Should I confess that her dad has no permission to drive my car or should I let insurance cover the damage?

Well, there is the proper answer, or there is the practical answer. If you tell the truth, your relationship with the girl is over. However, since she allowed her step dad to use YOUR car without YOUR permission, I am not sure that this is the girl for you. So, make your choice. In either event, start looking for another girl.

This is really much more a question of personal ethics and human relationships than it is of law. To what extent are you willing to enmash the stepfather in legal difficulties, and maybe carrying the cost of expensive injuries or auto repairs. If you were to say that he had no permission to use the car, how badly would it affect your relationship with your Significant Other. Do you hope to have a long-term peaceful relationship with her stepfather. The answers to these questions should tell you what to do.

I believe, unless the stepdad is not a specifically excluded driver on the insurance policy, the fact your girlfriend, who you gave permission to drive your car, gave him permission to drive it will extend to him having permission to drive.

I believe that when you turn over your car to the use of your girl friend and use hers instead you are impliedly permitting her to have the authority to permit others to drive.

So I am clear, if he has your permission, your insurance will defend him on the lawsuit that will no doubt be filed, not only against dad as the driver, but as against you, as well, as the owner of the responsible vehicle. You, too, would be owed a defense by your carrier. In addition, your carrier would also have to pay, up to your policy limits, any damages owed to the injured parties. Or, if permission was not given, dad and you would be out of pocket all the costs and attorney fees referenced. I would never advise anyone to lie. I would, however, point out that permission may be given in more than one way. Obviously, there is express permission where you expressly tell the other person they can use your car. This can be done orally or in writing. The is also implied permission, where under all circumstances considered, permission is implied. This is normally granted orally.

Unless you had an agreement that only she was to use the car he had implied permission in my opinion.

It's arguable that he did have your permission, indirectly. As they say, possession is 9/10ths of the law. Once you gave permission and possession to your girlfriend, that gave her the right to let someone else drive the car unless you specifically told her you didn't want her stepdad to drive it.

From what you have told me, I would say he had permission. He certainly didn't steal the car. Furthermore, if the car was used without permission, he is not the one who stole the car (or took it for a joy ride), it is your girlfriend who took the car, because he had no way of knowing that she had no authority to lend him the car. Based on the arrangement as you describe it, your girlfriend had implied authority to lend your car to a relative, as you had implied authority to lend her car. To demonstrate what I am saying, if you let someone borrow her car, do you really think you committed a crime? Did she commit a crime by lending your car? I would never advise anyone to lie, but if you and your girlfriend had an unspoken understanding that you could let others use your cars (within reason), then he had permission. As to whether it is better for you to have it covered or not, I cannot say. If the claim exceeds your insurance, I do not think you would be liable for the excess. Your insurance may go up.

You should call your insurance agent and tell the absolute truth. The stepdad may be covered anyway since you let your girlfriend use the car. Your insurance agent may contact the other insurance company to sort it out.