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Ever Heard of Nonowner Auto Liability Policies?

I hadn’t until I read about nonowner auto liabilities policies in a Baltimore Sun article [3] this past weekend. Nonowner auto liability policies are for folks who don’t have cars but find themselves renting them often enough that having their own insurance is better than taking the one offered by rental companies. According to the Insurance Information Institute, it costs only about $200-$300 a year and is a better alternative than the often $20+ a day prices from rental companies. By comparison, my insurance through Geico, which only covers liability, costs me $605 a year for a 2003 Toyota Celica. Nonowner Auto Liability policies are liability only, which means they only cover damage to the other car and not your own. Luckily, if you rent the car with a credit card, your credit card might offer a collision benefit (which one reason why you should decline the insurance offered by the rental company and rent with a card that offers insurance).

A brief look at on the Geico website didn’t yield any information about nonowner auto liability policies and when I tried with Kanetix (an auto insurance search engine I used when I tried to figure out the relationship with personal information and insurance rates [4]) it wouldn’t let me continue without putting in vehicle information. I think that if you want to take advantage of this you’ll probably have to call up the insurance company directly.

Has anyone heard of this before or know someone who has used it? Seems like a good idea for people who live in cities.