Unlisted Driver Not Living with Me

[Chico898]

This is Ohio, and All State.

We have lots of family members that come in to town on a very frequent basis, and I found a really good lease deal so I got a 3rd vehicle. I let these family members (not usually staying with me) use it. I hold insurance as the lease holder, and I am confident all the drivers are properly licensed and have their own insurance.

I received a letter from all state saying that I "may not be covered" if an incident occurs and the driver is not a listed driver living with me. This is a "change" that will take effect with my next renewal.

My assumption (anyone please correct me) is that the driver insurance would be the primary coverage, and my coverage is what is required as the official leaseholder.

I would appreciate any feedback you all can give me based on your knowledge and experience, what this change might be about, what are some of the potential issues with this arrangement.

Thank you.

 

[djs]

Ask your agent for clarification to be certain what they are referring to.

As a general answer, you are correct, the policy that insures that specific car is primary, but keep in mind, exclusions are there to limit exposure. The letter is referring to someone who lives in your house on a regular basis (not staying for a week, but stays more regularly) and that you allow to drive your car, or (unstated) anyone you allow to routinely use your car.

So, if you have a relative that comes in town, you allow them to use the car for the long weekend and then they go back home, this is a 'permissive user' and is covered on most policies. Usually a claim of this nature results in a lot of questions, but gets covered without any real issue.

Now, the fact that you say you have this happen a lot leads me to wonder what makes this happen. If you loan the car out more then you drive it, then the insurance company may have a problem with this, though I'm not sure how they would know. If you are 'renting' it out, then there would be no coverage.

If you have the same family members coming back frequently, then they may be regular or routine drivers and should be listed as a driver. If its different family members, then its usually not a big problem.

Dan

 

[NIAMAN]

I guess I am just a cynical ol' man, but I wouldn't 'assume" that they have Valid license and auto insurance. Then again, maybe you have classier family and friends than I do !

 

[indienoise]

Sounds like a bit of a gray area. Permissive use is generally accepted as a non-resident who does not regularly operate the vehicle. If you get an adjuster with a wild hair, I guess they could conceivably challenge whether this is considered "regular use" or not.
Now, if you have a nonstandard auto policy with Allstate, you might want to check with your agent if they are going to a named driver policy. If so, this would mean they will only provide coverage for drivers specifically named on the policy declarations.