What Is an Excluded Driver on an Insurance Policy?

An excluded driver is someone in your household who has been explicitly left out from your car insurance coverage. This is usually done with an endorsement on the policy showing the name of the driver and clearly marking the person as excluded from driving the insured car. Then, such a person isn’t insured and any damages and injuries they may cause won’t be covered if they drive the auto and cause an accident. Normally, auto insurance companies rate every driver and anyone in driving age in the policyholders’ household and provide coverage for them.

You can exclude someone with a driver license who won’t be driving your car from insurance in most states. If they have a bad driving record or considered high-risk due to their age, excluding them can lower your auto insurance premiums. Normally, you need to include people of driving age in your household so that your insurer can rate the person and charge an appropriate premium. Some states may not allow named driver exclusions in vehicle insurance policies.

Auto insurance companies may want a named driver exclusion clause too when they consider the driver to be high-risk or poses a significant liability or doesn’t qualify for coverage under their underwriting standards. Reasons for excluding a driver may include a traffic violation like a DUI, a history of accidents or a suspended or revoked driver’s license. By excluding the driver, the insurance company seeks to limit its exposure to potential claims arising from the excluded driver’s actions.

If someone in your household may drive your car even occasionally, you shouldn’t exclude them because members of your household either need to be included and rated or they are excluded. They cannot be considered as occasional drivers, who are people who don’t leave with you but may drive your vehicle with your permission for a short errand and on the off-chance. Such drivers are usually covered by standard automobile insurance policies, as long as they aren’t a member of your household. So, you should be careful about the distinction.

Another distinction to note is between excluded and removed drivers. When someone leaves your household, you may remove them from your policy. In such cases, they aren’t mentioned in the policy at all. For example, if a child leaves home for good and moves into their own apartment, they can be removed from your car insurance. Since they aren’t a member of your household anymore, they would be covered as a permissive driver, if they ever drive your car occasionally.

Another distinction is the children away at college. Although they are currently studying away from home, they are normally considered as members of your household. If you ever remove them from your policy, you need to make sure that they are added again when they are back from the college, even for a short school break.

Each company may have their own rules about named driver exclusion. Often you may need to sign a form to indicate you want to exclude a person from your policy. State rules differ too as some states may not allow named driver exclusions and others may only allow it when the excluded driver has their own car and insurance.

It is important to note that if an excluded driver causes an accident, they may be personally liable for any damages or injuries resulting from the incident. Without insurance, they may have to pay for the losses they caused out of pocket. Therefore, it’s crucial to understand the terms and conditions of an insurance policy and abide by its provisions regarding excluded drivers to avoid any potential legal and financial consequences.