Communal life on college campuses encourages sharing — but cars might be an exception. While lending out your car to a friend who needs to make a Target run might seem like a non-issue, car sharing among college students can run up the risk factors that make insurance expensive for young drivers. If you or your child are considering bringing a car to campus and sharing it with friends, it’s important to understand and prepare for the risks involved.
Can college students share their car with friends?
Yes — but it’s worth considering the risks.
Most car insurance policies permit occasional sharing of an insured vehicle. It’s a principle known as permissive use: if a policyholder gives another driver permission to use their vehicle, the car owner’s insurance policy typically covers any incidents while the other driver is behind the wheel. On the other hand, suppose a college friend drives your car without permission. In that case, it’s considered non-permissive use and the driver and their insurance company would be responsible for covering any damage.
For college students sharing cars, it’s important to understand how permissive use works — and what risks it exposes you to. When you allow a friend to borrow your car, you take responsibility for their actions and agree that your insurance policy will pay out for any accidents. You’re also taking on the risk of a rate increase if a friend has an accident while driving your car. On average, Bankrate found that car insurance premiums increase by as much as 45 percent following an at-fault accident.
How does sharing a car with friends impact your insurance?
Sharing a car with friends occasionally could impact your insurance if a friend is in an accident while driving your car, but it’s not likely to affect your premium otherwise. However, you may need a shared insurance policy if you plan to share a single vehicle with college friends or roommates regularly.
Anyone living at your address who uses your car should be on your auto insurance policy. If you are sharing a car with a friend or roommate and fail to add them to your policy, it could lead to a claim being denied if they’re in an accident. When making arrangements to share a car, remember that your auto insurance premiums will be based on the combined risk factors of all drivers on the policy.
What happens if a college friend is in an accident or gets a ticket?
Let’s look at a scenario: You lend your car to your college friend to make a Target run, and they get pulled over for speeding on the way to the store. Will their mistake cause your rates to go up?
Unless your friend is listed on your insurance policy, their speeding ticket shouldn’t affect your insurance rates. Your auto insurance premium is based on your driving record and those of any other listed drivers. Still, insurers won’t typically look at the record of a friend borrowing the car on a one-off basis.
What if, instead of getting a ticket, your friend rear-ends another driver at a light because they were checking Instagram? In this case, your insurance is likely to get involved. Because your policy covers your friend’s at-fault accident under permissive use, the driver they hit can file a claim with your insurance company to cover any damage to their car and medical bills. That liability claim could cause your insurance rates to go up by an average of $840 per year the next time you renew your policy.
How does car ownership affect insurance for college students?
Having a car at college comes with advantages: it’s a convenient way to get off campus and travel home on breaks. It could even be a way for students to make friends on campus. But car ownership for college students comes with hidden costs, including steep insurance premiums.
According to a recent Bankrate study, the hidden costs of car ownership average $6,684 per year nationwide, with particularly heavy costs in states with costly auto insurance premiums and high fuel costs. The costs may be even higher for college students, thanks to the price of auto insurance. Insurance companies may charge higher rates for young drivers thanks to risk factors like unsafe driving habits and the elevated risk of vandalism and theft on college campuses.
Why car insurance costs more for college students
- Drivers aged 20 to 29 have the highest motor vehicle crash fatality rate of any age group. (IIHS)
- The fatality rate for male drivers aged 20 to 29 is nearly triple the fatality rate for female drivers in the same age range. (IIHS)
- Only 88% of front seat vehicle occupants aged 16 to 24 regularly wear seat belts, compared to nearly 92% of adults aged 25 to 69. (NHTSA)
- Nearly one in four drivers in a 2024 study admitted to using Instagram while driving — more than any other smartphone app. (Cambridge Mobile Telematics)
Pros and cons of college students owning a vehicle in college
Owning a vehicle while in college offers greater flexibility and convenience than simply relying on campus transport or public transit to get around — and in some cases, having a car on hand could cut costs. For example, a car could provide access to off-campus grocery stores, which might be a cheaper alternative to college meal plans.
However, campus policies sometimes forbid students from bringing cars to campus, and the hidden costs of ownership — from gas costs to insurance — could quickly stack up. Cars on college campuses may also be exposed to additional risks, such as vandalism, drunk driving and distracted driving.
Pros
- Ability to travel home during breaks
- Convenient access to off-campus services and events
- Experience managing car ownership without parental supervision
Cons
- Some campuses ban students from owning or parking cars
- Insurance, fuel and parking costs may stack up
- College life comes with steep risks such as distraction and partying
Why some colleges don’t permit cars on campus
Many U.S. colleges discourage students, especially first-year students, from bringing cars to campus. Some schools ban student vehicles from campus altogether, while others merely discourage students from bringing cars with steep parking fees.
