Car Loan and Car Insurance Policy
Alicia : Does your car insurance policy have to have the same name as the car loan?
Response : This is not a requirement of the insurance company but a requirement of the car financier. As per the terms of agreement of you car loan, the financier will insist on the borrower to maintain Full Coverage Auto Insurance policy coverage to protect their own interest (lien) on the property until the loan is fully paid. If you fail to do this than under the terms of the finance agreement you will be under default and breach your contract. The financier will have the option of repossession of the vehicle and other remedies at his disposal.
The Insurance policy should be properly in the name of the vehicle owner with any additional drivers listed as additional insured on the policy. This would mean that all the persons having a driving license and staying with you should be declared as additional insured. This is for the liability coverage since the liability would be on the person driving the vehicle and the Comprehensive and collision coverage will be on the vehicle – which is the property of the person in whose name the car is registered and is the owner.
Sometimes the financer will ask you to take a gap insurance coverage.
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Teen auto insurance
Tagged with: Additional Insured • Auto Insurance Policy • Car Insurance Policy • Car Loan • Collision Coverage • Finance Agreement • Financier • Full Coverage Auto Insurance • Gap • Gap Coverage • Gap Insurance • Gap Insurance Coverage • Insurance • Insurance Company • Liability Coverage • Policy Coverage • Repossession • Vehicle Owner
Filed under: Insurance regulations
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