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Know Before You Loan: Important Facts About Lending a Vehicle

October 18, 2011

Lending a vehicle is a helpful and friendly thing to do, and in most cases perfectly safe. However, many drivers are unaware of their responsibility level when someone else is behind the wheel of their car. InsuranceHotline.com reminds drivers that lending a vehicle might just be a bigger favour than they anticipated. Here are some tips to keep in mind before lending to avoid potential consequences and to be certain that the person borrowing the car can be fully trusted.

When a friend or family member asks to borrow the car, most people do not hesitate to hand over the keys. There is no reason why a driver should not agree to lend the car as long as they are well aware of the responsibility they are taking on. InsuranceHotline.com not only wants to remind drivers of the consequences, but the person borrowing the car needs to be aware of the serious responsibility they are receiving and ensure they take their accountability seriously.

The Insurance Follows the Car

When it comes to lending a car, it is the insurance policy taken out by the owner of the car that will handle any incidents that might occur. Even if the borrower has their own insurance policy on another vehicle, that does not negate the fact that the primary policy responsible may be that of the owner. If there is an accident, it may be the owner’s insurance and not the driver’s that will handle the claim.

This means that if someone borrows a car and is involved in an accident through their negligence (meaning they are at fault), it may cost the owner of the car in the form of a deductible and/or increased insurance rates. The insurance policy on the car may be responsible for paying out on liability claims. It will also be the owner’s insurance that might pay for damage to the car itself through their coverage, even if the borrower has their own liability coverage.

Because of this, the rate increase for the accident may appear on the owner’s insurance and not on the driver’s insurance. “The owner bears the responsibility for everything that happens with their car, even if they are not present.” Tammy Ezer of InsuranceHoteline.com reminds drivers. It is vital to be certain the person driving is trustworthy and responsible.

A Car Lending Checklist

Before the keys are handed over check a few simple things to ensure that everything is in place and that there are no legal issues.

  • Ensure that the person borrowing the car has a valid driver’s license. This may seem obvious, but it is vitally important.
  • Make certain a copy of the registration and proof of insurance are in the car and let the borrower know where to find them.
  • Verify that both parties are agreed on how the car can be used and where it is being driven.
  • Ensure the borrower knows not to let anyone else drive the car.
  • Check the odometer before lending the car. Even if the driver is a trusted friend or relative, it can’t hurt to know. Extra kilometers on the odometer will make it clear if the agreed usage for the car is being exceeded.
  • Make certain all signals, brake lights and other important functions of the car are in good working order.

With an understanding of what it really means to lend out a car, it becomes clear that it is important to be choosy when making this type of decision. Drivers who are trustworthy and have a proven track record of clean driving are good choices – steer clear of lending to anyone who might be irresponsible as this could affect your auto insurance rates in the future.

  • http://www.insurancehotline.com/ InsuranceHotline.com


    It depends on where you live. Check with the ministry of transportation in your province.


  • http://www.insurancehotline.com/ InsuranceHotline.com


    Yes. If you are just visiting, you will be covered under your parents Ontario auto policy.

  • http://www.insurancehotline.com/ InsuranceHotline.com


    In Ontario, you can lend your car to anyone with a full licence. Remember, if they get into an accident and it is their fault-you may see an increase in you your insurance.

  • http://www.insurancehotline.com/ InsuranceHotline.com


    Depending on where you live, you might be able to sue in small claims court.

  • http://www.insurancehotline.com/ InsuranceHotline.com


    if you had your father’s permission to use the vehicle, then you would be covered under his policy.
    but your father’s insurance would likely increase if you were to be involved in an at fault accident.

  • http://www.insurancehotline.com/ InsuranceHotline.com

    Most Canadian car insurance policies will cover for the continental USA also.
    Double check with your province to be sure.

  • http://www.insurancehotline.com/ InsuranceHotline.com


    If they are no longer at home and rarely use the car, you can remove them. they will still be covered on the occasion that they use it.

  • Para

    I have a incorporated small business in Ontario
    and the business owns a car. In other words, the car is registered under the
    business. I have a personal insurance for that car. My question is if I can
    lend this car to an extended family member to cross the border?

  • http://www.insurancehotline.com/ InsuranceHotline.com

    your insurance policy will cover someone who drives the vehicle with your permission.

  • Kim

    My daughter has auto insurance under her fathers policy. If I allow her to drive my company vehicle will she be insured if something happens? She lives with her father.

