It is understandable that after a car accident, we want the responsible insurance company to fix our car immediately so we can get back to our regular routine. But from time to time it happens. The responsible insurance company seems to be doing nothing. When we call them and ask what is going on, they state they are dealing with ‘coverage issues.’ It can be frustrating. What does that even mean? Coverage issues?
We have found that in many of these circumstances, the issue involved is, was the person who drove the car a permissive user or not? The insurance company is saying to us in so many words, ‘the person who hit you was not listed on the insurance policy maintained on the car.’
Who is a permissive user and what does that have to do with insurance coverage? Just because a car hit you and caused damage to your car does not automatically mean that the insurance the vehicle owner has on the car will automatically cover damages to your car in the event of an accident. For the insurance coverage to kick in and pay for our property damage, the driver of the vehicle that hit you should be specifically listed on the auto insurance policy as either the policy holder, a household member listed by the company on the policy, or another listed driver on the policy who may not be a relative. Notwithstanding, the next category of people that affords coverage to you is if the driver of the car who hit you falls under the term of a ‘permissive user.’ A permissive user is someone that is not listed on the insurance policy but that the policyholder gave either direct permission or tacit permission to drive the car that hit you. Additionally, questions will be asked to confirm that the use of the vehicle by the driver was occasional.
Generally, a permissive user for whom coverage will be afforded are relatives who do NOT live in the home, a temporary guest of the home, a person who was test driving our car, a neighbor who asked to borrow the car. You get the picture.
Once the at-fault insurance carrier enters the initial claim information and notes that the person driving the car who caused the accident is NOT a listed driver they will begin an investigation to determine if coverage will be afforded. Coverage will be afforded if the policy language has a clause that allows for permissive users of the vehicles. The insurance company needs to verify the driver was a permissive user by conducting an investigation. The investigation will consist of recorded telephone statements from the vehicle owner and the the person who drove the car.
At times, when their policyholder or the driver of the vehicle gets the phone call that their insurance company needs to determine if coverage will be afforded, it is not uncommon for policyholders to not return the phone call right away which can hold up your property damage claim. In many cases, the policyholder is simply afraid they have done something wrong. They are afraid they will personally be responsible. It’s not until they understand that permissive users are generally covered drivers under their policy do they return the phone call. Unfortunately, this can take up to a week or more. Sometimes, policyholders are on vacation or some policyholders simply can by irresponsible. All of this can delay your claim. However, if it is determined that the permissive user will be covered under the policyholder of the vehicle owner, you are entitled to a daily reimbursement for the loss of use which includes all those days that their insured stalled.
Are all permissive users covered? Not necessarily. So before you loan you car to that neighbor out make sure you call the insurance company directly and confirm your policy allows for permissive users. If you went to a broker or agent when you purchased your policy and insisted you get the cheapest policy available, there exists the possibility that you have a ‘restricted’ policy. If you have a ‘restricted’ policy, no one is allowed to drive the car unless they are listed on the policy. This is why it is important you confirm you policy allows permissive drivers before you loan the car out. If the car that hit you was a restricted policy and the driver of the car was not on the policy, the insurance company will advise you immediately. Should this be the situation you will likely have to take the owner and driver of the vehicle to small claims court to get your vehicle damages recovered directly from them. Of course, if you have full coverage on your vehicle, do directly through your own insurance carrier, who will then deal with the hassle of getting reimbursed from the person who caused the accident. However, if you do not have full coverage on your car, small claims court may be your only option.
I’m Ed Smith, a Sacramento and West Sacramento Personal Injury Attorney. I have been handling cases for injury victims, for over 30 years in Yolo County and Sacramento County. If you have property damage questions, please feel free to call our office. You can also check our website which contains advice on property damage claims.
For a free and friendly discussion about your personal injury case, please call me at (916) 921-6400. I can be reached toll free outside of Sacramento at (800) 404-5400.
I am a member of Million Dollar Advocates Forum.