Can Car Registration and Insurance be in Different Names?

Last updated on March 17, 2023

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When it comes to insuring a vehicle, many policies may affect your ability to do so legally. Depending on the state you live in, there may be certain rules that you have to follow.

If you are driving a car that does not belong to you, then you may wonder if it is legal to take out an insurance policy on it. While some states allow you to do this, others may not be as willing to allow it.

Curious about whether or not you can have a different name on the car registration and insurance policy? Keep reading to find out.

Can Car Registration and Insurance be Under Different Names?

In most cases, it is perfectly legal to register your car and get car insurance under different names. This is true for most insurance companies and most of the states in the United States.

However, it is important to note that you should always check with your insurance provider to ensure this is the case for them. This is because some insurance carriers will not allow the insurance to have a different name than the registration of the vehicle.

The best rule of thumb to follow in these situations is to check the laws in your state before you register a new vehicle that may be driven by someone else. Then, of course, check also with your insurance carrier to make sure it is common practice with them.

What are the Most Common Reasons for the Car Registration and Insurance Being Under Different Names?

For the most part, there are several reasons why you may have your car registered under one name but insured under another. Most of these reasons include a change in who will be driving the car the majority of the time.

Wondering what reasons you may want to insure your vehicle under a different name? Keep reading to find out.

Another Adult in the Household is the Primary Driver

In some cases, you may be purchasing a vehicle that another family member will be driving the majority of the time. When this happens, you will want to ensure that the insurance is under their name so that they are covered legally.

For example, if you purchase a vehicle that your spouse or another adult family member will be driving, they will need an insurance policy in their name. Since you will not be driving the car, it makes more sense to handle it in this way.

Your Child is the Primary Driver

In many families, when a child becomes the legal age for driving, a vehicle is often purchased for them to drive. Since the child is not old enough or does not have employment, the parent is the one to register the car in their name.

When it comes to driving the vehicle, however, many parents make a deal with the child that they will pay for the car, but the child must pay for the insurance. In most cases, this means that the teen will take out a policy in their name although the registration is in their parents' name.

What are the Disadvantages of a Car Registration and Insurance Being Under Different Names?

While most of these cases make sense for car registration and insurance to be under different names, there are some disadvantages to doing so. These reasons typically have more to do with the insurance company and how they pay claims than anything else.

Curious about the disadvantages of car registration and insurance being under different names? Read on below to learn more.

Delayed Claims

In the case of an accident in a vehicle that has a different name on the policy than the registration, the insurance company may balk at paying any claim. This is because it can get confusing who they are supposed to pay the claim.

In some cases, the insurance carrier may decide that since the vehicle is registered to a different person, they are the ones who will be issued the claim. This can negatively affect the insurer and keep them from getting a settlement.

However, in other cases, if it is not clear to the insurance carrier, they may delay the claim altogether. They may ask for further proof that you had the right to insure the vehicle in your name even though another person has it registered in their name.

Overall, any insurance claim that you file can be delayed if the registration does not match the name of the insured. This, of course, will depend on the insurance carrier and their current policies concerning this type of situation.

Denial of Claims

In other cases, an insurance carrier may deny the claim altogether if they cannot verify the reasons for the registration being under another name. This is contingent on the policies they have in place and whether or not you were forthcoming when you purchased the policy.

In some instances, individuals will take out an insurance policy in some other person’s name to avoid high insurance premiums. This is especially true when they have a spotty driving record and want to save some money.

If an insurance company suspects that you may be committing fraud, they will deny any claim to the policy until it is sorted out. If you can prove that this is not the situation you are in, then they may go ahead and pay for the claim.

Overall, if you have a car and the registration and insurance are in different names, it may be best to let the insurance company know upfront. This can reduce the confusion and keep them from denying your claim altogether.

Alternatives to Car Registration and Insurance Being in Different Names

If you are worried about an insurance policy not paying out when a claim is filed because of the name being different on the registration and insurance, there are steps you can take. These alternatives can reduce the headache you may suffer when trying to file a claim that the insurance is delaying or denying.

For those looking for ways to make sure your claims are paid out and avoid confusion, below are some of the most common alternatives.

Non-Owner Insurance Policy

This type of policy can be purchased for a vehicle that will be driven by someone other than the owner. Many of these cases involve employees of a family such as nannies or chauffeurs that drive the cars but do not own them.

Most insurance companies will allow you to take out a non-owner insurance policy so that you can ensure that anyone driving your vehicle is covered under the law. This adds a layer of protection for non-owners but also makes sure that those individuals are protected from any liability.

Add the Driver’s Name on the Registration

To reduce the risk of the insurance agency refusing to pay a claim, you may want to consider adding the driver’s name to the registration. This will provide enough protection and proof for the insurance company to cover any claim.

It is important to keep in mind that in most states, it is allowable for more than one name to be added to a car’s registration. This means that you can easily add your family member’s name to the car registration so they can then get an insurance policy easily.

Add the Owner’s Name to the Insurance Policy

Another option that is available to reduce the chance of an insurance company delaying or denying any claim on your car is to add the owner’s name to the policy. So instead of adding another person’s name to the registration, adding the owner’s name to the insurance policy may be much easier.

In most cases, it is suggested that the owner take the insurance policy out in their name and then add the driver to it. This way, the policy name, and the car registration will match and will allow for less confusion.

It may be important to note that doing this will depend entirely on the insurance company and the state you live in. While most companies allow you to add another person to your policy, others may not.

Are There State Laws to Prevent This From Being Legal?

The ability to have a different name on your car registration and insurance policy will depend on the state in which you live. While in many states, this is allowed, other states do not allow this to happen.

Some states have a policy that whoever’s name is on the car registration, must also appear on the insurance policy. In these states, they do not allow for any other name to be able to purchase a policy on a vehicle that is owned by someone else.

Other states allow for two names to appear on the car registration, however, they state that both names should appear on the insurance policy as well.

Keep in mind that many insurance companies have the provision in place that if you are attempting to purchase a policy for a vehicle you do not own, you may be required to show proof of your interest in the car.

If you do not provide the company with this information and you have an accident in the car, you are legally liable for the damages. This is a great reason for you to ensure what the rules and policies are in your state.

Reference Legal Explanations

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