"If you loan the car to your brother-in-law and he wrecks it on the way to the store, (your auto insurance) has to cover that," says Gary Massey Jr., an attorney with Massey & Associates PC in Chattanooga, Tenn., who specializes in auto accidents and personal injury cases. "If your brother-in-law moves in with you, he's not covered anymore."
Massey says to prevent safe drivers from purchasing car insurance for risky drivers they live with, insurance companies only provide coverage for drivers listed on the policy and those outside of the driver's home who borrow the car.
"A person who lives in your house might drive your car all the time, and it significantly increases your risk of that person wrecking your car," Massey says. "A person who doesn't live with you is probably not going to borrow your car enough to affect the overall risk calculation."