Who's driving? Denver man finds mystery driver on his Progressive insurance policy

Ed Fan, a 31-year-old financial analyst in Denver, is single, lives alone and says he is the only person who has access to and drives his 2019 Jeep Wrangler. So he was surprised when his insurance company, Progressive, recently informed him that they were increasing his six month premium by $312 for another driver in his home, who Fan says does not exist.

"I have no idea" who the supposed new driver was, said Fan. "I am the only driver on my vehicle," he said.

He repeatedly called and emailed Progressive, trying to get them to remove the charges -- and the unknown person -- from his auto insurance policy.

"It does appear the burden falls on me to prove this person doesn't exist and is not related to me or drives my vehicle," said Fan, who said he was caught off guard by Progressive's assertions that he had to pay for another licensed driver in his home, driving his Jeep.

"I didn't even know they could to that," he said.

 
On message boards and internet forums, some auto owners who said they were insured by Progressive have complained in recent years of the same thing; random names being added to their policies along with higher premiums, associated with these "phantom drivers."

On one online legal forum, one person wrote, "Progressive add my ex husband, my brother, my God daughter and son that I have no contact with for more than a year to my policy and added $1700.00 additional fee to my policy without my consent."

In another post on a different site, a commenter said, "Progressive added some random person to my auto policy. I literally have no idea who (this person) is," wrote the commenter. "I noticed my coverage for my 2014 Kia Sorrento shot up to over $1k for a 6 month term. How in the hell does this happen?"

Yet another commented, "I just found out Progressive added a person to my policy that I have never heard of. I live alone. Not married. There is no one in my house but me."

Bruce Swicker, an insurance broker in New York state, said what happened to Ed Fan and other insured drivers is likely the result of faulty data obtained by auto insurance companies through what is known as additional driver discovery, or A.D.D.

"It's not unusual," said Swicker. "I don't know that I could call it common," he said.

Insurance companies contract with third party companies who try to find "undisclosed drivers" in homes by searching DMV databases and other data sources.

"If they are in the household," said Swicker, "the assumption is that at some point since they have access to the vehicle that they may very well drive it."

He said A.D.D searches cross-reference known addresses with car registrations, DMV records, drivers licenses "and anything else," said Swicker. But he said when people move, they frequently forget to update their address on drivers licenses or registrations.

"Information being what it is today, we have tons and tons of information and every once in awhile that information is wrong."

These hidden or unrecognized drivers lead to what the insurance industry calls "premium leakage," costing the insurance industry an estimated $10 billion annually. So finding hidden drivers through A.D.D. searches is a priority for the industry.

"There are certainly times the A.D.D. report is in error for any number of reasons," said Swicker.

After weeks of back and forth with Progressive, and filing a complaint with state insurance regulators, Progressive had Ed Fan sign a statement that he did not know the person who supposedly lived with him and might be driving his car. Progressive then dropped the additional premium charge. But in a statement to CBS News Colorado, Progressive did not specify where their information about a 'hidden driver' in Fan's house came from or why that name was added to his policy. The company did not address other, similar complaints CBS News Colorado shared with the company. Ron Davis, with Progressive Insurance's public relations division, instead reiterated the companies' procedures for insurance applicants.

"...We also regularly review information from third-party sources about individuals who possibly live in the household and should be added to active policies," wrote Davis. "When information is found, we contact the policyholder to verify the information. Identifying potential missing driving-age household members/drivers and working with the customer is important."

Fan says from this experience, he has learned to closely examine his insurance policy and statements.

"I do recommend people check their policies and make sure nobody else is on there that they don't know of."

Swicker, the insurance broker, suggested that drivers who discover an unknown driver on their policies should contact their insurance agent or broker. If they don't have one but contact their insurance company, he said consumers should keep meticulous records of who they talk to at their insurance company.