Excluded Driver – No Coverage After a Car Accident
If the driver who caused your car accident was an excluded driver under the insurance policy, then there will likely be no coverage for the crash. This can leave injured victims without compensation unless there is another available avenue of insurance. Understanding what an excluded driver is — and how it affects your right to recovery — is crucial after a serious accident.
An auto insurance policy is a contract between the policyholder and the insurance company. In that agreement, the insurer promises to defend and pay claims for covered drivers up to the policy limits. However, every policy also includes limitations and exclusions, and one of the most common is the “excluded driver” clause.
When someone applies for insurance, they are required to list all household members or anyone who regularly drives the vehicle. The policyholder can then choose to exclude certain individuals from coverage. This might happen if a person has a poor driving record, prior DUI, suspended license, or is considered a high-risk driver who would raise the premium. The exclusion must be in writing and signed by the policyholder. Once an excluded driver is named, the insurance company is no longer responsible for defending or paying any claims caused by that person.
For example, imagine a parent excludes their adult child from their policy because the child has multiple prior accidents. If that child later borrows the family car without permission and causes a serious collision, the insurance company can deny coverage entirely — both for property damage and personal injury. This means that even if you were seriously injured, you may not be able to recover from the car owner’s insurance policy.
However, there may still be a legal path to recovery. If the vehicle owner knew or should have known that the excluded driver was likely to take or use the car — and failed to take reasonable steps to prevent it — the owner could potentially be sued for negligent entrustment. Negligent entrustment occurs when someone allows or enables another person who is unfit, reckless, or unlicensed to use their vehicle, and that person causes harm. While the insurance company may deny coverage for the excluded driver, the vehicle owner’s insurance policy could still be pursued under a negligent entrustment theory.
It’s also important to verify any claimed exclusion. Insurance companies sometimes assert that a driver was excluded when the paperwork doesn’t fully support it. Always demand a copy of the signed exclusion form from the insurer. Without a valid, signed exclusion agreement, the insurance company may still owe a duty to defend and provide coverage under Texas law.
There are some exceptions and gray areas. If the excluded driver was never clearly told they were excluded, or if they had a reasonable belief of permission to drive, coverage disputes can arise. Additionally, if the excluded driver is treated as an uninsured motorist, you may still be able to make a claim under your own uninsured/underinsured motorist (UM/UIM) coverage.
Because these cases often involve complex policy language and multiple potential claims, having an experienced personal injury attorney is essential. An attorney can review all available policies, confirm whether the exclusion was valid, and explore other avenues for recovery — including negligent entrustment, UM/UIM coverage, or additional liability sources.
If you’ve been injured by an excluded driver, do not assume that you are without options. A skilled Texas personal injury attorney can investigate the policy details, challenge improper denials, and fight to recover the compensation you deserve.
