You’ve probably let a friend or relative borrow your car before (maybe even an acquaintance). And you ’ve also borrowed someone else’s car to haul a big load or run out to the store quickly.
Lending your car to a friend or relative is so common that it might not seem like a big deal, but it can have serious legal consequences that you may not have considered.
Your Car, Your Insurance, Your Liability
When you lend someone your car you’re not just giving them the vehicle itself, you’re also effectively letting them borrow your insurance policy. That’s because your insurance policy is tied not to you, but to your vehicle. So if the person who has borrowed your car gets into an accident then any claims will be made against your insurance.
While your insurance is tied to your vehicle, your insurance premiums are a reflection of your own driving record. Generally the better your record, the lower your premiums. Any claims against your insurance could cause your premiums to rise.
What could be worse than higher insurance premiums? In some cases, your insurance won’t cover the cost of the claim(s). This usually happens when the driver who borrowed the vehicle was driving under the influence, had a suspended licence or violated the terms of your insurance policy.
It is your responsibility to ensure that the person driving your vehicle is legally allowed to do so before you lend them your car.
In Ontario, if a person is caught driving with a licence that has been suspended due to certain Criminal Code violations (including driving under the influence) then the vehicle that they are driving is impounded for 45 days. If their licence was suspended for a traffic offence then the vehicle will be impounded for seven days. That means, as the vehicle owner, you’d be required to cover the costs associated with impounding your vehicle.
How to Protect Yourself
The simplest way to protect yourself from the liability associated with lending your car is to not let anyone borrow it! Saying no can be hard, but sometimes it is necessary. If you insist on lending your vehicle then there are some steps you can take to protect yourself:
- Register regular drivers: You can register regular drivers with your insurance company. This might mean that your premiums will increase, but this is better than not disclosing the information at all – which could potentially void your policy.
- Check their licence: Make sure that the person borrowing your car has an up-to-date driver’s licence that is not suspended. You could ask to see it in person and also check their licence online with the Ministry of Transportation for a $2 fee.
- Make sure your vehicle is fit for the road: Ensure that your insurance is up to date and that your car is in full working order (you might also want to check for any dents or scratches before lending your car).
Personal Injury Lawyer
Even with these precautions, you could still find yourself in a difficult legal position as a result of letting someone borrow your car. Contact Zayouna Law and speak to an experienced team of personal injury lawyers to help guide you through car accident liability. Call us at 1-866-929-6862 for a FREE consultation!