What is a named operator policy?
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UPDATED: May 12, 2022
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- Two kinds of named operator car insurance policies are named driver and non-owner
- Most auto insurance companies will not offer named operator policies
- A named operator policy costs less than a standard car insurance policy, but unnamed drivers who use your vehicle assume a significant risk
What is a named operator policy, and how does it differ from a standard auto insurance policy? In addition, can a named operator insurance policy include more than one driver? Named operator car insurance is a specialized type of auto insurance that only covers named drivers. And there are generally two types of this insurance.
There are a few reasons for you to purchase an operator insurance policy. For example, this type of policy is beneficial if you do not own a car. Also, you may only want to insure people whom you know will use your vehicle.
Should you purchase an operator insurance policy? It depends on your situation. Read on if you would like to know more about named operator car insurance, including what and who it covers.
What does a named operator car insurance policy cover?
It depends on who you want to insure because you have two options for private operator insurance.
Named Operator Policy
If you want to cover the people listed on a policy and no one else, a named driver policy might be best for you. Whereas a standard policy may temporarily cover unlisted drivers who borrow a policyholder’s car under permissive use, named driver auto insurance only applies to all persons named on a policy.
For example, you can add GAP insurance or rental car reimbursement coverage to a named driver policy as you would with a standard one. But if an unnamed driver uses your vehicle and gets into an accident, your policy will not cover that driver or any damage to your car.
Alternatively, you can purchase a non-owner car insurance policy. Non-owner car insurance is an operator’s insurance policy because it only applies to you, but it has more limitations.
If you can purchase non-owner auto insurance, you will only have two types of liability car insurance — one for bodily injury and one for property damage. In most states, you only need to meet a minimum requirement for liability insurance, but your named operator policy can include different types of coverage.
Depending on your state and insurance company, your named operator policy might include the following coverages:
- Uninsured motorist protection (UM). This coverage acts like an at-fault driver’s liability coverage if you get into an accident.
- Underinsured motorist protection (UIM). This fills the gaps when the other driver has low liability limits compared to the damage you suffer.
- Medical payments coverage (MedPay). This protection helps pay your, any family members’, and your passengers’ medical expenses in the event of a car accident.
- Personal injury protection (PIP). This coverage acts much like MedPay, but it might cover more, like lost wages and death benefits.
Remember that a non-owner policy does not include collision or comprehensive car insurance. Such a limited policy only follows the driver, not the car.
Which companies offer named operator insurance?
And how much does this type of policy cost?
Most car insurance companies will not offer named operator policies, and the companies that sell this type of insurance do not openly advertise it. Here are some companies that may sell nonstandard insurance:
|Company||Named Driver Policy||Non-Owner Policy|
|Direct Auto Insurance||$1,902.65||$773.81|
Also, when selecting a company that offers a named operator policy, ensure that you meet your state’s minimum insurance requirements.
Minimum Liability Insurance Requirements
These are the state requirements for liability car insurance:
|States||Minimum Liability Limit Requirements|
|District of Columbia||25/50/10|
If your state requires uninsured motorist coverage, that insurance has the same limits as your liability auto insurance.
Minimum PIP Requirements
Below, you will find minimum requirements for states that allow personal injury protection:
|State||Is PIP Required?||Minimum PIP Requirements|
|Delaware||Yes||$15,000 per person; $30,000 per accident; $5,000 for funeral expenses|
|District of Columbia||No||N/A|
|Florida||Yes||$10,000 per person|
|Hawaii||Yes||$10,000 per person|
|Kansas||Yes||$4,500 for medical costs, per person; $4,500 for rehabilitation costs; $2,000 for funeral costs; $900/month for one year for lost wages and disability; $25 per day for in-home services|
|Kentucky||Yes||$10,000 per person|
|Maryland||Yes||$2,500 per person|
|Massachusetts||Yes||$8,000 per person|
|Minnesota||Yes||$20,000 for medical expenses; $20,000 to cover lost wages|
|New Jersey||Yes||$15,000 per person; Up to $250,000 in disability (for severe or permanent injury)|
|New York||Yes||$50,000 per person|
|North Dakota||Yes||$30,000 per person|
|Oregon||Yes||$15,000 per person|
|Pennsylvania||Yes||$5,000 per person|
|Puerto Rico||Yes||Medical payments, payments for injury or death|
|Texas||Yes||$2,500 per person|
|Utah||Yes||$3,000 per person; $1,500 for funeral expenses, per person; $3,000 for survivor benefits; $250 per week or 85% of lost wages (whichever is less); 20$ per day for replacement services|
|Washington||No||$10,000 per person|
Read more about personal injury protection before purchasing this coverage.
Is a named operator car insurance policy right for you?
As you can see, there are limitations with a named operator policy. While you might save money with either type, this insurance only protects the named drivers on a policy.
A named driver policy can list multiple drivers and costs less than a standard policy. On the other hand, an unnamed driver who uses your car is at risk.
For example, if you have a medical emergency, an unnamed driver who takes you to a hospital will not have coverage, even if it’s permissive use. Also, your auto insurance company will not pay any claims if your car incurs damage in a related crash.
A non-owner insurance policy only covers one driver, but it does not pay for damages to any vehicle you drive. On the other hand, it may be your only option if you do not own a car but often need to borrow and rent vehicles.
If you must buy a named operator policy, it may be challenging for you to find a company that offers them in your state and to compare rates. You may need to locate smaller, local companies that sell named operator policies or speak with an agent to acquire a policy that suits your needs.
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