You might not own a car, but that doesn’t necessarily mean you don’t need auto insurance.

If you don’t own a car, but drive frequently, you might need a “non-owners” auto insurance policy.  There are other situations, in which buying a “non-owners” policy is wise.

Case 1: Relatives and friends might be skittish about lending their vehicle to you, especially if their coverage is limited. Their policies might not cover drivers other than themselves, or perhaps their liability coverage is low. If you regularly drive a car belonging to a relative or friend, a “non-owners” policy could ease such concerns.

Case 2: Residents of big cities frequently don't own cars, yet many rent cars for vacations and other trips.  If you rent a car, you can purchase insurance offered by the rental company.  If you frequently rent cars, a “non-owners” policy might be more cost effective than relying on the insurance sold at rental counters.

You get what you pay for

Comprehensive, collision, towing reimbursement, and rental reimbursement coverages are not usually available for “non-owners” policies. There are generally no deductibles with “non-owners” auto insurance, unless your state requires uninsured/underinsured property damage coverage. (For an explanation of all these terms, see Auto insurance basics.)

When your “non-owners” coverage kicks in

Your “non-owners” auto insurance will cover you when you rent a vehicle and are involved in an accident in that vehicle.  If you borrow someone’s car and crash it, the vehicle owner’s insurance takes precedence over your “non-owners” coverage.

Your policy; however, would activate when the vehicle owner’s liability limits are exhausted. For instance, if the owner’s liability limit is $10,000 for property damage, and you cause $17,000 worth of property damage, your insurance would cover the last $7,000.