Lending Your Car Out – What Do You Need to Know?

Lending out personal items is part and parcel of a holistic, loving relationship with your friends and family members. We seek opportunities to help one another, and sharing our resources is part of the love and trust language. But things can get difficult when it comes to sharing your car. If someone asks to borrow your car, what should you know first?

Legality

Naturally, one of the first concerns any driver would have regarding the lending of their vehicle to a friend relates to basic legality. Thankfully – and simply enough -, lending a car to a friend or family member is not in itself a legal issue. The borrower, of course, needs to be legally cleared to drive themselves – but there are additional legal issues that can arise – and are a little less straightforward to boot.

Insurance, and Liability

The leading issue, which has a number of potential impacts and ramifications, is that of insurance. It is common knowledge that a car or driver needs to be insured in order to drive legally on UK roads. But the way in which car insurance works is not completely intuitive.

The vast majority of insurance plans follow the car itself, and not the driver operating it. If your friend or family member is involved in a road traffic collision while driving your car, your own insurance policy – and not theirs, even if they are covered to drive their own vehicle – is highly likely to be responsible for any resulting costs.

From a legal perspective, driving ‘uninsured’ in this way is a serious criminal offence, with legal outcomes for both the driver and you. The driver could receive points on their licence or even a ban from driving, while you, as the lender, could be fined thousands of pounds.

As such, you should ensure that your friend or family member has the relevant insurance coverage to drive your car. Some comprehensive insurance policies enable people to drive other vehicles; if you are often sharing your car with this person, you could also temporarily add their name to your own insurance, but this would enshrine your own liability in the event of an accident. Temporary cheap car insurance is a simpler option, allowing anyone to insure themselves on your car for a short period of time and reducing your liability in the process.

Material Costs

While legality and insurance liability are the most important considerations to investigate before lending a car to a friend or family member, it also cannot be ignored that there is a material cost element to recognise. If the borrower in question has an incident by themselves, whether through a simple kerb scrape or a failure to notice a bollard when parking, you will be saddled with the not-insignificant repair costs yourself.

Relationships and Trust

Of course, you can chase the money from your friends and family in the event of such an incident, but doing so can sour a relationship quickly – especially if they are hard-up or unwilling to cooperate.

As such, lending a car becomes about much more than money and legal obligation; it becomes about trust and the strength of your relationship with the person.