  • http://www.insurancehotline.com/ InsuranceHotline.com

    you should double check with your company to see if their insurance will cover her.

  • Concerned Parent

    My daughter, age 27, just got her G2, and doesn’t live with me, she borrows my car…does my insurance cover her.

  • guest

    If I borrow my parents’ car sometimes but do not live with them and am not listed on their policy, does their insurance cover if anything should happen? I do not have my own policy but I have a valid G2

  • guest

    Hi, if i’m stop by a law enforcement how much would be the fine? i drive my friend’s car it has auto insurance, but i’m not insured.
    Will it affect if my insurance in the future?

  • guest

    A friend of the family who has an australian drivers licence would like to borrow our car to drive to the USA is this allowed?

  • ruddi

    I am giving my car to my daughter age 27 and she will insure the car under her name as primary driver. Will I be liable if she gets an accident or tickets. Is it going to affect my own insurance

  • Zigglesworth

    The vehicle will have to be in her name for her to get primary insurance
    You can sign it over as a gift (if in ontario anyway) after this in the event of an accident it will not effect your rates whatsoever
    However if she is occasional on your policy and you leave the car in your name your rates can and likely will be effected in the event of a collision
    But again the primary driver on a policy must also be the vehicles owner

  • Zigglesworth

    The vehicle will have to be in her name for her to get primary insurance
    You can sign it over as a gift (if in ontario anyway) after this in the event of an accident it will not effect your rates whatsoever
    However if she is occasional on your policy and you leave the car in your name your rates can and likely will be effected in the event of a collision
    But again the primary driver on a policy must also be the vehicles owner
    Tickets only effect the driver and follow them for 3 years

  • Zigglesworth

    Depending where you are policies are different
    In Ontario as long as the vehicle is insured you can drive it without your own insurance
    In the event of being pulled over simply show them the ownership a be insurance from the glovebox
    If your friend doesn’t have insurance you would be liable for all the fines ($5000).so make sure it does before you drive

    Also if your in an accident it’s still covered by the owner of the car will be comptely liable and it will also hit there record with an accident which will follow them not you for 6 years

    tickets received by you (speeding etc) will only follow you and not effect there rates

    In ontario the car is insured not the person (in the simpest terms its always more complex than that tho )

  • Concerned Mom

    My son has his own insurance and is leaving for Military leave for a month. He would like to let his cousin who is a brand new driver have the car while he is gone. Is the cousin covered under my son’ insurance automatically or does he need to put on policy?

  • Sheila Annette Pirson

    my son in law wants to use my car as he just got his G1, but i have had trouble with 2 accidents where other people drove my car, what is my responsibilty, and is the G1 valid?

  • alycia

    If my mom gives me her car and I register it and insured it under my name, is she responsible if I get into a car accident? I live in New Jersey.

  • http://moonfroth.hubpages.com Clark Cook

    I’m visiting friends in California. Does my BC car insurance cover an American driving my car in California?

  • mikeIH

    best to check with your insurance company for that. In Canada ‘you lend your car, you lend your insurance as well’.

  • Concerned wife

    My husband had his Ontario driver’s license suspended for a DUI. Now that he has his license reinstated, it’s too costly to insure him on our car insurance policy. Can he still drive someone else’s car occasionally?

  • curious

    what if you lend your car to someone who has suspended licence but you were not aware of that? will your insurance extend to that person if they have a loss?

  • Chris

    if a car is loaned with permission to someone with a suspended licence for unpaid fines, but the loaner/owner did not know the person had a suspended licence will the owners policy respond, if there is a loss?

  • InsuranceHotline

    The insurance company may not pay the claim since it is the policyholder’s responsibility to make sure that the person that they lend their car to has a valid licence.

  • Suzy

    not true. I am the principle driver of a vehicle that my boyfriend, now fiancee owns. The ownership is in his name. The insurance policy is in his name. However, -I- am listed as the principle driver on the insurance policy; the discounts on the rate for that vehicle are affected by -my- licence level (G2 now going into G) and my drivers education (which i did not recieve).

    Call your insurance company. They’ll let you know how to have her covered. You can loan the car to her on occasion, which won’t affect the rates.

    If you and her are essentially splitting the use of the car, you should get her listed as an occasional driver. If not, the insurance company may give you a hassle to cover any claims if she gets into an accident because you didnt mention that someone else would be driving the car on a regular basis. This may impact your rates due to her younger age, and less experience, lower licence level etc.

