When it comes to auto insurance, understanding the difference between named insured, named drivers, non-rated drivers, permissive drivers, and excluded drivers is crucial for avoiding claim denials and policy violations. The named insured is the policyholder responsible for premiums, claims, and coverage changes, while named drivers share full coverage but can’t make changes. Non-rated drivers have their own insurance and won’t affect your premiums.

Adding drivers to your policy can impact your premium rates. Insurers may offer cheaper premiums by limiting coverage to named drivers. Non-rated drivers won’t affect your premiums and usually have their own insurance. Permissive drivers, like friends borrowing your car occasionally, are usually not included in your rate calculations.

Excluded drivers are household members explicitly not covered by your policy. If they drive your car and get into an accident, your insurance won’t cover it unless they stole the car. Removing a driver from your policy is different and allows occasional driving. Some states restrict driver exclusions to ensure coverage for all drivers.

Insurers typically require you to have an insurable interest in the vehicle you insure, but non-owner auto insurance policies provide liability coverage for vehicles you don’t own. Understanding the difference between named insured and insured drivers is essential. If your partner drives your car and gets in an accident, your insurance may cover it, but having them listed as a named driver is crucial to avoid claim denials.

Read more at Yahoo Finance: What is a named insured driver?