Question about auto insurance between multiple owners for the same car.

[PandaBear]

Let's say you have one vehicle you want to own between you and your adult family member (brother, sister, dad, mom, in-law, etc). It is not an expensive vehicle (say $10k) nor with sentimental value, you just don't use it all the time and neither person want to own it 100% and have to lend to another person (i.e. a pick up truck or a moving van).

You don't mind sharing ownership and let one person use it more than the other, but you are worried that the other owner may get in trouble, sued, and max out your insurance even if you buy the best liability coverage.

Is there a way to structure the ownership and insurance so that the buck stop with the driver and part owner but not the other non driver owner? I don't think liability (or was it liability + umbrella) coverage go above 1.5M these days but say you want to cover the worst case of 5M, what would you do?

 

[Hall]

I'm not aware how non-spouses can co-own a vehicle, at least not in my state. By "owning", I mean the name on the title as that's all the insurance company cares about as well. If the co-ownership is just an oral agreement, the insurance doesn't care. As I continued reading, wow, this is so hypothetical, I doubt anyone can give a correct answer.

 

[Nukeman7]

I would suspect that an insurance policy would be written for the higher risk owner and garaging location. The other, lower risk co-owner would be covered on the policy as a secondary operator of the vehicle, similar to a spouse or non-married "partner". All speculation on my part, but I'm sure it is not that uncommon in today's environment.

 

[eljefino]

Have the high-risk driver get SR-22 insurance that covers them in any car they drive.

 

[Rand]

If you are worried about millions, dont do it. have separate 10k cars

 

[skyactiv]

I'm pretty sure a policy can be written for each co-owner but be sure he/she isn't listed as an additional driver on your policy.

To note, my dad had his own law practice and did a pre litigation discovery on auto accidents. He had a few series cases go to court like when a man had to get a spinal fusion after a bad accident. He's bleeding with money in his retirement to the point my parents give my 4 siblings and I the max allowed tax free gift every year.

 

[CKN]

In the event of an at fault accident-they will sue everybody on the registration. Something to think about.

 

[alarmguy]

Let's say you have one vehicle you want to own between you and your adult family member (brother, sister, dad, mom, in-law, etc). It is not an expensive vehicle (say $10k) nor with sentimental value, you just don't use it all the time and neither person want to own it 100% and have to lend to another person (i.e. a pick up truck or a moving van).

You don't mind sharing ownership and let one person use it more than the other, but you are worried that the other owner may get in trouble, sued, and max out your insurance even if you buy the best liability coverage.

Is there a way to structure the ownership and insurance so that the buck stop with the driver and part owner but not the other non driver owner? I don't think liability (or was it liability + umbrella) coverage go above 1.5M these days but say you want to cover the worst case of 5M, what would you do?

I dont see how ownership liability can be divided on joint owned property. But all states can be different and definitely a question for a attorney licensed on your state. Would love to know the result.

 

[JeffKeryk]

Call your agent.

 

[PandaBear]

In the event of an at fault accident-they will sue everybody on the registration. Something to think about.

This is what I try to avoid. I don't mind small claims or even totaling the car.

What I want to see is if it is possible to register the car as corporate ownership then lease usage right to each owner, like a limited liability company owned car that do business with individual owners. However since it is not an arm length transaction I'm not sure how will this work.

 

[PandaBear]

https://www.avvo.com/legal-answers/in-california-i-am-an-insured-co-owner-of-a-car-on-1119519.html

https://plaintiffmagazine.com/recent-issues/item/proving-implied-permission

So it seems like co-owner is only liable for up to 30k?

 

[CKN]

https://www.avvo.com/legal-answers/in-california-i-am-an-insured-co-owner-of-a-car-on-1119519.html

https://plaintiffmagazine.com/recent-issues/item/proving-implied-permission

So it seems like co-owner is only liable for up to 30k?

Why would you want to be liable for any amount? It really sounds like you are trying to get around insurance requirements for the other drivers.

 

[JHZR2]

If you’re worth enough to be worried about a $5MM liability, forget the shared vehicle. You’re well enough off to buy a second vehicle and gift the insurance cost for the other person under the IRS cap.

 

[CarLuver]

my expereince is that the insurance is the person the car and address is registered at. So you have your mom and you as legal owner on the title. the registration is in both names, but it reg at your address. that is where they expect the vehicle to reside. Now if your mom lives with you and has ready access to vehicles , she would have to buy insurance also . but if she does not live with you and jsut borrows it every once in a while , your insurance will cover her use as insurance goes with the vehicle.

i would just get a high umbrella policy . i have seen them up to 5 mil and i would guess they go even higher . buy enough insurance to cover all your assets

 

[97prizm]

Let's say you have one vehicle you want to own between you and your adult family member (brother, sister, dad, mom, in-law, etc). It is not an expensive vehicle (say $10k) nor with sentimental value, you just don't use it all the time and neither person want to own it 100% and have to lend to another person (i.e. a pick up truck or a moving van).

You don't mind sharing ownership and let one person use it more than the other, but you are worried that the other owner may get in trouble, sued, and max out your insurance even if you buy the best liability coverage.

Is there a way to structure the ownership and insurance so that the buck stop with the driver and part owner but not the other non driver owner? I don't think liability (or was it liability + umbrella) coverage go above 1.5M these days but say you want to cover the worst case of 5M, what would you do?

Depending on the state and your insurance company one person will likely have to be the primary owner or driver. Then add insurance based on others wanting to use the vehicle. I'm not sure but that sounds like you may have to go a specialty insurance route.

 

[PandaBear]

my expereince is that the insurance is the person the car and address is registered at. So you have your mom and you as legal owner on the title. the registration is in both names, but it reg at your address. that is where they expect the vehicle to reside. Now if your mom lives with you and has ready access to vehicles , she would have to buy insurance also . but if she does not live with you and jsut borrows it every once in a while , your insurance will cover her use as insurance goes with the vehicle.

i would just get a high umbrella policy . i have seen them up to 5 mil and i would guess they go even higher . buy enough insurance to cover all your assets

This is basically the situation. You live with your family but you are both grown adult with high networth. Sure you can duplicate the vehicles say 2 vans or 2 pick up so you don't have to share for liability, but then you need to deal with parking space and all that inconvenience.

I am sure these days 5M is not a huge assets that people are too worried about, just wondering how most people handle it other than umbrella and maxed out liability.

 

[PandaBear]

Why would you want to be liable for any amount? It really sounds like you are trying to get around insurance requirements for the other drivers.

It is not that I want to be liable for any amount, it is because having 4 cars in 1 house in an urban area is pain in the butt.

 

[mk378]

Actual rich people technically don't own the cars, boats, airplanes etc that they use. They set up a shell company that buys the car and holds the title. That company can simply go bankrupt and disappear if any major liability occurs. They also use borrowed money even though they don't have to. The payments from the rich person to the shell company to cover the loan payments are tax deductible.