Auto Insurance: Removing Exclusions

Exclusions and removals mean different things to an insurance company. You can remove a driver from your car insurance policy if they no longer live with you or drive your car regularly. However, exclusions are for household members who you specifically leave off your car insurance, usually because they are considered a risky driver. Not all states allow exclusions, and an exclusion lasts until you request its removal.

Removing vs excluding drivers

'Removing' and 'excluding' drivers from an auto insurance policy are two different things.

Removing a driver

If a household member moves out and no longer drives your car regularly, you may choose to remove them from your car insurance policy. This is best if they don't regularly drive. You will need to call your insurer to do this, and they may request proof before removing the driver.

Excluding a driver

An excluded driver is a person in your household who has been explicitly excluded from coverage under your car insurance policy. Their name will show as "'excluded'" on your policy, and they won't be insured to drive any vehicles on your policy. You may choose to exclude a driver if they have a bad driving record that is increasing your insurance rates.

Removing vs Excluding

Removing a driver is best if they don't live with you anymore and don't need to drive your car. Excluding a driver is best if they have a bad driving record, as this will prevent their record from increasing your insurance rates.

Removing a driver from a policy

Removing a driver from a car insurance policy is a straightforward process, but it's important to understand the difference between removing and excluding a driver, as they have distinct implications.

If a household member no longer resides with you and doesn't drive your car regularly, you can remove them from your car insurance policy. This typically applies when a young adult child leaves home or a spouse moves out. It's best to retain college students who are away at school on the policy if they intend to drive the car during breaks.

To remove a driver, contact your insurance provider. Some insurers may allow removal through their app or website, while others may require a phone call or even a signed removal request letter. Certain insurers may request proof of the driver's change of residence, such as a utility bill or lease agreement, before finalising the removal.

Excluding a Driver from a Policy

Excluding a driver is different from removing them. Exclusion is suitable when you don't want a household member to be covered by your insurance due to a poor driving record or other reasons. Their name will be listed as “excluded” on your policy, and they won't be insured to drive any vehicles on it. This step can help prevent their driving record from increasing your insurance rates.

To exclude a driver, contact your insurance company and fill out a driver exclusion form. Note that not all states allow exclusions, and some may require the excluded driver to have their own insurance first. An exclusion remains in place until you request its removal.

Insurance Considerations

It's important to remember that removing or excluding a driver may impact your insurance rates. Removing a high-risk driver could lower your rates, while removing a good driver might increase them. Excluding a driver may reduce your premium if they have a poor driving record.

Additionally, if an excluded driver gets into an accident with your vehicle, your policy may not cover the incident, leaving the driver personally liable for damages and injuries. Therefore, it's crucial to ensure the driver no longer has access to your vehicle after exclusion.

Excluding a driver from a policy

An excluded driver is a person in your household who has been explicitly removed from coverage under your car insurance policy. Their name will show as "excluded" on your policy, and they won't be insured to drive any vehicles on your policy. A rated driver, on the other hand, is a member of your household who is of driving age and covered by the policy when using the insured car(s).

You might want to exclude a driver from your policy if they are causing your insurance rates to increase, either due to inexperience or a bad driving record. Excluding them from your policy could lower your car insurance rate. However, some states prohibit excluding anyone in your household who is of driving age.

To exclude a driver from your policy, you need to contact your insurance company and follow any instructions they provide. You may have to fill out and sign a driver exclusion form. However, be aware that the rules for excluding drivers vary by state and insurer, and not all states allow for excluded drivers.

It's important to note that excluding a driver from your insurance policy means they are not covered by your insurance in any circumstances. If an excluded driver uses your car and has an accident, your car insurance won't provide coverage. As such, you shouldn't exclude a driver if they plan to drive your car, even occasionally.

It's also worth noting that "removing a driver" and "excluding a driver" are two different things. After you remove a driver from a car insurance policy, their name will be taken off your policy.

Reasons for excluding a driver

An excluded driver is someone in your household who has been explicitly removed from your car insurance policy. This can be done either by the policyholder or the insurer. There are several reasons why a policyholder or insurance company might consider excluding a driver from their car insurance policy, but it usually comes down to risk and the potential for increased insurance costs. Here are some common reasons for excluding a driver:

• High-Risk Driver: A driver with a poor driving record, such as multiple accidents, violations, or a DUI, can cause a significant increase in insurance rates. By excluding such a driver, policyholders can avoid higher premiums.
• Inexperience: Inexperienced drivers, such as teenagers, often fall into the high-risk category due to their lack of driving history. Excluding them can help keep insurance costs down.
• License Status: Drivers with suspended or revoked licenses may be excluded. In such cases, the exclusion allows the policyholder to retain coverage for other household members.
• Elderly or Disabled Household Members: In some cases, elderly relatives who can no longer drive or disabled household members may be excluded from a policy. This is typically done to reduce insurance costs for the policyholder.
• Roommates with Vehicles: If a roommate has their own vehicle and insurance, they can be excluded from your policy. This is because they are already insured and are less likely to need to borrow your vehicle.
• Cost Savings: Excluding certain drivers can result in considerable savings on insurance rates. For example, excluding a high-risk driver with a history of accidents or violations can lead to lower premiums.

It is important to note that not all states allow policyholders to exclude household members from coverage. Some states prohibit named driver exclusions altogether, while others have specific restrictions. Additionally, excluding a driver means they will not be covered by your insurance in any circumstances, even in an emergency. Therefore, it is crucial to carefully consider the implications of excluding a driver before making any changes to your policy.

Risky drivers and insurance costs

Risky drivers are often charged higher insurance costs. These drivers are deemed to be more likely to make a claim, and insurance companies will increase their premiums as a result. There are many reasons why someone might be considered a high-risk driver, including:

• Driving under the influence of drugs or alcohol
• Reckless driving
• Multiple speeding tickets
• More than one recent at-fault collision
• Poor credit history
• Inexperience

The cost of insurance for high-risk drivers varies depending on the driver's profile and the insurance company. The average cost of high-risk car insurance in the US is $3,217 per year, but it can range from $1,459 to $20,000 per year. In Canada, high-risk car insurance can cost between $8,000 and $20,000 per year.

There are ways for high-risk drivers to reduce their insurance costs. One way is to focus on improving their driving record by avoiding accidents and traffic violations. After several years without any incidents, insurance companies may consider the driver to be lower risk and decrease their premiums. Young drivers can also complete a recognised driver training course to show insurance companies that they are less likely to get into an accident.

Another way to reduce costs is to take advantage of discounts offered by insurance companies. For example, insuring both your car and house with the same company or insuring multiple vehicles can often get you a discount. Increasing your deductible, which is the amount you have to pay when you make a claim, can also lower your premium as it reduces the insurance company's risk.

In some cases, high-risk drivers may be excluded from a car insurance policy to prevent their bad driving record from affecting the insurance costs of others. However, this means that any accident involving the excluded driver will not be covered by the insurer.

Frequently asked questions