    If she does the majority of the driving in the vehicle, you should make her the principle driver and yourself the occasional driver. The rates will 90% likely be affected. She can make a claim herself if she gets in an accident, and there is no hassle. It’s like being the owner of the vehicle, but not.

  • Suzy
  • Stephanie Belair

    Is it okay to drive my boyfriends vehicle when I have no insurance but a valid G license and I am over 25? He has insurance on that vehicle.

  • InsuranceHotline

    As long as you have a valid licence, have permission and you are not excluded on his policy then you will be covered.

  • Terry

    What if my son is 24? Can he drive occasionally?

  • Terry

    Wow the last post was a year ago

  • Sheryl

    If I borrow my friends car and am involved in An accident. The fault is deemed the other driver. Who’s insurance company do I contact about getting my friends car fixed. Mine, my friends or the other driver that’s at fault?

  • InsuranceHotline

    Which province is the vehicle insured in? that makes a difference. If the vehicle is insurance in Ontario your friend would go to their own insurance company. In Alberta it would be the other driver’s insurance who would pay.

  • Xperia Tee

    Hi, If i own a car in ontario and pay insurance on it, my brother is the secondary user on the insurance, but i have moved provinces and have a saskatchewan license now. Can he still use the car considering i am paying insurance on the car? is he still covered since i am still making insurance payments even though i am out of the province?

  • InsuranceHotline

    yes. but your brother should be made to be the primary driver since you are out of the province.

  • Jay

    I live in Toronto, Ontario and my friend wants to borrow my car for a road trip to another province. Will my car be covered under my insurance policy if if I lend it to him and I’m not with him?

  • InsuranceHotline

    Once you have given your permission, your insurance will cover any driver. Keep in mind though if that driver gets into an at fault accident with your vehicle then your rates will increase.

  • nishanirajkumar@gmail.com

    my brother own the car but i am the principal driver and insurance on my name if my brother got accident the same car that not own by me but i am the principle driver did my licence effect

  • InsuranceHotline

    In Canada the insurance policy must be in the name of the registered owner of the vehicle. Your brother can be the named insured and you can still be the principal driver.
    Any at fault accidents that happen when the vehicle is being driven will go against the owner of the vehicle.

  • Adam Lodge

    Hi i have a UK driving licence and am currently living in Whistler BC. I am driving to Jasper and back next week and my friend has said i can borrow his car to do this. His car is insured. Would be having a licence not from Canada effect me in being able to use his car?

  • Mellissa

    I’m the principal driver of a vehicle that I don’t drive would that effect my insurance if it got into an accident?

  • mik sagum

    would i be covered for the insurance if i drove my father’s car and got into accident . i kive in montral , quebec

  • InsuranceHotline

    You will likely be covered if you have a valid drivers licence and your father’s permission to drive.

  • Melo Berval

    Need info please. First of all, my car is plated Qc and its insured but cops dont see car insurance from qc in their computers. A friend was driving my car, got pulled over, and he got a ticket for driving without car insurance because he didnt found the insurance papers. My car was impouded. BUT my car is insured . i have proof of that sent by my insurance compagny. So if i want my car back, i have to pay the towing and impoudment fees.
    I cannot dispute the ticket because its not on my name.

    What can i do ?

  • wondering girlfriend

    If i am a g2 driver in ontario with no vehicle or insurance am i allowed to drive my boyfriends vehicle who has insurance?

  • Susan Regular

    is there any such thing that can be written into your car insurance policy that limits certain age groups from being insured should they get involved in an accident?

  • Deb Steve Oram

    If I am from BC, am I insured to drive a vehicle in Quebec?

  • Taylor

    I lent my car to a friend, and she side swiped someone. I am the principle driver on the car, but the car itself is owned and insured under my parent’s names and insurance. I know the accident goes with the car. Will the accident go under my insurance as the principle driver, or my parents insurance as the owner of the car and which the car is insured under?

  • Dover Jasmine

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  • Marina Stewart

    My son had a 30 day suspension on a G1 he had to sign a waiver not to drive my car my insurance wouldn’t cover him anymore. Now he is driving a friends car once and awhile. Is he covered under her car insurance if something happens?

  • InsuranceHotline

    if your daughter will be the primary driver of the vehicle then the insurance company should be made aware.
    your premium will likely increase as the company will rate your policy for your daughter as the primary driver.

