Car Accidents Involving "Excluded Drivers"

Injured in a Dallas car accident involving an excluded driver?

Have you been told that your car accident claim was denied because the at-fault party was an excluded driver? You may still have options! Call our Dallas-Fort Worth car accident attorneys at (214) 651-6100 for a free consultation.

Sometimes people choose to exclude certain drivers from their insurance policies for a variety of reasons. The insured promises the insurance company he or she will not allow any excluded driver to drive the car. What happens if the excluded person is allowed to drive and causes a car accident? The truth is that it can get complicated.

"Named driver" policies.

Texas is a "permissive driver state," meaning that as long as you give someone permission to drive your vehicle, your car insurance policy will cover said driver—with some exceptions.

Some insurance companies in Texas offer what are called "named driver" policies which only provide coverage "for drivers specifically named on the policy and not for individuals residing in a named insured’s household." These types of policies are often referred to as 'junk policies,' and over the past few years, several bills have been filed in an effort to outlaw this type of low-rate coverage.

In fact, as of September 1st, 2013, insurance companies in Texas must now disclose (verbally and in writing) to the applicant or insured that "a named driver policy does not provide coverage for individuals residing in the insured's household that are not named on the policy" before accepting any premiums or fees (Texas Insurance Code Sec 1952.0545).

Defining the term “excluded driver.”

Whenever you purchase insurance for your car, the insurance company expects you to list every household member who will regularly drive your car. Failure to add a driver could result in a claim being denied or at least stalled.

There are several reasons why a policyholder may choose to exclude a certain person from driving his or her vehicle, but the underlying reason is to always reduce their insurance premiums.

If you add a driver to your policy who has an extremely poor driving record, it could cause a substantial increase in your premiums. A policyholder has the option to exclude a particular driver for any number of reasons—or even for no reason.

In many cases, parents will exclude their own children from their policy due to high premiums for new drivers. Some unscrupulous parents do this even when they know that the family vehicle will be driven by their child from time to time.

Car accident victims may still have options.

If you've been injured in an accident but were told that your claim was denied because the driver was excluded or not named on the policy, the first thing you should do is find an attorney who can provide a free over-the-phone consultation to review the facts of your case and answer your questions.

The first thing your attorney should do is request a copy of the driver's policy and a signed rejection form in order to verify any potential issues related to coverage. If the insurance company fails to provide proof of such an exception, they could be on the hook for any resulting damages.

If the driver is truly excluded from the policy, you have the option of suing them directly. However, it can be difficult to impossible to recover any compensation from an uninsured party even if you win a judgment in court.

Your best option in this situation may be to file an uninsured motorist (UM) claim with your own insurance company. You likely already have UM coverage on your policy, as all auto liability policies in Texas must provide uninsured motorist coverage unless the policy holder expressly declines the coverage in writing.

Filing an uninsured motorist claim does NOT mean that you will be automatically reimbursed for 100% of your damages. Insurance companies (even your own) are not in the business of handing out money when they aren't legally obligated to, and will do everything in their power to reduce the value of your claim. If you do not have an attorney on your side advocating for you, you're simply at the mercy of the insurance adjuster.