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Whether your buddy needs to borrow your pick-up truck to move his couch or your daughter wants to drive your car to her college class twice a week, it’s not uncommon to want to lend your vehicle to another driver from time to time. But what happens if the person you lend your vehicle to gets into a collision? And how many times can you lend your vehicle to someone before they need to be added as an occasional driver on your car insurance policy? We’ve got answers to your questions.

Will my insurance policy still cover damage to my car if someone else is driving?

Generally speaking, your own insurance policy should cover damage to your vehicle even when someone else is driving it, as long the driver:

  • Is licensed to drive in Canada
  • Has your permission (verbal or written) to drive your vehicle
  • Sticks to the rules outlined in your policy (e.g., if your policy covers personal use, your cousin can’t borrow your car for his pizza delivery gig)
  • Doesn’t participate in illegal activities while using your vehicle (e.g., street racing or drinking and driving)

Review your policy documents or contact your licensed broker if you have questions about the specific rules outlined by your own insurance company.

If I lend my car to another driver and they get into a collision, will it affect my car insurance coverage?

One of the most common myths about car insurance goes something like this: “If my friend borrows my car and gets into a collision, it won’t affect my insurance record.” Unfortunately, this is false. If you give your friend permission to borrow your vehicle and she gets into an accident, your own insurance company will probably need to pick up the tab — and the claim will likely remain in your file, which could affect your premium or other aspects of your coverage.  

Think of it this way: If you’re trusting someone to borrow your vehicle, you’re also trusting them to borrow your insurance policy. Consider asking a few questions about what they’re using your vehicle for and where they’ll be going. If you’re not confident in someone’s driving skills or that they’ll follow the rules in your insurance policy, you might want to reconsider lending them your vehicle.

When does someone need to be added as an occasional driver on my car insurance policy?

While every insurance company has its own set of requirements that specify when you need to identify someone as an occasional driver on your car insurance policy, here’s the general rule of thumb: Generally speaking, if you know that someone asks to borrow your car on a regular basis (once or twice a week, for example), they should likely be added as an occasional driver on your car insurance policy. But if someone rarely asks to borrow your car (less than once a month, for example), it may not be necessary to add them to your policy.

Here’s one standard exception to this rule of thumb: If the driver who wants to use your car only has their learner’s permit and is driving under the required supervision, they generally don’t need to be added as an occasional driver, no matter how often they will be driving your vehicle. While this is true in most locations, there are exceptions — so, no matter where you live, you’ll need to let your insurance company know that a new driver will be practicing in your car just in case.

Before you lend your car to another driver, it’s best to reach out to your licensed insurance broker to find out if they need to be named in your policy before they get behind the wheel.

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