Jeffrey P. Gale, P.A. // Avoid Getting Burned by “Non-Owned Vehicle” Language in Motor Vehicle Insurance Policy

car-insurance-policyMotor vehicle insurance companies are expert at finding ways of denying coverage under policies. The successful denial of coverage can leave the insured with significant burdens.

The successful denial of coverage in Geico Indemnity Co. v. Walker, Case No. 4D20-764 (Fla. 4th DCA May 12, 2021), is a cautionary tale for Floridians, as the circumstances underlying the denial are exceedingly common.

In Walker, the Geico insured was the driver in a single-vehicle crash that killed him and his passenger. The passenger’s estate filed a wrongful death action against the insured. Geico denied coverage under the driver’s policy because the subject vehicle was not a listed vehicle on its policy. With respect to the incident, Geico asserted that the subject vehicle did not meet the definition of an owned, non-owned, or temporary substitute vehicle.

Following Geico’s denial, the two estates entered into a settlement agreement whereby damages would be determined by arbitration and the driver’s estate would assign its right to sue Geico for breach of duty to defend and to indemnify. The arbitration resulted in an arbitration award of $7,722,150 in total damages for the passenger’s wrongful death claim against the driver.

The case we are discussing is the appeal from the passenger’s lawsuit against Geico facilitated by the assignment. At the trial court level, it was established that the vehicle operated by the Geico insured was a 1992 Porsche, made available to the driver by the owner, his stepfather, to use and take care of for ten years without specific restrictions. The Porsche was not listed under the Geico policy as an insured vehicle. Instead, the vehicle was listed in the stepfather’s automobile insurance policy with Allstate, which also listed the driver as an insured driver on that policy.

Both parties moved for summary judgment. Geico explained that its policy provided coverage for loss arising out of the ownership, maintenance, or use of the owned auto or a “non-owned auto.” The Geico policy defined “non-owned auto” as follows:

Non-owned auto means a private passenger, farm or utility auto or trailer not owned by, furnished or available for regular use of either you or your relative, other than a temporary substitute auto. An auto rented or leased for more than 30 days will be considered as furnished or available for regular use.

The Walker estate argued that the stepfather did not furnish or make the subject vehicle available for the driver’s regular use. It asserted that the subject vehicle, a 1992 Porsche, was a collector’s vehicle which the driver used infrequently and which the driver understood was not intended to be used regularly.

Ultimately, the trial court determined the subject vehicle qualified as a “non-owned auto” and therefore the Geico policy provided coverage for the subject vehicle involved in the accident. Geico appealed.

The appellate court focused on establishing the meaning of the phrase “not . . . furnished or available for regular use.” In deciding that the Porsche did not qualify as a “non-owned” vehicle, i.e., coverage was not afforded under the insurance policy, the court cited the following facts in support of its position:

[T]he stepfather’s testimony established that he gave the subject vehicle to the driver to use and take care of; that the driver had kept the subject vehicle for ten years; that the driver had his own set of keys to the vehicle; that the stepfather never restricted the driver’s use of the vehicle; that the driver had freedom to use it; and that how often the driver used the vehicle was left to the driver’s discretion.

The policy language at issue in the Walker case is common to most Florida motor vehicle insurance policies. While the facts in the case were unique, the language is broad enough to apply to many other scenarios. Consider the following: One of my children drives a fancy SUV. My wife likes to drive the vehicle and has her own key, and our daughter is generous in letting her use it when convenient, which is not often since she lives in another city 75 miles away. However, there could come a time when our daughter decides to move back home for an extended period of time. If this happened, my wife would have unrestricted use of the vehicle. The SUV is not listed on our motor vehicle insurance policy. If we didn’t list the vehicle in the policy and my wife got into a crash, our carrier might rely on the Walker case to deny coverage.

Insurance policies are contracts filled with consequential language. While case law and statutes may control some of a policy’s terms, for the most part the rights and duties of the insured and insurer are set forth in the policy. The language in Walker is a typical example. It was sitting there like a land mine waiting to be triggered. In Walker, the simple language cost the decedent’s estate, made up of her grieving family members, more than $7 million.



Contact us at 305-758-4900 or by email to learn your legal rights.

Jeffrey P. Gale, P.A. is a South Florida based law firm committed to the judicial system and to representing and obtaining justice for individuals – the poor, the injured, the forgotten, the voiceless, the defenseless and the damned, and to protecting the rights of such people from corporate and government oppression. We do not represent government, corporations or large business interests.

While prompt resolution of your legal matter is our goal, our approach is fundamentally different. Our clients are “people” and not “cases” or “files.” We take the time to build a relationship with our clients, realizing that only through meaningful interaction can we best serve their needs. In this manner, we have been able to best help those requiring legal representation.

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