Permissive use car insurance: What is it, and is it standard on all policies?

What is permissive use car insurance?

Permissive use car insurance is a feature of most auto insurance policies that covers someone who borrows your car with your permission. It is meant for occasional use, and the coverage depends on your policy, state rules, and insurer.

“If you give someone permission to drive your vehicle under a temporary term, they are covered up to policy limits," says Zack Pope, agency manager at David Pope Insurance.

Permissive use means that infrequent drivers of your vehicle get the same insurance coverage as listed drivers. However, insurers limit the benefit to people who drive your car less than 12 times a year. If someone drives your car more frequently, they need to be listed on your policy.

It's important to note that including permissive use in your auto insurance policy isn’t mandatory. Although most major insurers allow permissive use, smaller insurers may not. To be sure if your policy includes permissive use, read your policy and speak with your agent.

Express vs. implied permission

Permission can be express or implied. Express permission means you clearly told someone they could drive your car. Implied permission means your actions show that you allowed it, such as handing over the keys. Either way, the driver must have your permission for permissive use to apply.

Express permission means you have given verbal or written permission for the person to drive your car. That could be face-to-face, over the phone or even via a text message.

Example: Gene asks his neighbor, Layla, to go pick up his son from school because he's stuck at home waiting for a delivery. He calls Layla and asks her, and adds, "You can take my car." He then gives Layla the keys. He has given her express permission to use his car.

Implied permission means that while you haven't given express permission, it is implied that the person is permitted to use your car.

Example: Gene and Layla are making a joint trip to drop off some donations; the items are loaded in Gene's car, and Layla drives to the donation center. Even though Gene doesn't say, "You can drive my car to drop these things off," he has given her implied permission by handing her the keys.

Who qualifies as a permissive driver on car insurance?

A permissive driver is someone who occasionally drives your car with your permission. This is anyone who does not live in your household and does not regularly use your vehicle. Some insurers use fewer than 12 times a year as a guideline, but the exact rule depends on your policy.

"Typically, it is someone who does not live in the household and who does not drive the vehicle(s) frequently. Occasionally, companies consider someone who lives with you and has their own insurance a permissive driver, but that is becoming rare," Pope says.

For example, if you ask a neighbor to pick up your kids from school occasionally using your car, that would count as permissive use. Loaning your vehicle to a friend visiting from out of town for the weekend would also be permissive use.

Who is not covered under permissive use?

Permissive use does not cover every driver. Excluded drivers, unauthorized drivers, thieves, and people using your car for excluded business purposes are not covered. Household members and frequent drivers may also be denied coverage if they should have been listed on the policy.

For example, your spouse has regular access to your car and needs to be listed on your policy. Or, you may let a neighbor use your car every week for groceries. They should be listed on your insurance policy because they frequently use your vehicle.

Permissive use also won’t cover anyone borrowing your car for business purposes. For example, if your neighbor borrows your car to deliver pizza, your insurance may not cover an accident.

Additionally, permissive use doesn't cover anyone who takes your car without permission, commits a crime or is an excluded driver. So, for example, if someone steals your car, your insurance doesn’t extend to the thief.

How does permissive use car insurance work?

Permissive use car insurance works by extending your policy to someone who occasionally drives your car with your permission. If that driver causes an accident, your insurance usually pays first because coverage follows your car. Your policy limits, deductibleThe deductible is the amount you pay out of pocket for a covered loss when you file a claim., and exclusionsItems that are specifically denied coverage under the terms of an insurance policy. For example, most auto insurance policies exclude coverage for normal wear and tear, drag racing and intentional acts. still apply.

Example: Gene loans his neighbor, Layla, his car for a road trip. Layla is distracted in traffic and rear-ends another car. Gene files a claimAn insurance claim is a request you make to your insurance company for coverage after your car is damaged or you have an accident. You can file a claim online, by phone, or in writing. with his insurer. His liability coverage pays for the damage to the other vehicle, and his collision coverageCollision coverage helps pay for repairs or replacement of your car if it's damaged in an accident, regardless of who is at fault and is subject to a deductible. pays for damage to his car.

Important to know: If someone driving your car with your permission causes an accident, your insurance may go up as a result, even though you weren't driving. Choose permissive drivers wisely.

Do all insurance companies include permissive use for car insurance?

Permissive use is considered to be a standard feature on a car insurance policy but is not guaranteed. Most larger insurers allow permissive use, but some smaller insurers may not. Additionally, specialized coverage, such as for high-risk drivers, may not include permissive use.

It’s important not to assume your policy includes permissive use. Be sure to read your policy carefully before allowing others to borrow your car. If you still have questions, reach out to your insurer.

Permissive use vs. listed driver

Permissive use is for occasional drivers who borrow your car with permission. A listed driver is someone named on your policy because they live with you or regularly drive your vehicle. Listed drivers are rated on your policy, while permissive drivers are not.

This table compares permissive use and listed drivers in various categories.

Categories	Permissive use	Listed driver
Driving frequency	Less than 12 times a year	Unlimited
Coverage	Same as policy	Same as policy
Impact on rates	Doesn’t affect rates	Affects rates
Length of coverage	Temporary	Policy term
Process to allow driving	Policyholder permission	Must add the driver to the policy
Impact of an at-fault accident	Will affect your rates	Will affect your rates
Impact of a ticket	Won’t affect your rates	Will affect your rates

FAQ: Permissive use car insurance

Is permissive use included in every car insurance policy?

No. Most standard auto policies include permissive use, but it is not guaranteed. Some insurers limit it, reduce coverage for unlisted drivers, or exclude it, especially on nonstandard or high-risk policies.

How often can someone borrow my car under permissive use?

Permissive use is meant for occasional borrowing. Most insurers use a guideline of fewer than 12 times a year, but the exact rule depends on your policy. If someone drives your car often, ask your insurer whether they need to be listed.

Will my insurance go up if a permissive driver crashes my car?

Yes, it can. If a permissive driver causes an accident in your car and your insurer pays a claim, the accident can affect your policy and future rates.

What should I do before lending my car?

Check your policy or call your insurer before lending your car. Ask whether permissive use is included, how often someone can borrow the car, whether limits are reduced, and whether any drivers are excluded.