Texas?
Whether you can claim your expenses from a driver who is not on a policy boils down to one question:
“Does car insurance follow the car or the driver?”
In most cases, auto insurance follows the car. It used to be the case that motorists could benefit from cheaper “named driver” policies. As the name indicated, these policies exclusively covered the policyholder and any additional individuals explicitly listed on the policy. However, Texas law prevented insurance companies from offering these policies for renewal with the introduction of House Bill 259 in January 2020. The benefit of this is that individuals injured in an accident can typically pursue an insurance claim when an at-fault motorist is not listed on the vehicle owner’s policy as long as the car itself is insured.
Why Might a Car Be Insured but a Driver Not Be on the Policy?
Any motorist who regularly drives a car should be listed on the auto insurance policy. A policyholder can list any individual who lives with them, including:
- Teen children
- A spouse
- A parent
- A caregiver.
But if you lend your car to a friend to run an errand or a family member who does not live with you borrows your car because theirs has broken down, you might not want to put them on your policy. If you lend your car to a loved one in an emergency, they might even make their trip and back before you can even speak to your insurance company.
The Driver Is Not Listed on the Insurance Because They Have Borrowed a Car
Individuals who do not drive a vehicle regularly do not need to be listed on an auto insurance policy, and because insurance follows the car, the policy will typically provide coverage.
There is a caveat, though: the driver must have permission to drive the car.
Permissive Use
Permissive use is the explicit or implied permission from the insurance policyholder for the driver to operate their vehicle.
For example, if a policyholder lets their friend borrow their car to run an errand and the friend causes an accident that injures you, you can generally recover your losses from the owner’s insurance.
It’s vital to consult an auto accident attorney, as some policies may provide limited coverage for permissive use or none at all. It can also be challenging to prove the at-fault party was allowed to drive the vehicle; the driver may claim they had implied consent because the owner previously gave them a key or that the owner verbally consented for them to borrow the car.
Non-Permissive Use
Non-permissive use applies when a driver takes a person’s vehicle without consent.
Whether or not you can recover compensation from the driver’s insurance depends on their relationship with the owner.
If the driver is a family member, the car owner is responsible for paying your damages under the Family Purpose Doctrine — regardless of whether they gave permission — under the assumption that the family vehicle is intended for family use. However, most auto insurers require customers to include all household members with a license in their policy unless they can prove they already have separate coverage.
When an Auto Insurance Company Might Deny Coverage for Drivers Not on the Policy
There are several exceptions to the “insurance follows the car” rule. In these scenarios, the insurer will likely deny coverage.
The Driver Is Not Insured Because They Have Stolen the Car
When a driver steals a vehicle and causes an accident, it’s safe to assume the driver will not be on the policy and the owner did not consent to the car being taken.
A thief might also be a friend or acquaintance of the owner who is not on the policy and does not have permission to borrow the car — under the law, they have stolen the vehicle.
In most cases, the owner’s insurer will deny coverage when a car is stolen. However, you may still be able to recover damages from the driver. You can also file a claim with your insurer. You can read our blog to learn about your options for paying for your medical bills and other losses if you cannot recover damages from the at-fault party or if you have urgent bills to pay while you resolve your claim.
Related: Who Pays the Medical Bills after an Accident? Your Options for Covering Your Losses
However, if the vehicle owner was negligent and could have reasonably foreseen their car might get stolen, they can be held responsible for your injuries and losses — for example, if they left their vehicle unattended with the keys in the ignition or parked their car and walk away without locking it.
The Borrower Is an Excluded Driver
Just as policyholders can explicitly name individuals on a policy to ensure coverage, they can also exclude people. If a vehicle owner lends their car to an excluded driver and that individual causes your accident, the insurance company will typically deny coverage. Insurers may also exclude drivers with a poor driving record, limited experience, or previous convictions for driving offenses.
The Borrower Was Intoxicated
Auto insurers will typically refuse coverage if a driver is not insured and violates a law or traffic regulation during an accident.
The Uninsured Driver Used a Borrowed Car for Commercial Purposes
Standard auto liability insurance does not provide coverage when a driver borrows a car and is using it for commercial purposes — such as ridesharing or making deliveries — when they cause an accident. Drivers must have dedicated commercial coverage, which does not carry over to other vehicles.
