Kevin, 

Insurance is personal and it follows the vehicle.  It doesn't matter who is driving, John and his vehicle are the insured. If John - or his vehicle - cause a loss, John is liable and his insurance will pay as primary.  If Mary's brother has insurance (not likely), his insurance would be excess. 

You are correct.  What Mary's brother did is against the law and he will be ticketed/fined. 

Jan