Accident With a Borrowed Car:  Whose policy pays?

If you loan your car to a friend and your friend has an accident, it's your insurance that's on the hook.  "The insurance follows the car" is the general rule of thumb.

Might there be circumstances where the borrower's insurance would become involved?

Yes.  Suppose you borrow a friend's car and have a serious accident.  If your friend's (the owner's) coverage (called the primary coverage) is used up, then your own coverage (the secondary coverage) would step in.  Or suppose you borrow your friend's car, have an accident, and then find out your friend did not have insurance in force on the car.  Then your insurance may step in and become the primary coverage.

All these rules go out the window in many cases if the person whose car you borrow happens to be a relative who resides in your household.  Remember these two things: First, always exercise caution when it comes to lending your car.  Second, if you're ever in doubt about whether you or another driver is covered in any given situation, please call us.

If you have collision and comprehensive ("other than collision") coverages on your own car, you are most likely covered if you're traveling in the United States, its territories and possessions or Canada (for example, travel in Mexico, the Bahamas or Europe would not be covered).  Most policies (except business policies) cover any rental car that you drive at no additional premium.  Business cars frequently require an extra premium to afford the same coverage.  Give us a call before you leave for your "fun in the sun and/or snow" to confirm your coverage.

What to do after an accident?

You've been in an accident.  Here are some general guidelines about what to do next.

Stop at once:  Never leave the scene of even a MINOR accident

Seek medical assistance and summon police.

Do not admit fault: Do not comment about the accident to anyone but your insurance representative and the police.  Never accept or make an offer of cash, check or "private" settlement.

Gather accident information:

• Note the date and time of the accident.
• Obtain information on the other driver including: name, address, phone#, make of car, vehicle license# and insurance company.
• Record a decription of what occurred.
• Draw a diagram of the accident showing the direction of both cars and the point of the accident.  Include street names and location of traffic signs/signals.

Report the accident promptly to your insurance agent.

Cellular Phone Coverage

Since many of us now have cellular telephones, we thought it might be worthwhile to highlight a few points regarding how insurance applies to this technology.

If a cellular phone is stolen from your car (or along with your car if it is stolen), is it covered by your auto insurance?
No, unless the phone is permanently installed and powered by the car's electrical system.

Is your portable cell phone covered by your homeowners or renters insurance?
Sometimes, subject to the policy provisions and deductible in your homeowners or renters policy.

Can you buy broader coverage for your portable cell phone?
Yes, most companies offer a special, broader coverage for portable cell phones that can be added to a homeowners or renters policy.  Call us ea for details.

What if you lease a portable cell phone?
If you lease a phone, check with the company you lease the phone from to see what (if any) coverage they may provide.  You may then want to check with us to compare coverages and cost.

If you are thinking about leasing or buying a car, you might consider adding Lease Loan Gap Coverage to your auto policy.  LLG Coverage is an extension of your auto's physical damage coverage.

Ordinarily, your comprehensive and collision coverages provide you with up to the actual cash value (the vehicle's cost minus depreciation) in the event of a total loss.  When you sign a lease or loan agreement, you may be obligating yourself for an amount higher than the vehicle's actual cash value.

At a cost of approximately 5% of your current comprehensive and collision premiums, LLG Coverage protects you from the out-of-pocket expense when such a "gap" occurs.  Although there are some limitations, LLG Coverage will pay up to your lease or loan amount if your car is stolen or if the cost of repairs is greater than its salvage value. Contact our office and we'd be happy to discuss this coverage further.

Note: Some car manufacturers may provide gap coverage as part of the lease agreement --- check your particular contract for details.