Can another person and their vehicle be covered on your auto insurance?

You are required to have an "insurable interest" in order to legally effect coverage. If you have no insurable interest then it would be unlawful to insure someone else or their property.

When it comes to property insurance a simple layman's test would be to ask yourself this question. (If the car is wrecked? what are the consequences for me?) If your answer is none. Then you have no insurable interest in that vehicle.