Potential pitfalls of "lending" out a car on PCP

[BE57 TOY]

Hi guys

I have a car with a couple of years left on a PCP. Rather than sell the car my brother would like to take it on. I have spoken to the finance house and they cannot transfer it into his name, so, the finance and V5 is to remain in my name at my address and he will make payments for the car and insure it in his name at his address.

I'm not worried about parking tickets or speeding fines as he would duely pay these should they arise. I 100% trust my brother and there will be no problems with him not paying etc. I am also aware and not concerned over being liable for the state of the vehicle at the end of the PCP should it be returned to the dealer.

I am concerned however whether there are any other pitfalls that fall outside of our control. For example if the car was stolen, written off, or burnt out and the car is in my name - insurance in his name - would there be an issue over being paid out?

Or any other issues I haven't considered?

Thanks!

[Dave Hedgehog]

many a family has fallen apart over money

i would check to see if you could legally do this as you have a contract with the PCP provider

[P2 DJX]

Possibly Insurance - you can only insure something you have a financial interest in , and one of the first questions an insurer will ask is "Are you the registered owner and keeper of the car?" If the V5 is in YOUR name at YOUR address he may have issues , the insuere may not want to insure a car that he does not own and that is registered at someone elses address . Worth a call to the insurers me thinks.

[Codswallop]

P2 DJX said:

Possibly Insurance - you can only insure something you have a financial interest in , and one of the first questions an insurer will ask is "Are you the registered owner and keeper of the car?" If the V5 is in YOUR name at YOUR address he may have issues , the insuere may not want to insure a car that he does not own and that is registered at someone elses address . Worth a call to the insurers me thinks.

Utter codswallop. I have insured cars' owned by my dad, and vice versa with no issues whatsoever (through Admiral). Phone the insurer, tell them that the V5 is in someone else's name and they own the car, but that you are to be the policy holder, and bob's your uncle.

[mrmr96]

Codswallop said:

P2 DJX said:

Possibly Insurance - you can only insure something you have a financial interest in , and one of the first questions an insurer will ask is "Are you the registered owner and keeper of the car?" If the V5 is in YOUR name at YOUR address he may have issues , the insuere may not want to insure a car that he does not own and that is registered at someone elses address . Worth a call to the insurers me thinks.

Utter codswallop. I have insured cars' owned by my dad, and vice versa with no issues whatsoever (through Admiral). Phone the insurer, tell them that the V5 is in someone else's name and they own the car, but that you are to be the policy holder, and bob's your uncle.

Remember that fully comp insurance has two purposes:
1. It's a requirment of the law to have cover for 3rd parties
2. You want a payout if your car is damaged or written off

You'll be able to take out insurance which would cover you to legally drive, because it will have that 3rd party element, but I'm not sure if you they would neccesarily pay out if the car was written off/stolen/burnt etc, because the insured person doesn't have an insurable interest in the vehicle. i.e. they won't have suffered a loss if the car was written off, because they didn't own it in the first place.

Maybe the insurance policy needs to be in the OWNERS name, but with whoever he wants to nominate put down as the MAIN DRIVER. This isn't fronting, because you'll be telling the insurer who drives the car, but crucially the policy is in the name of the person who has the insurable insterest.

[P2 DJX]

Codswallop said:

Utter codswallop. I have insured cars' owned by my dad, and vice versa with no issues whatsoever (through Admiral). Phone the insurer, tell them that the V5 is in someone else's name and they own the car, but that you are to be the policy holder, and bob's your uncle.

And after me working in car insurance for 7 years I thought I had half a clue of what I was talking about - note to self - must try harder .

[Deva Link]

Codswallop said:

P2 DJX said:

Possibly Insurance - you can only insure something you have a financial interest in , and one of the first questions an insurer will ask is "Are you the registered owner and keeper of the car?" If the V5 is in YOUR name at YOUR address he may have issues , the insuere may not want to insure a car that he does not own and that is registered at someone elses address . Worth a call to the insurers me thinks.