  • Frank Lagundzin

    I have a newborn child 7 months old with my ex girlfriend I left her my van so she can get around for groceries or doctors appointment which she is not on the ownership or my insurance she doesn’t have coverage of her own but is a fully licensed driver just curious what will happen if ever she gets into and accodent

  • InsuranceHotline

    Most of the time if you give permission for someone to drive your vehicle, that person will be covered for the coverage that you have on your policy.

  • InsuranceHotline

    The ticket should only affect your insurance as it forms part of your driving history.

  • InsuranceHotline

    In Ontario if you give someone permission to drive your vehicle then they would be covered by your policy.
    Check you auto policy wording. It will state who is covered to drive your vehicle.

  • InsuranceHotline

    If he lives with you then he should be added to your policy. If he doesn’t live with you and only lend him your car occasionally then he doesn’t need to be added. Keep in mind that if your grandson has an accident that is considered to be his fault then you could see an increase in your insurance as a result of that.

  • Josef Izchaki

    Thank you so much for the quick response!

  • Kenny Parker

    I was just wondering about lending a car you have October 2011 it says the owner is liable for everything basically does that still stand in 2017

  • InsuranceHotline

    Yes. If you lend your car, any damage caused by your vehicle when another person is driving will be paid under your auto insurance policy as the owner of the vehicle.

  • InsuranceHotline

    You should check the law and polices in the province that you are insured in. In Ontario drivers are often not compensated for “pain and suffering”

  • InsuranceHotline

    I don’t know of any restriction that states they must be over 25. If she has the owner of the vehicle’s permission to driver the vehicle then she will be covered under the owner of the vehicle’s policy. Your daughter should remember that if she gets into an at fault accident while driving her friend’s car, then her friend may see an increase in her insurance rate.

  • InsuranceHotline

    The other driver might just have given you an old slip. It doesn’t mean that they have no insurance. In most provinces, if there is no damage then you do not need to call it in.

  • Sarah

    My bf is from Europe. His Ontario licence is expired is he still ok to drive a vechile legally in Ontario

  • InsuranceHotline

    He may need an international licence. You should check with your insurance company.

  • Ernest Finch

    my son borrowed my car for two months to go to work in SF and got about 4000 dollars of bridge toll violations against it and now i cant get it registered until its paid. what can i do to get the money from him to pay for it if anything.

  • InsuranceHotline

    Unfortunately, You might have to take him to court to get the payment.

  • INS101

    If by “cover her” you mean cover the damage to your vehicle if she is involved in a collision while borrowing your vehicle then, yes. The Ontario Insurance Policy covers the damage to your vehicle if you lend it out to your daughter or anyone with a valid drivers license, that has not violated the policy conditions for example using the vehicle for illegal purposes, and is not specifically excluded on your policy. You would be aware if someone was specifically excluded, as the policy holder and excluded driver need to sign the exclusion which in short states they’re both aware there is no insurance on the vehicle while it’s being operated by the excluded driver.

    Now if you meant cover her for injuries it’s no as cut and dry. They may cover her if she doesn’t have her own policy and is not listed on any other polices which may respond to her injuries.

    I hope this answers your question

  • Janet

    i live in ontario, i left my truck in b.c. and flew home – my nephew is driving the truck with my permission how does this affect my insurance
    i will travel back and forth to b.c. for visits and this way i have a vehicle to drive when in b.c.

  • InsuranceHotline

    you should let your insurance company know as most of them have a rule about insuring a vehicle that it out of province for six months or more.

  • Teresa

    Is there any way t make the driver reposnsible?

  • InsuranceHotline

    In Ontario each driver goes to their own insurance company for payment of damages. Your insurance company will likely pay for your damage however, they may require that you add your son onto your policy once they find out that he lives at home and has a driver’s licence.

  • https://www.facebook.com/app_scoped_user_id/100000609904839/ Larry Meade

    If I loan my car to a friend and he/she is charged with DUI, can my car be impounded?

  • InsuranceHotline

    It’s possible that the vehicle could be impounded. You might have to prove that it’s your vehicle but you were not driving in order to have the impound lifted.

  • InsuranceHotline

    Yes. Your Girlfriend can add you onto her policy however, she may not want to because her insurance rates may increase since you don’t have a full G licence. Plus if you get into an accident that is your fault, her insurance rates may be impacted.