Whether you’re just starting your first year of college, you’re moving into your first apartment, or you’re thinking about renting out a room in your home, have you considered how your new roommates might affect your auto insurance? Regardless of if you’ve never met them before, or if you’ve been best friends since kindergarten, you should be thinking about how they fit into your car insurance policy.
Under Michigan law, you’re required to list all members of your household who could potentially drive your vehicle. There are some states that allow you to exclude members of your household if they’re guaranteed to never drive your vehicle ever, but Michigan is not one of those states. We’ll get to what that means for your policy in a bit, but first you should know the consequences of not listing your roommates on your auto insurance policy.
If your insurance finds out that someone who lives with you has been driving your vehicle, with your knowledge, they’re likely to increase the cost of your coverage. Usually, they find this out in the event of the accident, so the additional cost can go back all the way to the date of the accident, or even in some cases, to the date when you took out the policy.
But my roommate won’t be driving my car!
If you knew your roommate was going to be driving your car all the time, of course you’d put them on your policy, but you don’t plan on that happening too often. Even if you don’t plan on them driving your car at all, you should list them as an occasional driver. This will protect you in the event that they do drive your car and get into an accident.
How does listing your roommate affect your car insurance?
Depending on your roommate, listing them on your policy can either bring up your costs, or conversely your policy might not be affected at all. If your roommate has a stellar driving record, it’s likely that nothing will change, but if your roommate has a DUI or is under the age of 25, there is the potential for a higher rate.
What happens if my roommate gets into an accident in my car?
In the unfortunate event that your roommate has an accident in your car, the situation will determine what you have to pay and what coverage you receive.
- If your roommate had permission to drive your car and has insurance – Their coverage will kick in after yours has been exhausted. You will still have to pay the deductible, but the rest will be covered by your insurance and your roommates’ insurance.
- If your roommate didn’t have permission to drive your car but has insurance – Their coverage will pay for damages first.
- If your roommate had permission to drive your car and doesn’t have insurance – You will be responsible for any damages and medical fees. If they weren’t listed on your policy, you’re also likely to be liable for any injuries sustained by a third party in the accident.
- If your roommate didn’t have permission to drive your car and doesn’t have insurance – In a situation where your roommate didn’t have permission to drive, you’re essentially saying they stole your vehicle. This might make living with them difficult, but if it’s the honest truth, this is a legal problem to be dealt with.
The bottom line is that insurance companies want to provide you with coverage rates that are based on all drivers who will potentially be behind the wheel of your car. Even though adding a roommate to your insurance policy might seem tedious, and you might be afraid that it will cost more, it’s a good idea to at least talk to your insurance agent about your options. Adding a roommate to your auto insurance policy will provide you with extra coverage in the event that he or she does get into an accident in your vehicle.
Auto insurance policies are confusing. Every insurance company has their own policy, and it’s hard to know exactly what you should do, who should be on your policy, and how much you should reasonably expect to pay. Take the worry and guesswork out of it and call the reputable agents at Doyle & Ogden today! We guarantee to find you better coverage at the best price. You can talk to us at (616) 949-9000, or request a free quote online.
