Let $p>3$ and consider a prime power $q=p^h$. We completely characterize permutation polynomials of $\mathbb{F}_{q^2}$ of the type $f_{a,b}(X) = X(1 + aX^{q(q-1)} + bX^{2(q-1)}) \in \mathbb{F}_{q^2}[X]$. In particular, using connections with algebraic curves over finite fields, we show that the already known sufficient conditions are also necessary.