Auto Accident Claim Denied Because of an Excluded Driver?

06.06.2024 General

          I have received countless calls from Texans injured in motor vehicle crashes that tell me a story about how the police officer said the at-fault driver had valid auto insurance, yet the insurance company is now denying the claim based on an excluded driver. Next comes the frequently asked question: “Can they do that?”

Permissive Driver Doctrine in Texas

          Current Texas law requires drivers to maintain valid auto insurance. (See our article about Texas insurance requirements). Texas law also states that the insurance “[p]olicy language must provide coverage for individuals, other than family or household residents, using a covered automobile with permission.” This means if you give permission to a friend to use your insured vehicle your friend has the same coverages and rights as you under the insurance policy. The permissive driver doctrine does not cost the insured any additional money. However, Texas law protects the insurance company by allowing the company to exclude specific drivers from the insurance policy by listing the excluded driver by name.

 Who is an Excluded Driver?

          When someone applies for auto insurance the insurance agent will ask you a series of questions. Two of the questions usually include how many driving adults live in your residence and who else do you let drive the vehicle. The insurance company is asking because the company could be required to pay money damages resulting from an auto accident caused by those other drivers under the permissive driver doctrine. To protect itself, the insurance company is allowed to specifically excluded certain drivers from the insurance policy or increase the premium cost to add the other drivers to the policy.

          When the insurance company adds another driver to the policy this naturally increases the price of the policy to the consumer. So many folks decline to add other drivers to the policy despite living in the same household because of the increased cost. This is particularly harsh to innocent Texans on public roads because many families live in multi-generational households creating a financial burden to obtaining auto insurance. Otherwise, this can create a situation where you are the only person that can drive the vehicle.     

Teenage Excluded Drivers

          In our auto accident practice we commonly see parents that refuse to pay the extra premium cost to include their young driving age children to the auto insurance policy. This creates a situation where the children are identified as excluded drivers. Young, new drivers are some of the most accident-prone drivers and to exclude them creates unnecessary risk to Texas drivers. In this situation, insurance companies should not be able to issue an auto insurance policy that specifically excludes the policyholder’s young driving-age children living in the household. Instead, Texas should amend the the statute regulating this insurance industry practice.

Protecting Your Family From This Insurance Blackhole

          We encourage all families to obtain strong uninsured and underinsured coverages (UM/UIM) to protect against excluded drivers. (See previous article explaining UM/UIM policies). Likewise, it is a good practice to add all driving age adults living in the household to your auto insurance policy. This protects you because if the excluded driver is in an auto accident, the owner of the vehicle could be held financially liable. If the insurance company is claiming the excluded driver is not covered, always request the policy declaration page because the excluded driver must be clearly identified. A good auto accident lawyer is extremely helpful while navigating discussions with your insurance company.

          Contact DeKeyzer Law at (713) 904-4004 for a FREE consultation about your rights and options.