Should I buy car insurance even though I don't own a car?
August 11, 2015 7:18 AM   Subscribe

I live in NYC and haven't owned a car for a number of years now. However, I still drive and am pretty risk averse, so I'm wondering if it would be worth it to get non-owner car insurance of some sort. 

As I said, I don't own a car anymore, but I do rent a car a couple of times a year for trips. Of course, when I rent, I have to buy the car rental place's insurance, which is jaw-droppingly expensive and, I'm assuming, a complete rip-off. I'm also a member of Zipcar, and they offer insurance as part of the membership, but the liability limits are really too low -- to my eye, anyway -- and I'd like to have extra coverage. (I use Zipcar fairly infrequently -- say five to seven times a year or so.) My driving record is 100% clean -- never even a speeding ticket.

I actually looked into getting non-owner's insurance, or whatever it's called (my 30-second Google research tells me there is such a thing). However, poking around the various insurance company websites wasn't terribly productive; they all asked for a VIN number and so on. 

So, concrete questions:

- If you've bought this type of insurance, would you recommend it?

- Will it be inexpensive enough to make it worth my while? As an example, when I recently rented a car for a week in NJ, the rental itself was a little over $200 inclusive, but the total tab came to well over $600 with the insurance. Obviously, if I have to pay $1500 a year for non-owner insurance, I might be wasting money, depending on my level of risk tolerance. (Note: as noted above, my risk tolerance is quite low.)

- Is there a particular insurance company that I should be looking at? 
posted by holborne to Travel & Transportation (14 answers total) 7 users marked this as a favorite
I would look into finding a credit card that gives you good car rental insurance and using that card for all car rentals.
posted by jeather at 7:22 AM on August 11, 2015 [4 favorites]

When I lived in NYC five years ago, I did this. My credit cards didn't provide insurance on rentals unless I already owned a car, and it was cheaper to pay for a non-owner's policy for an entire year than to buy the insurance from the rental agency once (I rented a car 2-3 times a year). It was great peace of mind, although I never needed to use it.

If I remember correctly, it cost about $150 and I found it through Geico, but it was actually serviced by Travelers. I had to call to get it, it wasn't available on the website.
posted by peanut_mcgillicuty at 7:26 AM on August 11, 2015 [2 favorites]

Almost all car insurance insures a car, not a person, so you are unlikely to be able to do this without dealing with a human being. You might want to call an independent insurance broker and let them find one for you, if you don't want to do the phonework yourself.

If you have homeowner's or renter's insurance (and you SHOULD have one or the other) you can often attach a rider to it for this sort of thing. Call whoever handles that, or if you don't have renter's insurance call an independent insurance broker and see what they can do for you for both items.
posted by Lyn Never at 7:35 AM on August 11, 2015

I've been told that if you live in a place like NYC and you sell your car you should never, ever completely cancel your insurance but rather switch to a non-owner policy because if you do wind up owning a car later on you will somehow magically be considered a new driver again and will have ridiculously expensive rates.

I was told this by an insurance agent so I'm pretty skeptical of that claim, though.
posted by Gev at 7:42 AM on August 11, 2015

It may also be worth talking to insurance agents about "umbrella" insurance riders. It's basically what it sounds like, a policy that kicks in for personal liability once other policies are exhausted (or if they're non-existent). I'm not sure how it would price out compared to a non-owner auto policy though.
posted by craven_morhead at 7:44 AM on August 11, 2015

Response by poster: I should have mentioned, btw: I did look into the insurance provided by my credit card for car rentals. Apparently, it provides only collision insurance but not liability insurance, i.e., it covers damage to vehicles but not personal injury to people. Of course, the latter is where you can run into really serious liability.
posted by holborne at 7:48 AM on August 11, 2015

I had a non-owner's policy for about two years while I was using rental cars a lot for work. Even when you are covered by a credit card, that usually doesn't give you much more than coverage for property damage. It was around $150 a year. Can't say much more about it, since I didn't get in any accidents.
posted by skewed at 8:05 AM on August 11, 2015

You may want to look into buying liability insurance for yourself. Some people have programs for this through work.
posted by zennie at 8:31 AM on August 11, 2015

I've got a $1,000,000 umbrella policy that covers a family of 4, including two younger drivers. I think it's about $20 a month, although there may be a discount involved as I have 4 cars and a house insured with State Farm.
posted by COD at 8:53 AM on August 11, 2015

I looked into this with Geico, and I believe the break-even point between paying the $13/day for extra liability insurance vs Geico's non-owner policy was about 20 days of renting per year. I ended up not purchasing the policy because there was an additional complication around car-sharing programs (zipcar in this case). In retrospect, I a little bit wish I had done it to drive other peoples' cars (please look into whether you are actually covered in these cases).

Last I checked zipcar's liability policy covers you up to $1M, and the supplemental liability of the rental car company I was looking into (Enterprise) was also $1M.

Either way, you still have to pay for damages to the car itself (or make sure your credit card will). If you are extremely risk adverse (ie $1M feels like way too little), you are going to have to first get the insurance policy and then purchase an umbrella policy, up to an amount you are comfortable with. At that point you will almost certainly get into complicated discussions about ZipCar, and I wish you best of luck.
posted by Phredward at 9:48 AM on August 11, 2015 [1 favorite]

I'm in the same position, and asked the agent I bought my homeowner’s policy through about non-owner policies. He referred me to I paid $94 for a year of coverage in Oregon and have rented cars a couple of times since buying the policy. I have little to report other than that they processed my credit card payment and sent me coverage info (I haven’t had to file a claim).
posted by Tentacle of Trust at 5:25 PM on August 11, 2015 [1 favorite]

Credit card insurance is worse than that. It only covers the rental car itself, with maybe one exception in the US. In most states (not California!), the car company must provide liability insurance to the state minimum. Fat lot of good that does you if you actually injure someone, but at least you are legal even if you don't have your own insurance.

For coverage of the rental car, you can't do better (other than the cost) than Amex's Premium Car Rental Protection. Depending on the coverage you choose, it covers the car far in excess of what most cards will cover and also covers things like passenger vans and pickup trucks that most cards exclude. I don't recall if it still provides personal injury coverage for the driver and passengers or not. It did at one time, but still doesn't cover liability to third parties.

It's nice not having to worry that I may have gotten too much of an upgrade and lack coverage. Anything under $100k is covered for up to 42 consecutive days on a given rental, so long as you pay for at least some amount of the rental with the car. Other card coverages limit you to 14ish days and require the full amount be paid on the card, going so far as to invalidate coverage for free day or dollar off coupons.
posted by wierdo at 9:25 PM on August 11, 2015

I just bought a nonowners policy from USAA after selling my car. It's $24/year.
posted by Wet Spot at 2:41 PM on August 13, 2015

Backing up Gev's claim above. I lived in NYC for two years without a car. When I moved away and bought a car, State Farm refused to offer me the insurance I had before I moved to NYC. My 10-year record of perfect driving was effectively erased and they would only refer me to a high-risk partner of theirs for "new" drivers. They told me I should have kept a non-owner policy in order to keep my driving record.

I ended up switching to Geico, because that is some serious gangster-level bullshit, if you ask me.
posted by soonertbone at 11:48 AM on August 20, 2015

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