Expert: Anne - 12/22/2007

Question
hi there! my mother-in-law is driving a car which i carry the lease on (along with my husband).  she does have good insurance.  however, if she were to have an accident involving injury to another party, could we (my husband and i) be legally responsible for any financial claims?  thanks!!

Answer
Hi Lela,

The answer is yes, you could be personally liable for what happens in your leased vehicle. The general rule is "insurance   follows the vehicle, not the driver" meaning that if she gets in an accident, then your insurance company would have to pay.

Her insurance company would only pay if there is any excess of damages. For example, says your policy has $25,000 limit. She causes $30,000 worth of damage, then her policy will only pay the difference after your insurance pays the first $25,000. (They would pay the $5,000).

I say this is a general rule because different insurance polices read in different ways. So it is possible that your police won't cover her as a driver. It really depends of the actual language. However, as mentioned above, the rule of thumb is "insurance follows the car".

Good Luck,

C.Q.
http://www.auto-insurance-claim-advice.com