Can someone else insure my car so I can save money on premiums?

People are always looking for ways to save money on auto insurance.  Especially in states like Minnesota that require No-Fault coverage, people are always trying to find a way to avoid the high cost of coverage.  We have had several clients over the years who have done some variation on the above.  They have asked some other family member (or friend) to insure their vehicle.  It seems like a good idea…until you’re involved in a crash and need to obtain benefits.

When a person seeks benefits through their insurer, the first step that is required is showing that they are entitled to coverage.  In the case of auto insurance, there is always extra scrutiny whenever the address of the driver seeking benefits is different from the address that the insurance company has on file.  Usually, they will ask for a statement about where the car is actually garaged, who has access to it, etc.  If it comes out that the vehicle is not garaged where it says in the insurance company files, and that the primary driver does not live at that address, benefits are often denied.  In those cases, the driver has to find another way to pay his medical bills.  Often, this means that money that should have gone to the injured person for pain and suffering ends up going to pay their doctors instead.  The client walks away with little or nothing in their pocket to compensate them for everything they’ve gone through.

We have also seen situations where the insurer begins making payments, only to discover that the claimant has engaged in this type of conduct.  The insurer in that case often has the right to get their money back directly from the claimant.  Along with getting their money back, there is also the possibility of a fraud investigation that can even lead to criminal charges.  While those types of cases are relatively rare, they are a risk.

It’s even worse if you’re at fault for the collision.  You might seek protection from your insurance for the pain and suffering you caused to someone else.  Insurance companies don’t make billions by paying out claims – they will try to see if there is a way around providing coverage.  If they can show that you cheated the system, they can attempt to deny coverage.  If that happens, you may be on the hook for thousands of dollars to compensate the victims of the crash.

Bottom line – while it might seem like a good idea to have your friend/cousin/sibling pretend to own and insure your car for cheaper rates, you may end up having paid for nothing, or worse. We always encourage properly insuring your vehicle. If you have been injured in a car crash or have questions about coverage, contact Walther Goss Law today.

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