Automobile Insurance Coverage, Regular Use
MacLearn v. Commerce Insurance Company , No. 2010 - 880 (NH Supreme Court)
(Decided January 27, 2012)
The petitioner, MacLearn, was involved in an automobile accident while driving a Toyota Prius owned by his wife and insured under a policy issued by GEICO. At the time of the accident, MacLearn owned an Audi A6 that was insured under a policy issued by Commerce. The injured party sued MacLearn, who sought liability coverage for the claims under his Commerce policy.
Commerce denied any obligation to provide liability coverage for the accident, relying on an exclusion which provided:
B. We do not provide Liability Coverage for the ownership, maintenance or use of:
2. Any vehicle, other than "your covered auto", which is:
a. Owned by you; or
b. Furnished for your regular use.
The policy defined "your covered auto" as "Any vehicle shown in the Declarations" and defined "you" and "your" as: 1) The named insured shown in the Declarations; and 2) The spouse if a resident of the same household.
Since the Prius was owned by MacLearn's spouse and was not listed on the policy, Commerce denied any obligation to defend or indemnify MacLearn. The trial court granted summary judgment in favor of Commerce.
The Court held that the policy exclusion (B.2) was unambiguous and that it served to prevent an insured from purchasing a policy to insure against the risk of operating one vehicle while at the same time obtaining coverage for another vehicle that is regularly used in the household but not listed as an insured vehicle under the policy. MacLearn argued that the words "you" and "your" as used in the exclusion must be read to refer to either MacLearn or Mrs. MacLearn exclusively and, therefore, since he did not own or regularly use the Prius the exclusion did not apply. The Court rejected that argument, ruling that MacLearn and his spouse could be substituted in the exclusion alternatively for "you" and "your". Since the vehicle was owned by "you" [MacLearn's wife] and furnished for "your" [MacLearn's wife] regular use, and was not "your [MacLearn's] covered auto", the exclusion applied.
Although MacLearn argued that an exception to another exclusion (B.3), applicable to vehicles owned by a "family member", supported a finding of coverage, the Court declined to address the argument because that exception applied to a different exclusion not relied on by Commerce. Since Exclusion B.2 barred coverage, no further analysis was required.
Stephen J. Schulthess