Utter codswallop. I have insured cars' owned by my dad, and vice versa with no issues whatsoever (through Admiral). Phone the insurer, tell them that the V5 is in someone else's name and they own the car, but that you are to be the policy holder, and bob's your uncle.

We tried to insure MIL's car for wifey to use when MIL was ill and we got told the same thing by her insurer (Aviva), ours (LV=) and a random other one I tried. Yet loads of other people say you can do this.

To the OP, I guess your brother should call his preferred insurer and see that they say. I suppose you could insure the car yourself but with him as the main user and with the car normally being at his address. No idea what that would do to the premium though.

[mrmr96]

Deva Link said:

To the OP, I guess your brother should call his preferred insurer and see that they say. I suppose you could insure the car yourself but with him as the main user and with the car normally being at his address. No idea what that would do to the premium though.

^ That's my suggestion too. Best bet is to ring them up and ask, because there are differences between what various insurers will cover, and the only way to know for sure is to ring up and explain and ask the question.

[P2 DJX]

To clear things up ever so slightly - there will be 'some' insurers who may provide the cover - but it will come at a price. Admiral 'may' do it as was suggested - Admiral will also insure me for my car , as well as my current insurer - albeit Admiral want £500 a year more than my current insurer . What Im saying is that eventually you will get an insurer to give you what you want - but more often than not at a hefty price.

Edited by P2 DJX on Thursday 12th January 14:24

[_g_]

Note that the V5 SHOULD be transferred as he is the one mostly using the car.
V5 does not indicate ownership, or whatever is now written in big letters on the front of them to ensure there's no confusion.

No problem, however, getting insurance on someone else's vehicles. Less places like it, but then the same could be said of various things that people insure just fine (kit cars, motorhomes, high group cars, etc.)

[mrmr96]

_g_ said:

Note that the V5 SHOULD be transferred as he is the one mostly using the car.

I don't think that it follows that the main drive should be the registered keeper.
It's entirely possible for the...
1. Owner
2. Registered Keeper
3. Main Driver
...to be completely different people or indeed corporate entities (in the case of Owner and Registered Keeper).

If you think that there's a reson for the Registered Keeper to be set to be the Main Driver, could you please explain why as I've not heard that before. Cheers.

[_g_]

Ah, fair point; on the V5 (just checked) it does say "it shows who is responsible for registering and taxing the vehicle".

This wasn't how I understood it, but seeing that it's also in big letters on the front of the V5, would seem to be the case.
Always presumed there was merely an exemption for company vehicles.

[BE57 TOY]

Thanks for all the input guys. I will look into your suggestions.

Is it even possible for me to take out an insurance policy for which I am not the main driver?

And does the person insuring a car really need to have money tied up within a car? If the insurance company are willing to insure the vehicle for him for a certain value - and the insured vehicle is written off - surely as the policy holder of that car they would need to pay out to him? Is it relevant the car is in my name, if when insuring the vehicle he stated he is not the registered keeper?

[_g_]

BE57 TOY said:

And does the person insuring a car really need to have money tied up within a car? If the insurance company are willing to insure the vehicle for him for a certain value - and the insured vehicle is written off - surely as the policy holder of that car they would need to pay out to him? Is it relevant the car is in my name, if when insuring the vehicle he stated he is not the registered keeper?

Definitely can get an insurance policy for a vehicle you're not the owner of.
In fact there's the companies that do insurance by the day for exactly that point - so you can easily borrow a friend's car etc.
I presume they do pay out to the policy holder.

[Fish981]

When I've had insurance on somebody else's vehicle the policy has had words like 'note the financial interest of blahdy blah'

[BE57 TOY]

Fish981 said:

When I've had insurance on somebody else's vehicle the policy has had words like 'note the financial interest of blahdy blah'

How so?