You lend your car to a friend or a family member, trusting they will be responsible, just like how careful you are when driving a vehicle. But what if they are not as cautious as you are? What happens when they get involved in an accident while driving your car? Who is responsible for the damages? Will your insurance cover the costs? Are you liable for any injuries or losses? There are many questions to answer and so many consequences to deal with.
To help you navigate these situations, we delve into the intricacies of the aftermath that may follow when your car is being driven by someone else at the time of its accident. To ensure all the bases are covered, we will also shed light on relevant legal aspects, such as the Motor Vehicle Act, to help you deal with such accident cases with confidence.
Car Insurance Coverage: What happens when your car is driven by someone else?
In India, car insurance policies generally cover the vehicle rather than the driver. If your car is driven by someone else and is involved in an accident, the insurance coverage will still apply.
A typical car insurance policy provides financial protection against losses or damages to your four-wheeler. Similar to car insurance, bike insurance protects two-wheelers against various risks. In either case, when it concerns accidents involving someone else driving your vehicle, it comes down to two primary types of coverage:
Personal Damage Coverage: This type of coverage protects your vehicle against damages caused by accidents, theft, fire, or natural disasters. Regardless of who drove your car during the accident, personal damage coverage ensures that the repairs or replacements are covered, subject to the policy terms and conditions.
Third-Party Liability Coverage: Motor insurance also includes third-party liability coverage, which safeguards you against claims arising from damages or injuries caused to third parties by your vehicle.
Even in the case of a two-wheeler (such as a bike), if an accident occurs while someone else is riding it and it leads to injury or damage to a third party, your insurance policy will cover the liability as long as the rider has a valid license.
Suppose the cost of damages exceeds the coverage under your policy, the insurance cover of your friend (the one driving the car at the time of the accident) may be leveraged to cover the remaining losses. This means that the insurance of the driver who was behind the wheel when the accident happened may be added in to cover some cost, if the damages exceed your insurance coverage.
What is a ‘Named driver' clause in vehicle insurance?
Some insurance policies in India may have a "named driver" clause. This means the coverage is limited to specific drivers listed on the policy. If the person driving the car is not listed as a named driver, the insurance company may have the right to reject the claim or impose certain limitations.
If you frequently allow a few people to drive your car, it may be advisable to add their names to your policy. It ensures they are covered by your insurance in the event of an accident. However, note that adding additional named drivers may increase the premium.
Whose liability is it when an accident happens?
Remember, the Motor Vehicle Act lays down important legal obligations for vehicle owners and drivers. According to this Act, it is mandatory for all vehicles plying on Indian roads to have third-party liability coverage. As the owner, you are responsible to ensure that your vehicle is adequately insured.
Even if you have comprehensive insurance in place, you cannot claim any benefits if the person driving your vehicle does not have a valid driver's license. This is one of the salient requirements of the Act. Without it, you will not only be refused compensation for any damages but both you and the driver stand to face legal consequences in the event of an accident.
Irrespective of who is driving your car during the accident, the liability falls on the owner first. This means the insurance company will process the claim under your insurance policy. The driver's insurance, if any, may come into play only when your coverage has been exceeded.
What are some insurance coverage scenarios when someone else crashes your vehicle?
As a general rule, permissive use applies if someone else causes an accident while driving your vehicle. Only those with permission to drive your car or ride your bike will be covered.
Irrespective of permissive use or named driver clause, anyone driving under the influence of alcohol or without a valid driver's license will not be covered.
In case of accidents resulting in heavy damage and serious injuries, coverage may be limited to property damage only and not third-party injuries.
If the person you lent your vehicle to has insurance protection, it can be used to cover the cost of injury to the victim.
If your car or bike was stolen and an accident leads to third-party injuries, your insurance cover will have to foot the bill for property damage but not the injuries.
How to claim compensation for damages when someone else was driving your car?
To ensure a smooth claims process when your car is being driven by someone else at the time of an accident, it is essential to follow these steps:
Promptly inform your insurance company: Notify your insurance company as soon as possible about the accident. Provide accurate details about the incident, including the time, location, and other relevant information.
Gather necessary information: Collect all relevant documents related to the accident, such as the police report, photographs of the scene, and contact information of witnesses. These pieces of evidence will support your claim and help the insurance company assess the damages accurately.
Register a claim: Contact your insurance company and initiate the claims process. They will guide you through the necessary steps, documentation, and forms required to file the claim. Be prepared to provide information about the driver, their license details, and any other relevant information requested by the insurer.
Damage assessment and claims processing: The insurance company will evaluate the damages to your vehicle and process the claim if the accident falls under the coverage provided by your policy.
Conclusion
When your car or bike is being driven by someone else at the time of an accident, it is necessary to know the intricacies of motor insurance and legal obligations. Whether it is car insurance or bike insurance, comprehensive policies typically cover damages to your vehicle, irrespective of the driver. However, it is important to comply with the requirements of the Motor Vehicle Act and inform your insurance company promptly about the accident.
Be sure to review your policy details, especially regarding named drivers and any restrictions that may apply. Remember to consult your insurance provider for specific guidance tailored to your policy and circumstances.
