You're doing nothing more than simply driving through a green light when a driver suddenly turns left right in front of you. You barely have time to touch the brakes before your car slams into the other vehicle. It's the worst accident you've ever been involved in.
Your car is totaled. One of your family members, a passenger, gets hurt. Emergency crews rush the rest of your family off to the hospital, and you try to talk to the other driver to exchange insurance and contact information.
That person just shrugs and says it's a borrowed car. What does that mean for you? Whose insurance will pay?
Generally speaking, the person who owns the car will need to use his or her insurance to pay. That's because insurance policies are not connected to the people who paid in most cases, even though that sounds intuitive. They're connected to the cars themselves. When that person bought the policy, they agreed to pay for coverage on that specific car, no matter who drives it.
Now, there's another side here, since an injury occurred. If you wind up seeking financial compensation, you can still start a lawsuit against the driver of the car. That person was still behind the wheel and still caused the accident, no matter who insured the car or who owned it. In some cases, such as when vehicles are owned by companies, you may be able to target the company as well, if it appears that it was negligent in some way.
These accident cases can get complicated, so make sure you understand all of your legal rights.
Source: Quote Wizard, "Borrowed car in accident. Whose insurance pays?," Stephanie Simmons, accessed March 30, 2018