The Pennsylvania Supreme Court recently, and unanimously, ruled that an “Unregistered Driver Exclusion” in automobile insurance policies does NOT violate the Pennsylvania Law — or public policy.

In Safe Auto Insurance v. Oriental-Guillermo, authored by Supreme Court Justice Debra Todd, the Pennsylvania Supreme Court held:

“In the instant case, the policy contains a clear and unambiguous [unregistered driver exclusion], which excludes coverage for injury or property damage that occurred while policyholder’s vehicle was operated by a resident of his household or by a regular user of his covered vehicle, unless that person is listed as an additional driver on the declarations page. . . .Policyholder had the option of adding his girlfriend to the policy, but chose not to do so. Undoubtedly, this choice resulted in reduced insurance premiums, and as we have previously stated, an insured is not entitled to receive gratis coverage. Moreover, in the absence of provisions in the Motor Vehicle Financial Responsibility Law to the contrary, insurers are not compelled to underwrite unknown and uncompensated risks. Thus, we decline to hold that the [unregistered driver exclusion] in this case is contrary to public policy.”

So what does this mean for consumers?

You need to be certain that all members of your household, and anyone who regularly use your vehicles, are identified on your automobile insurance policy as insureds or, at a minimum, “additional drivers”.

What if you don’t do it? Well, if your automobile insurance policy has “clear and unambiguous” language excluding coverage for unregistered drivers, that driver may not be covered if your vehicle is in a collision. And you could be subject to uninsured liability.

It is a big deal. Make sure you are covered.

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