“Named Insured”, “Authorized Driver”, and “Covered Vehicle”: What’s the Difference?
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The general concept
A named insured, an authorized driver, and a covered vehicle are different things. The named insured is the person identified in the policy declarations. A covered vehicle is a vehicle the policy insures, often identified by year, make, model, or VIN. An authorized or permissive driver is someone allowed to use a covered vehicle. A driver may qualify for some coverage without being named on the policy, and being allowed to drive does not automatically make that person a named insured.
How Maryland applies it
Maryland law defines “named insured” as the person identified in the declarations of a motor vehicle liability policy. Liability coverage may also extend to a permissive user under the policy’s omnibus clause, but the wording and scope of permission matter. In Payne v. Erie Insurance Exchange, the Supreme Court of Maryland explained that the clause can cover certain second permittees, while holding that the driver in that case was not covered when the named insured had expressly forbidden that person from driving and the first permittee was not present. PIP is broader in some respects: subject to statutory waivers, exclusions, and policy terms, Maryland law includes the first named insured and resident family members, people injured while using the insured vehicle with the named insured’s express or implied permission, occupants, and certain pedestrians. A listed driver may be rated or identified on the policy without being a named insured. Likewise, permission to drive one insured car does not necessarily cover another car, and a vehicle described as covered may be subject to provisions for newly acquired, replacement, or temporary substitute vehicles. Check the declarations and the specific coverage part—liability, PIP, uninsured motorist, collision, or comprehensive—because each can define insured persons and vehicles differently.
Related Maryland Cases and Authorities
Md. Code, Insurance §§ 19-501(d) and 19-505; Swartzbaugh v. Encompass Insurance Co. of America, 425 Md. 614 (2012); Payne v. Erie Insurance Exchange, 442 Md. 384 (2015).