Consumers should be weary of letting other people drive their vehicles. It is important to understand that coverage does not always transfer to permissive use operators at the same limits that are listed on the policy.
In California many auto insurance companies offer what is known as reduced limits for permissive use drivers. With policies that have these stipulations, if the insured were to let another person use their vehicle, often times in the event of an accident the coverage will be reduced to the state minimum coverage. In California the state minimum is $15,000 per person for bodily injury, $30,000 per occurrence, and $5,000 property damage protection.
With the state minimum coverage so low, many times policy holders purchase policies that offer a significantly higher. A common limit for bodily injury in California would be $100,000 per person for bodily injury. Although the consumer has chosen the higher protection while they and the other stated drivers are operating the vehicle, if permissive user were to use the vehicle and be involved in an accident the insurance company would default the coverage provided to the coverage stated in the insuring agreement.
It is important for consumers to understand the coverage on their auto insurance policy and how this permissive use coverage is stated on their policy in particular. Not all insurance companies offer the same coverage and the stipulations of coverage will vary from company to company. Some insurance companies that offer the reduced coverage will also offer for the client the ability to endorse the coverage for equal limits of permissive use.
