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Insurer thinks strangers are driving my car


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Question: My car insurance company contacted me and asked me to sign a document that excludes two individuals from my policy. I've never heard of these people, much less know them personally. I refused to sign for the simple reason that I don't want my name associated with people I don't know. My insurer has now threatened to not renew my policy. In 25 years of driving, this is the first for me. Where do they get this information from? Should I start looking for another insurance company? 

Answer: You’re probably wondering where the insurance company is even coming up with names of people you’ve never met to add, or exclude, from your policy. 

To find out for certain where your auto insurer came up with these two names, you’ll have to ask it directly, but likely the names showed up on one of the reports the company pulled to verify the data it has on you.

Car insurance companies use various resources to make certain they have accurate information on you when determining your rates at the beginning of a policy or at renewal time -- and one is an undisclosed driver report. This report may come as part of the claim history report, motor vehicle report or VIN report; it just depends what company your auto insurer uses to obtain these reports. 

For instance, LexisNexis provides insurance companies with the C.L.U.E. claims report and also offers an additional driver discovery (A.D.D.) report. 

The A.D.D. report lists potential additional drivers in a household who may not have been disclosed by the insurance applicant or policyholder.  LexisNexis also offers a youthful driver discovery (Y.D.D.) report that alerts auto insurance providers to the fact that a newly licensed youth (between the age of 15 and 25) is residing at a certain address and may not have been disclosed.

There is also Insurance Services Office (ISO), which offers underwriting reports to auto insurance companies.  These reports include Motor Vehicle Records (MVRs), credit scoring, claims history, and undisclosed driver information.  The ISO undisclosed driver report identifies hidden drivers not listed on an application or policy.

Likely the individuals you’ve never heard of showed up on such a report, and since you are saying these people don’t live with you, and, in fact, that you don’t know them, your insurance company wants to make sure you’re telling the truth by having you sign a named driver exclusion form with these people listed on it.

Excluding people from your policy means that the listed parties wouldn’t be covered in any way by your policy if they did operate your car.  

While excluding people you don’t know may seem silly to you, to your insurer it proves that either you really don’t know these people or that you can’t get away without listing them and letting them drive your car for free – because they wouldn’t be covered.

I’d recommend getting an answer from your car insurance company on why it believes these individuals are associated with you.  If they're listed on a report that other insurers may also pull, then it's in your best interest to try and get the data corrected so you don’t continually have this issue.

Go ahead then and comparison shop for the cheapest auto insurance rates. You may find by changing insurers you can save hundreds of dollars -- and it’s just as well that you’re ready to leave your current car insurance provider.

Just remember, if you change providers, be sure that the new policy is in effect before canceling your current one.  Even a one-day lapse of coverage can get you penalized in some states.

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