Are you liable if a third party has an accident in your car?

Answer 1

This question causes more arguments between policy holders and insureds than you'd believe. But, yes, your insurance would cover it. Except for some weird instances, the insurance follows the car. If your daughter's boyfriend has permission to drive the car, he typically becomes an insured driver under your policy. And, once he's gotten permission to drive the car once, your insurance is probably on the line for any future times he drives it (unless you're willing to press charges against him for stealing the vehicle). Incidentally, his insurance would be considered secondary or excess (for instance, he hits another vehicle while driving your car, seriously injures the other driver, and the bodily injury exhausts your policy limits. His insurance would then step in -- usually -- to pick up the slack, but they wouldn't be primary).

In my personal experience in California: I loaned a truck to a "friend", he had an accident returning to my home. My insurance paid, and tried to go after the driver's insurance. Turns out he was uninsured. So they added him to my policy for three years and raised my rates 83% (to $1600 a year). They say I can't remove him from my insurance for three years. They paid out $2600 and after three years they will profit $2200.