If you’ve ever wanted to let a good friend borrow your vehicle while theirs is in the shop getting repaired, you might understandably wonder if this would be okay with your insurance agent. The answer to this question concerns whether you have a named driver vs. any driver auto insurance policy.

What is the difference between named driver and any driver auto insurance? Keep reading to learn more about the key differences between these auto insurance policies and the pros and cons of each. This will help understand how auto insurance works and ensure you have the correct type of policy.

The Difference Between a Named Driver vs. an Any Driver Auto Insurance Policy

A named driver auto insurance policy includes the names of drivers allowed to use the vehicle. In the unfortunate event of an accident, these named drivers will also be covered by the auto insurance policy.

On the other hand, any driver auto insurance will allow anyone to use your vehicle, provided they have permission to do so.

In the example above, if you have an any driver insurance policy, it would be okay for your good friend to borrow your vehicle. But this would not be allowed if you have a named driver policy.

Your insurance company can answer questions like “what are the different types of auto insurance coverage” and go over which options might be best for you.

Benefits of Named Driver vs. Any Driver Auto Insurance

One of the main benefits of named driver vs any driver auto insurance policies is that the former tends to cost less.

A named driver auto insurance policy will include the names, ages, and driving records of everybody who can use your vehicle, so your agent, if you have one, can give you a very accurate price on your policy.

An any driver auto insurance policy, on the other hand, does not include specific information about drivers, so they tend to be among the most expensive forms of auto insurance.

Disadvantages of Named Driver vs. Any Driver Auto Insurance

The main disadvantage of a named driver vs. any driver auto insurance policy comes down to coverage.

Since only the drivers named on the policy are covered in the event of an accident, letting an “unlisted” friend use your vehicle, even for a short errand, can open you up to potential problems if your friend gets into a fender bender.

Even if you loaned your vehicle to a friend in an emergency, your auto insurance company may deny coverage in the event of an accident.

When Any Driver Insurance Makes Sense

While any driver auto insurance is expensive, there are scenarios where it might make sense to get it. For instance, if you use your vehicle as part of your business, and your employees routinely need to drive it, it can be simpler to have an any driver auto insurance policy to cover everyone.

As a small business owner’s guide to insurance-specific coverage notes, your regular auto insurance will often cover a vehicle used for work. Still, if many people are going to drive it, you should let your agent know so you can weigh your options.

Another example is if you are caring for an elderly loved one and you hire people to take them to appointments in your vehicle. If this happens a lot, you might want to ask your agent, if you have one, about affordable auto insurance quotes for nannies and caretakers.

But in general, it is more cost-effective to add family members to your policy as named drivers.

Final Thoughts on Named Driver vs. Any Driver Auto Insurance

Offering to help a friend in need is commendable, but you might want to think twice if it involves loaning out your vehicle. There are different types of auto insurance policies. If you have a named driver policy vs. any driver auto insurance, your friend will not be covered when using your vehicle.

If you decide to go with the any driver option because you plan to loan your car out more often, your agent can also let you know how quickly changes you make to your policy go into effect and how much the new policy will cost.