North Carolina wants insurers to help foster youth get behind the wheel – and the state is willing to pay for it.
Senate Bill 905, filed on April 29, 2026, by Senators Vickie Sawyer and Dana Jones as primary sponsors and Senator Mujtaba Mohammed, would direct the North Carolina Rate Bureau to amend its named driver exclusion endorsement to better serve persons receiving foster care. It would also create a state-funded program to subsidize the cost of auto insurance for that population, backed by a $1,000,000 appropriation.
The bill addresses a gap in how foster youth access motor vehicle liability coverage. Under current law, a foster parent's auto policy can exclude a foster child from coverage, provided that child carries separate insurance meeting the state's minimum liability limits. The new legislation keeps that framework in place but broadens the language – replacing "foster children" with "person receiving foster care" as defined under state law – and attaches new conditions to the endorsement itself.
Three requirements stand out for insurers. The endorsement must be available to any person who received foster care during the coverage period. It cannot withhold coverage simply because the foster youth lives in a household that already has a motor vehicle liability policy. And it must provide coverage for the person's operation of any nonfleet passenger motor vehicle furnished or available for their regular use.
The bill also gives foster parents a clear off-ramp. If the vehicle owner no longer provides foster care for the child, they may terminate the endorsement without running afoul of the state's financial responsibility statutes.
On the product development side, the legislation tasks the Rate Bureau with creating an optional policy form or endorsement for named non-owner nonfleet private passenger motor vehicle liability coverage for persons in foster care. That filing must land on the Commissioner of Insurance's desk no later than October 1, 2026 – a timeline that insurers operating in the state will want to note.
The bill's most notable feature, however, is the Foster Care Automobile Insurance Financial Assistance Program, to be administered by the Department of Health and Human Services in consultation with the Commissioner. The program would reimburse foster parents for the premium increase caused by adding a foster youth to their existing policy, cover the premium cost of a non-owner's policy issued directly to a person in foster care, and pay all or part of an applicable deductible – capped at $1,000 – for claims arising from the foster youth's operation of a vehicle.
There is a catch. To qualify for financial assistance, the person receiving foster care must have completed a drivers education program approved by the State Superintendent of Public Instruction, whether through a public high school, a nonpublic secondary school, or a licensed driving school.
The effective dates are staggered. The endorsement and policy form provisions take effect as soon as the bill becomes law. The financial assistance program kicks in on July 1, 2026. The remainder of the act becomes effective January 1, 2027, and applies to policies issued or renewed on or after that date.
The bill is currently in the introduced stage and has not yet been referred to committee.
