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COA: Insurance policy not contrary to code

Jennifer Nelson
January 1, 2008
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A minimum-coverage insurance company's policy language that excludes coverage for leased vehicles in certain circumstances isn't contrary to Indiana Code, the Court of Appeals ruled today.

In the appeal of Safe Auto Insurance Co. v. Enterprise Leasing Company of Indianapolis, et al., No. 01A02-0712-CV-1120, the Court of Appeals reversed the trial court's grant of summary judgment in favor of Enterprise Leasing on Safe Auto Insurance's complaint for declaratory judgment. Safe Auto filed the complaint arguing its policyholder, Jeffrey Harrison, was not driving a covered vehicle when he was involved in an accident with a car he leased from Enterprise, and as a result, he has no coverage under Safe Auto's policy.

The trial court agreed with Enterprise's argument that Harrison's Safe Auto policy coverage for leased vehicles - which only granted liability coverage on a rented car when Harrison's vehicle was being serviced, repaired, stolen, or destroyed - was contrary to Indiana Code Section 27-8-9-9. That statute states in part, "When a claim arises from the operation of a motor vehicle leased under a written lease agreement, if under the agreement the lessee agrees to provide coverage for damage resulting from his operation of the vehicle, then the motor vehicle insurance coverage of the lessee is primary."

Harrison rented a truck from Enterprise to drive to Virginia because he didn't think his own car was dependable enough for the road trip. When he signed the rental agreement, he declined to purchase supplemental liability protection and never provided written proof of insurance coverage for the rented truck. While in Virginia, he was in an accident, which injured those in the other car.

Safe Auto filed a complaint for declaratory relief in Adams County, requesting a judgment that there is no coverage under the Safe Auto policy and the company doesn't have a duty to defend or indemnify Harrison for the accident.

Harrison didn't have coverage under his policy for the truck because the reason he rented wasn't one of the circumstances under which Safe Auto would provide him coverage on a leased vehicle, wrote Judge Paul Mathias.

Harrison's Safe Auto policy involving lease coverage doesn't conflict with I.C. Section 27-8-9-9 because this section only applies when the lessee agrees to provide insurance coverage. Because Harrison never agreed in writing to provide insurance himself for the truck and believed Enterprise would provide the insurance, the statute isn't applicable to this case, wrote the judge.

Even if the section applied, Safe Auto's policy isn't unenforceable because the policy language doesn't run afoul of the plain language of the statute and there is no law that requires insurance companies to provide coverage for vehicles leased by their insureds for any reason.

The Court of Appeals reversed the trial court's ruling and remanded.
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  1. Someone off their meds? C'mon John, it is called the politics of Empire. Get with the program, will ya? How can we build one world under secularist ideals without breaking a few eggs? Of course, once it is fully built, is the American public who will feel the deadly grip of the velvet glove. One cannot lay down with dogs without getting fleas. The cup of wrath is nearly full, John Smith, nearly full. Oops, there I go, almost sounding as alarmist as Smith. Guess he and I both need to listen to this again: https://www.youtube.com/watch?v=CRnQ65J02XA

  2. Charles Rice was one of the greatest of the so-called great generation in America. I was privileged to count him among my mentors. He stood firm for Christ and Christ's Church in the Spirit of Thomas More, always quick to be a good servant of the King, but always God's first. I had Rice come speak to 700 in Fort Wayne as Obama took office. Rice was concerned that this rise of aggressive secularism and militant Islam were dual threats to Christendom,er, please forgive, I meant to say "Western Civilization". RIP Charlie. You are safe at home.

  3. It's a big fat black mark against the US that they radicalized a lot of these Afghan jihadis in the 80s to fight the soviets and then when they predictably got around to biting the hand that fed them, the US had to invade their homelands, install a bunch of corrupt drug kingpins and kleptocrats, take these guys and torture the hell out of them. Why for example did the US have to sodomize them? Dubya said "they hate us for our freedoms!" Here, try some of that freedom whether you like it or not!!! Now they got even more reasons to hate us-- lets just keep bombing the crap out of their populations, installing more puppet regimes, arming one faction against another, etc etc etc.... the US is becoming a monster. No wonder they hate us. Here's my modest recommendation. How about we follow "Just War" theory in the future. St Augustine had it right. How about we treat these obvious prisoners of war according to the Geneva convention instead of torturing them in sadistic and perverted ways.

  4. As usual, John is "spot-on." The subtle but poignant points he makes are numerous and warrant reflection by mediators and users. Oh but were it so simple.

  5. ACLU. Way to step up against the police state. I see a lot of things from the ACLU I don't like but this one is a gold star in its column.... instead of fighting it the authorities should apologize and back off.

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