These policies typically serve a few goals, such as community building among new students and reducing parking costs for faculty and staff. Small liberal arts colleges, for example, often require first-year students to live on campus in order to bond with their fellow first-years. In urban universities, on the other hand, parking is at a premium, and restricting student residents from parking cars on campus frees up space for faculty and staff who need to commute.
Why college students may want to stay on a family policy
Bringing a car to campus introduces another potential problem for college students: needing to get off their parent’s policy. In general, teens and young adults can stay on their parent’s car insurance as long as their permanent address — and the address at which their car is garaged — is the same as their parents’. Staying on that family policy can drastically reduce the cost of coverage for drivers aged 18 to 21, as shown in the table below.
18-year-olds
| Gender | Average annual full coverage premium on standalone policy | Average annual full coverage premium on parent’s policy | Average annual savings |
|---|---|---|---|
| Male | $6,706 | $4,532 | $2,174 |
| Female | $6,328 | $4,197 | $2,131 |
19-year-olds
| Gender | Average annual full coverage premium on standalone policy | Average annual full coverage premium on parent’s policy | Average annual savings |
|---|---|---|---|
| Male | $5,563 | $3,981 | $1,582 |
| Female | $4,977 | $3,655 | $1,322 |
20-year-olds
| Gender | Average annual full coverage premium on standalone policy | Average annual full coverage premium on parent’s policy | Average annual savings |
|---|---|---|---|
| Male | $5,064 | $3,739 | $1,325 |
| Female | $4,544 | $3,447 | $1,097 |
21-year-olds
| Gender | Average annual full coverage premium on standalone policy | Average annual full coverage premium on parent’s policy | Average annual savings |
|---|---|---|---|
| Male | $4,184 | $3,428 | $756 |
| Female | $3,781 | $3,127 | $654 |
College students who bring a car to campus may need to move to a standalone policy, which could raise the cost of auto insurance by an average of $1,380 across the four years of college. If you’re considering bringing a car to school, you may want to weigh the added cost of insurance against the potential savings and convenience of having a vehicle on hand.
What happens if the car is vandalized or stolen?
Vandalism and car theft are two risks your car faces on a college campus — and both are covered by comprehensive insurance. Without comprehensive coverage on your vehicle’s policy, you won’t be able to file a claim if it’s stolen or vandalized.
Comprehensive coverage may increasingly be a necessity for cars on campus. According to USA Today, motor vehicle theft on U.S. college campuses nearly doubled in 2022, from 0.73 per 100k students the previous year to 1.33 per 100k.
Nationwide, car theft is on the rise, thanks in part to social media trends, with Colorado, the District of Columbia and Washington state among the frontrunners. The table below matches the metropolitan areas with the highest rates of auto theft in 2022, according to the National Insurance Crime Bureau (NICB), with leading colleges and universities in the area.
| Metropolitan statistical area | 2022 auto theft rate per 100k | Select local colleges and universities |
|---|---|---|
| Pueblo, CO | 1,086 | Colorado State University – Pueblo, Pueblo Community College |
| Bakersfield, CA | 1,072 | California State University – Bakersfield, Bakersfield College, University of LaVerne |
| Denver, CO | 1,063 | University of Colorado Denver, University of Denver, Rocky Mountain College of Art and Design |
| Memphis, TN | 846 | University of Memphis, Rhodes College |
| Portland, OR | 797 | Portland State University, Portland Community College, University of Portland, Reed College, Lewis & Clark College |
Out-of-state students: What are the insurance implications?
Students who attend college out of state may need to change their auto insurance to match their permanent address if they bring a car to campus. On the other hand, attending school out of state could mean an insurance break for families if the student doesn’t have a car on campus.
To figure out the insurance implications of attending college out of state, consider these questions:
- Does the student have a vehicle at school? If the student brings a car to school and keeps it on campus or at an off-campus address, you’ll need to update the insurance policy for the vehicle to reflect its primary garaging address. That might mean adjusting to new minimum coverage limits as required by the state.
- What is the student’s permanent address? If the student is living on campus, their permanent mailing address may still be their parents’ home, which means they can stay on a family policy if they’re not garaging a vehicle at school.
- Does the student use the family vehicle while they’re at school? If you have a college student on your family policy who goes to school at least 100 miles from home and only uses the insured vehicle(s) on breaks, you may be eligible for a discounted premium.
Talking to a licensed insurance agent could help clarify any insurance implications for a college student moving out of state.
The bottom line: Car sharing can make college easier, but it’s not without risks
Ultimately, deciding whether to share a car with college friends is a matter of weighing the benefits against the potential costs. For college students, the costs of car ownership can stack up quickly, and a single at-fault accident caused by the owner or a friend could mean a steep increase in insurance costs. But for some college students, smart ownership and savings strategies could offset the potential costs.
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