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Normally the owner's insurance does cover other drivers.
I would check with the insurance.

You as POA are able to CHANGE the insurance, as I am certain you know. You would then pay the added amount to insure other drivers. And you would pay the premium as you pay all your father's bills.
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You need to contact his insurance company.
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What we did for my BIL he didn't have a license anymore because of health reasons we just added a driver onto his policy so in case of an accident whoever drives the car is covered. Yes it cost more but its worth it.

Prayers
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By chance, I just had a conversation with my parents' insurance agent on this topic. Both have valid driving licenses, but neither one is able to drive at this point. They are named on the insurance policy, but my brother is listed as the primary driver. They actually save money this way because car insurance premiums are significantly higher for senior drivers. Our agent calls it the reverse teenage driver effect, and says the increases start to happen at about age 75.
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My insurance company charges a fee for an additional driver. However that other drivers insurance can cover him driving other vehicles. Must check with the insurance provider to find out particulars.
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It's different if he's the vehicle owner but doesn't have a valid license.

"Getting car insurance without a license can be tricky. Prepare to do some digging around and pay higher rates."

https://www.nerdwallet.com/article/insurance/how-to-get-car-insurance-without-a-license
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Judy1157: Auto insurance follows the vehicle first., i.e. Bob and Mary both have auto insurance. If Bob borrows Mary's car over the weekend and gets into an accident, the claim would be filed under Mary’s auto policy, not Bob’s.

However, this is not so 'cut and dry' in your case since your father with dementia may not have possessed auto insurance in a while especially since he did not possess a DL.
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If I remember correctly, I put mom's car on my policy and whichever car that was on the road was covered. Never both at once. So,I'd drive to her house and we would take her car places. Talk to your insurance agent. The only other way is to have the title transferred to you. Parent can call it a gift and they'll put a minimum purchase price on it.
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I would get insurance and have the ownership changed if necessary. If the car is in his name and it probably is you should call his insurance company and find out what you need to do. They'll need to see the POA document. Read over the POA and see what you are authorized to do.
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My parents wanted to keep their "sweet ride" so I could use it to take them to appointments and such. So off I went and they sold me the car for the lowest BB value there was for it. No problems at all and we just added it to our insurance. And I still have it, and drive it, and it is now "my sweet ride" LOL
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