Explanation of the Non-Permissive Use Issue in Insurance Claims
This article will explain the non-permissive use issue that sometimes arises in insurance claims. By now everyone knows that an automobile insurance policy follows the car, not the policy holder. In other words, your car is the object being insured, not you; you cannot go out and drive any vehicle at any time for any reason and expect your insurance policy to just cover you. Since you know that the insurance policy follows your car, you also need to know that it does so no matter who is driving that vehicle as long as they have your permission to drive it and are not an excluded driver on the policy. Vehicle thefts documented by police reports are easily identified as cases of non-permissive use of a vehicle. What about other possible scenarios?
Permission to drive your vehicle does not have to be written. Your resident relatives (spouse, children, and other family members) usually have implied permission to be driving your vehicle and are in fact considered insured people under your policy and are even part of what determines what you pay for your policy. Even if your toddler accidentally puts your car in gear and takes out the neighbor’s retaining wall, it is covered. You can let a neighbor or a friend borrow your vehicle to run to the store, and they are covered by your policy. If your neighbor then runs a red light in your car and hits Jane Doe and her van full of kids, their damage and personal injury claims are going against your insurance policy, as is your neighbor’s medical payments claim.
Suppose you let your friend borrow your car and he takes it out partying with his buddies. He then lets one of them drive your car. The accident that buddy has when he swerves over the center line will most likely be covered by your policy unless you told your friend absolutely not to let someone else drive your car, and he remembers that you said that. Even then, if your friend’s friend had reason to think that he was indeed driving the vehicle with permission because your friend in possession of it at the time told him that he could, your insurance company will have a hard time denying the claims that arise from that accident based on the non-permissive use defense.
In cases where the policy holder claims non-permissive use of their vehicle, the burden of proof is usually on him or her, not on the person who was driving the vehicle. Unless the driver of the insured vehicle admits that he or she was driving it without permission, the policy holder must give convincing evidence to refute that. The policy-holder might submit a copy of a police report showing that the vehicle was reported stolen before the accident occurred, or a very persuasive recorded statement in which they say that the driver was told not to drive their car. There may be witnesses to support the policy holder, or not. If the policy holder has let the driver use his vehicle in the past, the defense becomes more difficult.
Cases that involve rental cars usually make non-permissive use defenses easier. The rental company may simply show a copy of the rental contract which specifically names the only parties given permission to drive their vehicle.
Automobile accidents that involve the issue of possible non-permissive use must be investigated thoroughly by your insurance adjuster or your attorney. The reason why you should care about all of this is that accidents affect your insurance rates. Insurance companies determine what to charge you for your policy in part by looking at what type of risk you are. Multiple claims against your policy make you a higher risk. Keep this in mind next time an acquaintance asks to use the keys to your car.
This article is written for informational purposes and is not intended to take the place of competent local legal counsel.
Other articles related to this topic:
The Insurance Claims Handling Process Explained.
An Explanation of Uninsured/Underinsured Motorist Coverages.
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