Borrowed Car Turns Out Not to Be Covered by Insurance

[ShannonO]

Trying to help someone out & need some input. Her son borrowed his dad's car (they are divorced) and got into a minor fender bender. Mom covers son on her insurance (Progressive) as son lives with her. No damage to the borrowed car and some minor damage to the other car that was hit. Dad's car is not available for regular use to the son. Turns out that dad does not carry auto insurance on the car. Progressive is denying liability coverage to pay for the minor repairs to the other vehicle since the vehicle the son was driving is not listed on the Progressive policy. I can find no exclusion in the Progressive policy - it says they will pay for damages for bodily injury (none, thankfully) & property damage for which an insured person (the son) becomes legally responsible because of an accident. The definition of an Insured is "you or a relative with respect to an accident arising out of ownership, maintenance or use of an auto or trailer." The son was using an auto and not in any of the ways that are excluded. Nowhere in the liability section does it say only coverage for driving a covered auto.

Any thoughts?

 

[moonlightandmargaritas]

Don't think it matters whether mom covers him or not. If I'm not mistaken, insurance goes with the car...not the driver.

 

[Theinsuranceguys]

It could vary by state, but in texas if an insured individual borrows a car the cars insurance is primary and anything the individual carries is excess coverage. I have had a situation similar to what you are describing with one of my standard carriers and it was a covered loss.

 

[broadway60]

Normally the insurance follows the car; not the driver. However wouldn't the borrowed car meet the definition of a temporary substitute vehicle? Are you in a mandatory insurance state?

 

[INSUREGEEK]

Of course Progressive isn't 'offering' to cover the claim! The owner of the car should have done what he was legally obligated to do, which is to have BI/PD Liability coverage at state minimum limits. Car first, driver second.

The other driver's insurance (if there was any) will have to actually pay for repairs, then go after Progressive for the amount they are due under the Progressive policy terms and conditions.

Is kiddo covered for the damages he caused? Probably. But Progressive will not pay it without a fight.

 

[DawnPatrol]

it's possible Progressive could pay. If the young man's own vehicle was possibly non-operational (due to mechanical issues, etc.), then the borrowed vehicle could be a "temporary substitute" vehicle and it would be covered (at least in CA)
But I'm only throwing out a possibility not knowing all the facts

In Ca most carriers will cover the vehicle under "permissive use" as long as it was a temporary usage and the driver has a valid drivers license.

 

[INSUREGEEK]

Just another thought. I see a lot of carriers these days either stalling indefinitely in accepting liability, or just flat-out refusing to accept it from day one. Some will even go see the wrecked car and write a repair estimate, then deny liability.

They'd rather wait for the subro papers - IF there are any - and do the whole splitting hairs thing on the back side. It also has to do with the fact that what they owe their own insured is pretty clearly spelled out in the policy......but they don't owe a claimant a darn thing. See where I'm going with that?

They are hoping there's no subro because the owner of the car their insured hit didn't have collision coverage. And if they do get a subro demand they have some pretty good info on what they might be willing to pay because they actually wrote their own estimate for repairs, got access to medical records of an injury, etc.

Good Luck! With Progressive, you're pretty much at the mercy of whomever is answering the phone that day. Stay after them!

 

[Milkman1265]

I think this is a case of the son being listed as an additional driver and not a named insured.

Only named insured coverage is extended to other cars (when named insured is driving) whereas additional driver is per scheduled vehicle.

So the son was only listed to be covered driving mom's vehicle not others.

 

[fjwinters]

The issue is he used dads vehicle. It sounds like they are giving you a conveluted denial. I do not know the contract, I would have to see it, but they should have given you a denial in writing. If not ask for one and request the exact reason based on the policy language as to why they are denying. Im assuming from what I read they denied collision coverage for the dads car?

 

[BigIVU]

I think this is a case of the son being listed as an additional driver and not a named insured.

Only named insured coverage is extended to other cars (when named insured is driving) whereas additional driver is per scheduled vehicle.

So the son was only listed to be covered driving mom's vehicle not others.

Most auto policies cover resident family members while using declared or nonowned autos. Insist on a claim denial in writing that cites the policy language that excludes coverage.