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UPDATED: Mar 13, 2020
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When you purchased your vehicle and auto insurance policy, you may have been the only person that would ever drive that car. Over time, however, things change, and you may find yourself needing to add drivers to your policy. Whether you move in with someone, have children or have some other reason why a person frequently drives your vehicle, you will need to add these individuals to your insurance policy.
Adding new drivers is quite easy. The new drivers may or may not affect the cost of your insurance, but they will have access to your policy and be able to file claims and communicate with your insurance company. Before adding a new driver, it’s a good idea to determine exactly what the implications may be for your policy.
Difference Between Adding a Driver and a Co-Insured
When adding a person to your insurance policy, you can choose between adding them as a co-insured on your policy or simply listing them as a driver. Co-insureds hold equal status for the insurance company, and are each held liable for damages that a vehicle causes. In most cases, the co-insured on an auto policy should also have ownership of the vehicle.
Co-insureds can file claims against a policy, add or remove drivers, change coverages, cancel a policy and receive checks for claims. A co-insured has all of the same freedoms as any other policyholder, including you, so choose carefully before adding anyone as a co-insured on your policy.
Most co-insureds are either the spouses or college-age children. Because policyholders are legally responsible for the vehicles listed on the policy, you should not add anyone as a co-insured if they do not have a financial interest in the auto.
Listed drivers are different
A driver does not need to have any financial interest in the vehicle and will not be held personally liable for the damages that a vehicle may cause. These listed drivers are simply individuals who frequently use the vehicle.
Your insurance company needs to know who routinely drives your cars so that it can accurately assess the risk of your auto being involved in an accident. For example, if someone who drives your vehicle has an existing history of auto accidents, it’s more likely that this person would cause another accident to occur in the future.
Accurately determining risk isn’t the only reason to add someone to your policy. Listed drivers are able to file claims and discuss claims with your insurer. This is important, because unless other people are listed on your policy, you will be the only person who can discuss a claim with your insurer. That can be majorly inconvenient if you are ever unable to handle your claim yourself due to illness or injury, or if someone else wrecks your car and you were not there yourself.
Listed drivers on your vehicle will not have the ability to add or remove other drivers, change coverages, cancel the policy or make any other modifications. They also cannot have checks made out in their names, but they can receive settlements for injuries resulting from auto accidents.
How to Add Someone to Your Insurance
After you’ve decided whether to add someone to your policy as a driver or a co-insured, you simply need to contact your insurance company and request the addition. You should be able to do this over the phone with your agent or the customer service department of your insurance company.
You will need to provide the individual’s name, gender, driver’s license number and address. If the person doesn’t have the same address as you, the insurance company may ask about your relationship, and there may be some limitations about adding them. Some insurers will allow you to add anyone you want to your policy, whereas others will only let you add people who live with you.
After you’ve added the individual to your policy, the insurance company will assess the new driver’s risk by looking at the person’s driving history. If that driver is found to be high risk, your rates may increase as a result of the addition. On the other hand, your rates may not increase at all if the insurance company already knew that the person had access to your auto.
For example, your insurance company probably calls to ask you some questions around the time that your policy renews. This interview is part of the underwriting process, and it helps determine how much your premiums should increase or decrease during the next policy term. At this time, the insurance company will ask if anyone else has access to your vehicles. They will not add those people automatically to your policy, but they may modify your premiums to match your risk.
If you’re uncertain whether adding a driver will increase your premiums, you may wish to contact your agent and ask how much your policy will be affected by the addition of a driver. Depending on your circumstances, you may wish to add a driver, exclude a driver or open a secondary policy specifically for that driver, and your insurance company can help you decide what the best choice is for your needs.