Car insurance without a license: options for owners who don't drive

Who needs car insurance without a license?

More people than you might think. A driver's license is permission to drive. Car ownership and registration are separate, so a person can own and insure a car without ever driving it.

For older drivers who give up the keys but keep the car for a family member to drive them around, see car insurance for senior drivers.

Can you register and insure a car without a license?

Registration rules are set by each state's DMV. Some states let a person without a license register a car if they can prove who they are and show insurance, and New York is a useful example. Its registration and title form asks for the primary registrant's license number but allows "No ID #," and its identity guide (form ID-82) accepts other documents, such as a US passport, adding up to 6 points.

Insurance is the other half. New York requires the insurance to be issued in the registrant's name and to stay in force while the registration is valid, even if the car is not used. So a New York owner without a license still needs a policy in their own name. Our post on insuring a car not in your name explains how states differ on this.

Check your own DMV's rules before you buy. Our state minimums tool shows the coverage each state requires.

How insurers handle an owner who doesn't drive

Insurers price the policy on the people likely to drive the car. The NAIC notes that insurers can base premiums on all insured drivers in your household, and the Texas Department of Insurance (TDI) says some companies require everyone of driving age who lives with you to be on the policy.

When the owner doesn't drive, insurers commonly ask for:

• The owner as named insured. You sign the policy, pay the premium and get the notices.
• A licensed primary driver. The person who will drive the car most is listed and rated.
• Your license status. Some insurers list a non-driving owner as a non-driver or as an excluded driver; others won't write the policy at all. Practices differ, so ask several insurers or an agent.
• Where the car is kept and how it's used. These details also affect the price.

Be accurate. TDI warns that if an insurer discovers a driver you didn't disclose, it can bill you for the extra premium, deny claims or refuse to renew.

Excluded drivers

A named driver exclusion removes a specific person from your coverage. Households sometimes use it for someone without a valid license, or with a poor record, to keep the price down or to keep the policy at all.

The trade-off is strict. Michigan's insurance code allows a policy to exclude a named person, but only with a written warning on the policy and the certificate of insurance. That warning says the policy's liability coverage stops for everyone when that person drives, and the owners stay fully liable themselves.

If someone in your home is excluded, keep the keys away from them. A crash with an excluded driver can leave you paying out of pocket.

Learner's permits

A learner's permit is not a full license, but permit holders do drive. TDI says Texas law does not require you to insure a teen who only has a learner's permit, but that you should always tell your insurer if a teen is learning in your car. If you don't, TDI warns, the insurer could deny a claim, void the policy or refuse to renew.

A common approach is to keep the permit holder on the policy of the car they practice in and add them as a rated driver once they get a license. Rules vary by state and insurer, so call before the first practice drive. See car insurance for teen drivers and our post on graduated driver licensing by state.

Suspended or revoked licenses

A suspension affects both your driving and your insurance.

• Your insurer may cancel. TDI lists a suspended or revoked license or registration as a reason a Texas insurer can cancel a policy mid-term, and that includes other drivers who live with you or use your car.
• Your car may still need coverage. If the car stays registered, many states still require insurance on it, even while you can't drive. Dropping coverage can create a lapse, which brings its own penalties; see car insurance lapse.
• You may need an SR-22 to get your license back. Virginia, for example, requires an SR-22 for 3 years after an uninsured-vehicle suspension, and Texas requires an SR-22 to be kept for 2 years from the most recent conviction or judgment that triggered it. Read our full guide to SR-22 insurance.
• A lapse can itself cause a suspension. In New York, a lapse of 91 days or more suspends the driver license as well as the registration.

If the suspension follows a DUI, see car insurance after a DUI.

Non-owner policies: the reverse case

A non-owner policy is for someone who drives but doesn't own a car. It covers your liability when you drive borrowed or rented cars. It is also how many people file an SR-22 when they have no vehicle. Oregon's DMV says you must file an SR-22 even if you don't own a vehicle, and calls this an "operator" certificate.

A non-owner policy doesn't help someone who owns a car but can't drive it. In that case the car needs its own policy. Read non owner car insurance for details.

How to insure a car if you don't have a license

1. Check your state's registration and insurance rules. Find out what ID the DMV accepts and whether the insurance must be in the registrant's name.
2. Decide who will drive the car. Choose a licensed primary driver and get their details, including their driving record.
3. Ask insurers how they treat a non-driving owner. Some list you as a non-driver, some as excluded and some won't write the policy. An independent agent can compare several companies.
4. List every regular driver. Include household members of driving age if the insurer requires it.
5. Choose limits and coverage. At least your state's minimum liability; add collision and comprehensive if the car is financed or valuable.
6. Handle exclusions carefully. If anyone is excluded, make sure they never drive the car.
7. Update the policy when things change. Tell the insurer when you get a license, a permit holder starts driving or a suspension ends.