The Driver Regularly Drives the Vehicle and Should Be on the Policy
Insurers may offer discounts on multi-driver policies, but insurance will, of course, still be more expensive than single-driver coverage. Listed drivers are also authorized to alter a policy and even terminate the coverage without consent from the person who initially took out the insurance, and premiums may prove more costly based on a listed motorist’s age, driving record, and credit history.
As such, policyholders may neglect to add a regular driver to their coverage to reduce their premiums.
While insurance typically follows the car, an insurer may deny coverage if a person who regularly drives a vehicle is not listed on the policy.
So, what are your options for recovering your losses if the car owner’s insurance provider denies your claim?
What Happens If a Driver Is Not Listed on Insurance and the Policy Provider Refuses Coverage
Recover Your Damages from the Driver’s Personal Liability Insurance
Drivers must have personal auto liability insurance, regardless of who vehicles might belong to. You may be able to recover your damages by pursuing a claim with the driver’s insurance provider. Doing so can be challenging, as the insurer may push back and state they will only honor claims involving the driver’s own vehicle. Our McAllen and San Antonio car accident lawyer can help you explore your options.
You should also check whether the driver of the vehicle has non-owner car insurance. This policy provides coverage to individuals who do not have a car but drive one owned by someone else. Like standard liability policies, non-owner insurance provides coverage for injuries and property damage the driver causes.
Explore Whether a Third Party Might Be Liable for Your Accident
Car accidents can be complex, and multiple parties can be at fault. Exploring whether a third party might be liable for your accident could provide an easier route to recovering damages.
In a multi-vehicle crash, the driver not listed on insurance may be majorly at fault, but another motorist may have contributed, giving you an alternative route for recovering damages.
Sometimes, accidents occur due to an auto defect — such as a brake or engine failure — and you may be able to hold the manufacturer liable. For example, you might be sharing the road with a driver who has borrowed their friend’s vehicle but is excluded from the policy. They abruptly swerve into your lane, and you try to avoid a collision, but your brakes fail. The other driver is primarily liable, but the insurer covering the car denies coverage on account of the driver being excluded. However, you may be able to hold the manufacturer liable if you can prove:
- The brake fault existed
- The manufacturer knew about the fault and failed to rectify it
- The brake fault contributed to your accident and injuries
- You would have avoided or minimized harm if your brakes worked as expected and intended.
Check Your Insurance Policy
You should also review your insurance policy to see what it includes. Additional policies such as uninsured/underinsured motorist coverage (UM/UIM) protect you if you’re in an accident with a driver who doesn’t have insurance or whose insurance does not cover your damages. With this coverage, your insurance company will cover your losses up to your policy limit.
Personal injury protection (PIP) compensates you for medical expenses and lost wages, whoever is liable for the accident. Filing a claim with your insurance provider can help you cover any immediate bills and support your family while you recover from your injuries.
If another party is at fault for the accident, your insurance company may pay your claim and seek to recover the amount through insurance subrogation.
Determine Whether Negligent Entrustment Applies
Negligent entrustment is a legal doctrine that holds the vehicle owner liable for an accident if they permit an unlicensed, incompetent, or reckless driver to borrow their vehicle.
If the vehicle owner’s insurer refuses to budge, you can pursue damages directly from the driver.
Speak to a Personal Injury Lawyer
As we’ve seen, car accident liability can quickly get complicated when the person who has caused your crash did not own the vehicle they were driving.
It is vital to contact a personal injury lawyer in Texas if you’re injured in an accident where the car is insured, but the driver is not.
It’s not uncommon for both the driver’s insurance company and the vehicle owner’s insurance company to get involved and dispute who should pay. Having a lawyer on your side allows you to determine where your best chance at securing compensation lies and understand complex policy agreements so you know what is covered and when an insurer will honor a claim.
Whoever was driving the vehicle that crashed into you, and regardless of whether they had permission to drive the car or not, you deserve to be compensated for your injuries when an accident wasn’t your fault. You shouldn’t be left to suffer and struggle to afford your medical bills just because the person who crashed into you doesn’t own the car they were driving.
Our McAllen and San Antonio car accident lawyers are dedicated to helping car accident victims receive the compensation they’re entitled to, regardless of the circumstances. Find out if you have a claim by filling in the contact form or calling 855-LAW-NINJA. You won’t pay fees until we win.
