An agency insures a husband and wife. The husband contacts the agency to request that they remove the wife, who is a named insured, from the personal auto policy.
The couple currently lives in the same household and all vehicles are titled in the husband's name. The husband requests a form for the wife to sign, which would remove her as a named insured but keep her listed as a driver.
Q: What is our responsibility to the wife in this situation?
Response 1: Do not fulfill this request. Explain to the husband that legally, you cannot comply with such a request without a copy of a final divorce decree from a court.
Response 2: What does the husband hope to accomplish by doing this? For the sake of protecting not only your insured but your errors & omissions exposure, do not agree to this request. When insuring married couples, both spouses should be named insureds on all policies, regardless of who the home is deeded to, who has the mortgage or who owns the car.
In almost all personal policies, the named insured becomes “you” and has more rights and coverage than simply an “insured” under the policy. The ISO PAP in particular automatically considers a resident spouse “you,” even if they are not named in the declarations, but the key here is resident spouse. If the wife leaves the husband, her status as “you” would end, and she would lose rights and coverage under the policy.
Response 3: I would not remove her without asking why. Then you may be able to determine if the issue could be dealt with in a different manner. If the husband still insists, I would have both parties sign a letter detailing the decision, then notarize it.
Response 4: You need the wife’s permission to remove her from the PAP. You can’t reduce coverage without the permission of all named insureds. Although, even if she is no longer a named insured, she would still be insured under the ISO PAP as long as she resides with her husband.
Regardless, your insured should not be giving you coverage advice. Removing the wife as a named insured does not reduce the husband’s premium, but it could reduce coverage. Is your E&O premium paid up?
Response 5: As a named insured, the wife must be the one to authorize the change. Do they understand doing this potentially reduces her coverage?
Response 6: Since they are married, the wife owns the vehicles. It makes no difference who registered the auto—as a married couple, they both legally own the vehicle. Removing the wife as a named insured will not change the "who is an insured" provision, which includes the named insured and their resident spouse.
This question was originally submitted by an agent through the VU’s Ask an Expert Service, with responses curated from multiple VU faculty members. Answers to other coverage questions are available on the VU website. If you need help accessing the website, request login information.