Auto Insurance Claims: car insurance

Question
Hello:

I live in CT.  My question is.....if my friend buys a car but is unable to get insurance because of his driving record and I get the policy in my name and list him as a driver and then he gets into an accident which is his fault, would I be held financially responsible or would he as the driver of the car?

Answer
Hi Paul,

Assuming you have a good driving record, this situation is a bad deal for you.

Insurance companies rate on risk.  If you can find a carrier that will insure him, it will impact you negatively both in terms of risk factors and in expense.  The premiums will be much higher, obviously.  You'd better make certain your friend is good for the money, or you - as the primary named insured will end up holding the bag so to speak.  This arrangement could also damage your personal risk rating.

And to answer your initial question.  You would be the policy holder. Of course liability would transfer to your policy if your friend, now a listed driver gets into an at fault accident.  Personal financial responsibility would kick in only if the damages caused by your friend exceeded your coverage.  Your insurance company would be required to cover you up to your limits. Sounds like you'd need high ones.  At the very least, you need to speak to a qualified insurance agent that you can trust.  I suspect they will tell you to steer clear of this mess.

My advice.  Stay away from this potentially very damaging situation.  Your friend got himself into this.  He needs to work independently to get out of it.

Regards,
Jane