What is Permissive Use?
If you’re like most people, you’ve loaned your car out to a friend, family member, roommate, or other individual at some point in your life. However, this common practice can pose a problem to your insurance coverage unless the driver of your car is covered under permissive use. Permissive use means that your insurance provider will cover a driver who has been given explicit permission to use your vehicle. However, since auto insurance policies vary widely, it is advisable to review your policy prior to lending out your vehicle.
Who is covered?
In most car insurance policies, anyone who lives in your house is covered unless the policy specifically states otherwise. Most policies will ask you to list the family members or other residents in your home for the express purpose of including them in the insurance. Permissive use will apply to anyone who is covered in your policy. If a friend or family member occasionally drives your car but doesn’t live with you, permissive use will also cover them under most insurance policies.
Primary coverage
Generally, the car insurance follows the vehicle, not the driver. If someone has driven your car with your permission and is involved in an accident, your insurance policy will act as the primary coverage and the driver’s insurance will be secondary. If the person behind the wheel of your car is at-fault for the accident, you will have to file a claim with your insurance provider and pay the deductible. In many policies, the collision will spike your insurance rates, which you will be responsible for paying.
Excluded drivers
You may want to exclude a roommate or family member from your insurance policy if he or she has a poor driving record that will impact your coverage rates. However, if an excluded driver takes your car and causes an accident, your insurance policy will not cover the excluded driver. You may want to carefully consider excluding a driver from your policy if there is any chance that he or she will use your vehicle.
Stolen vehicles
Unfortunately, it is sometimes difficult to prove that you did not give a driver permission to use your vehicle unless the vehicle is stolen. If the thief cases an accident while driving your stolen car, you will likely have to use your comprehensive insurance to pay for any damages to your vehicle but you will not be held responsible for property damages caused to others.
You should only lend your car to trusted friends or family members who are included on your insurance policy. Avoid lending your vehicle to drivers without insurance, since your insurance provider will be solely responsible for an uninsured driver in the event of an accident. In contrast, if an insured driver uses your car and causes a collision, their insurance policy will kick in if the damages exceed your policy’s limits. Never loan your car to an intoxicated or unlicensed driver.
Permissive use laws and insurance policies can be complicated, especially when a friend or family member is involved. Avoid the confusion and ensure that your case is handled fairly by scheduling a free consultation with the legal team at John Price Law Firm. Let us fight for you and get the justice your case deserves.