Owning a car means that, on occasion, friends and family will ask if they can borrow it. You probably think that lending your car is better than lending money, but sometimes lending your car can be a bad idea!
There are several reasons why you might consider lending your car to loved ones: if their other vehicles are in for repairs, they have financial problems or even guilt for saying no to letting them borrow money, so you offer your car instead.
Our guide covers everything you need to know about lending your car to family and why short term car insurance is a great option.
A family member wants to borrow my car – what do I do?
Lending your car to a friend or family member comes with some risks. You’re probably doing them a favour, but you have to keep your finances in mind – especially regarding the vehicle’s maintenance and insurance.
Lending your car to family members
Most families have access to at least one vehicle. If your family has one or more vehicle, you need to think about how much it costs to pay for insurance, the overall upkeep, MOTs, and vehicle tax. Over time, this can prove to be quite expensive, especially if there is more than one car to run.
With more and more people working from home, it makes sense to have fewer cars in the family and to share a car. Of course, with multiple people using one car, there needs to be some organisation. You can use online calendars or calendar smartphone apps to set up a sharing schedule so that there is no confusion.
If you’re regularly lending your car to loved ones, you’re essentially part of a car share. You shouldn’t hesitate to ask the other drivers to help you with fuel, vehicle upkeep as well as contributing to your insurance.
Lending your car to your children
Many older children aged 20 to 30 are returning back to their parents’ houses. Renting or buying homes is expensive, and unless children are lent money from their parents, it is often unlikely that they’ll be able to afford their own place or car straight away.
Instead of offering to lend money to your children, you can make their lives easier by lending them your car. Children without transport will appreciate access to the family car for their independence, and it’s also a much more affordable and environmentally friendly option than purchasing their own vehicle.
However, parents need to consider the impact this could have on insurance policies. You’ll also need to consider how long your child might need access to the car – it could be for a few days while they’re home from university or more often.
There must also be some clear ground rules established, such as:
- How much they contribute to fuel
- A schedule for who uses the car and when they use it
- Contributions towards maintenance and servicing fees
If you lend your car to family or friends, you must consider the insurance implications. At GoShorty, you can get temporary car insurance, or if you have a young family member who’s learning to drive using your vehicle, you can get temporary learner driver insurance.
Most importantly, everyone is protected by insurance, even if it is not their car.
Who is covered by my car insurance?
Your car insurance will cover your car, the policyholder and any named drivers you add to the policy. You need to make sure anybody who drives the car is listed as a named driver.
Your insurance will only insure a driver who has your permission to use the car as a named driver. If someone takes the car without the owner’s permission, the insurance will not cover any accidents.
What happens if someone else causes an accident in my car?
If a named driver uses your car with your permission and gets into an accident, the insurance will cover the damage.
If your loved one did not cause the accident, then the other driver’s insurance will have to cover the costs of repairing your car. However, if your friend or family member did cause the accident, your insurance will have to cover your own repairs as well as those to the other vehicles involved.
If your friend who was driving has their own insurance, their coverage may supplement the payout to the other drivers involved.
The most important thing to remember is that there are different insurance policies with varying coverage, so you will have to check with your insurance company regarding what is covered by your policy.
FAQs about lending your car
Can I add drivers to my policy?
Someone who infrequently uses your car – for example, only a few times a year during visits – may not need to be added to your policy. Instead, you can consider using hourly, daily, weekly or monthly temporary car insurance to cover them when they use the car.
However, if you have a person who is regularly borrowing your car, then it is best to notify the insurance company so that everyone is properly protected.
Talk with your insurer to find out more about adding another driver to your policy and what you can do to protect yourself and your car when someone else is driving.
What happens if another driver commits a driving offence?
Let’s say someone borrowed your car and gets a speeding ticket or receives a fine for another driving offence. Of course, you should ask the borrower to pay the fines.
Luckily, tickets and fines follow the driver, not the car, which means that your friend’s insurance premiums may increase if they are considered high-risk, even when not driving their own car.
Consider temporary car insurance
Sharing a car with family or friends sometimes makes sense. Households with multiple people that have access to public transport probably don’t need more than one car. It’s also more affordable and environmentally friendly to share a car with friends and family.
One of the best ways to help out friends or family temporarily can be to lend them your car. If you do this, temporary car insurance is a great option. You can choose a policy that suits your needs, whether they need the car for a couple of hours or a couple of weeks.
Get a temporary car insurance quote today to find out more.