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Pennsylvania Appellate Court Upholds Insurer’s Ability to Limit Automobile Accident Defense to Named Driver On Insurance Policy

Loaning out your car to a friend or relative may seem like a natural thing to do to help them out during a move or an emergency.  One thing to keep in mind before a vehicle is loaned or borrowed is asking whether or not your auto insurance policy covers other drivers or other cars.  Accidents do not wait for the insured driver to be behind the wheel of their own vehicle, so it is important to know whether you or another affected party would be covered under a policy if an accident happens.    

Automobile Accident Lawyers

In Byoung v. Victoria Fire & Casualty Co., a man was injured in a car accident driven by someone other than the owner of the vehicle.  He filed suit against the driver for negligent operation and against the owner for negligently entrusting her car to the driver.  The car was insured, but the policy only provided liability coverage to named drivers on the policy.  The owner was the sole driver listed on the policy.  The injured person filed suit and sought a declaratory judgment from the trial court to affirm the insurance company had a duty to defend and indemnify both the owner and the driver.  The insurance company filed a motion for summary judgment, arguing the opposite:  that it had no duty to defend either the owner or the driver because of the specifically worded statement that it “will not provide coverage when the driver of your auto is not listed on the policy.”

The injured party filed a cross-motion for summary judgment, rebutting that this section of the insurance policy violates public policy, specifically the Motor Vehicle Financial Responsibility Law.  Section 1718(c) of the MVFRL addresses named driver exclusions.  This statute allows the insurer or the insured to exclude any person from benefits if they are excluded due to the writing, cancellation, or refusal to renew policies of automobile insurance.  It also allows for an exclusion by the first named insured if he or she specifically requests that a person be excluded from coverage while operating a motor vehicle and isn’t insured on another auto insurance policy. 

The court’s assessment of the policy included a review of the driver exclusion language.  The court agreed with the insurance company that the plain language of the contract limited the coverage to the driver only and did not deal with exclusions.  The court found the choice of limited coverage was made intentionally in exchange for the lower rates.  The court did not feel the section of the MVFRL statute that the injured person discussed applied to the insurance contract.  The court refused to rely on the injured person’s public policy argument, feeling it would contradict prior case law that dictates the interpretation of insurance contracts.  Case law does not favor broadening coverage beyond the plain language of the policy, and the court felt that it was explicitly exclusionary in this case.  The order in favor of the insurance company was affirmed.

The Needle Law Firm has the experience you need to pursue your Pennsylvania auto accident claim.  Our lawyer are familiar with the intricate nature of insurance policies, and we can help you maximize the money you recover on a claim.  For a free, confidential consultation, contact our office today at 570-344-1266.

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