Excluded Drivers: Who is Covered on My Auto Insurance Policy and Who is Not?

With auto insurance, a standard in the industry concerns the concept of permissive use. With most private passenger auto policies, the insurance follows the vehicle, not the driver. This doesn’t mean that your driving experience, driving record and other factors won’t play a part in determining how much you’re paying. Clearly, you and other members of your household will be rated based on those, and other, factors. Permissive use means whoever drives your car, with your permission, will be covered to the policy limits and subject to the same deductible amounts. In other words, if you own an insurance policy on your car, and you give permission for someone to drive your car, whether they live in your household or not, generally, that person will be covered under the language, coverage limits and deductible amounts of your policy.

There is an exception to this, however. If someone is excluded from coverage on your policy, even with your permission to drive your car, they will not be covered under your insurance policy under any circumstances. The named driver exclusion is an endorsement to the auto policy and the owner of the policy must sign a document certifying that the named individual is excluded from coverage. This is a legal documents and it’s language is binding. Generally, the insurance company will exclude the driver from all vehicles in the household. There are several reasons why someone would be excluded from coverage. A common cause is someone’s unfavorable driving history. When insurance companies underwrite the risk that an individual, their household and their cars present, they look at many factors including, but not limited to, and for obvious reasons, one’s driving history.

If someone’s applying for auto insurance and they, a member of their household or a non-resident regular driver has a DUI, multiple chargeable accidents, moving violations, infractions or citations, they’re considered high risk and they’ll often be ineligible for coverage. Due to this, rather than have the entire household seek coverage from another carrier, the insurance company often offers to exclude that driver from coverage. If you already have insurance with a company and someone rated on your policy, or living in your household, including you, become uninsurable, your insurance company will often require that driver be excluded or they will non-renew the policy. This can be beneficial for both the company and the family because it enables the remainder of the household to stay insured while excluding one (or more) drivers.  In addition to this, the insurance company won’t have to commit to insuring someone who’s a big exposure.In any case, whoever is excluded from coverage will not be insured with your household’s insurance company and they’ll have to seek high risk insurance elsewhere. This is often the case with kids who’ve recently received their license and they’re engaging in risky behavior.

As always, check with your State’s Motor Vehicle Department for an explanation of driving rules in your State and talk with your insurance agent about the features of your insurance policy.