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October 2017 
Thomas L. Mueller 
Lucas and Cavalier, LLC  

The Pennsylvania Superior Court held an automobile insurance policy that excluded coverage for non-family members who live with the policyholder but are not specifically named as insureds is enforceable under the Pennsylvania Motor Vehicle Financial Responsibility Law (MVFRL).

In Safe Auto Insurance Company v. Oriental-Guillermo, 2017 Pa. Super. 297 (Sept. 18, 2017), Rachel Dixon and another driver were involved in a motor vehicle accident.  Dixon was driving a car owned by her boyfriend, Rene Oriental-Guillermo (the “Policyholder”), who insured his car through Safe Auto.  Among the Safe Auto policy exclusions was an Unlisted Resident Driver Exclusion, which excluded from coverage any individual living with the Policyholder but not related to the Policyholder nor listed on the policy as a driver.

Priscila Jimenez was the passenger in the other vehicle and filed a personal injury lawsuit against Dixon, Policyholder, and the driver of the vehicle in which Jimenez was a passenger.  Safe Auto filed a declaratory judgment action seeking to enforce the Unlisted Resident Driver Exclusion.  The Court of Common Pleas of Lehigh County, Pennsylvania granted Safe Auto’s Motion for Summary Judgment, and Appellants, Jimenez and her husband, appealed.

The Safe Auto policy in question specifically provided as follows:


1. That occurs while your covered auto is being operated by a resident of your household or by a regular user of your covered auto, unless that person is listed as an additional driver on the Declarations page ....

The Superior Court agreed with the trial court’s finding the Unlisted Driver Exclusion was unambiguous.  There was no dispute Dixon lived with Policyholder, was unrelated to him, and was not listed on the policy as an additional driver.  Accordingly, the exclusion applied. 

Appellants also argued the Unlisted Resident Driver Exclusion violated the language of the MVFRL and public policy and was unenforceable.  Contrary to Appellants’ arguments, the Superior Court noted the MVFRL actually places the onus on vehicle owners, not the insurance company, to ensure that anyone driving the vehicle has insurance.  The court held: “there is no provision in the MVFRL that indicates that the legislature, when it enacted the MVFRL, intended to shift the risk to insurance companies to insure unidentified individuals who live with the insured, but are not related to the insured.”   

The Superior Court further disagreed with Appellants’ argument that the public policy behind the Named Party Exclusion provided for in the MVFRL is that the insurance company must provide coverage for every person who drives an insured’s vehicle unless the insured specifically asks the insurer not to provide coverage for that driver.  To the contrary, the court concluded the Named Driver Exclusion and the Unlisted Resident Driver Exclusion had similar policy implications, to wit, “the insured, in certain circumstances, determines those drivers of the insured’s car for which the insured will purchase insurance.  If the insured chooses not to purchase insurance for those drivers of his car, the insurance company is not required to provide insurance.”

In the end, the Superior Court appeared to determine the settled public policy goal of the MVFRL to encourage vehicle owners to obtain proper insurance coverage for themselves and people they anticipate will operate their vehicles outweighs the goal of maximum feasible restoration to accident victims.  Appellants’ argument would have shifted the burden to insurance companies to discover the identities of resident, non-family member insureds who have access to an insured’s vehicle.  Such an outcome would contravene the policy goals of the MVFRL.

            The attorneys at LUCAS AND CAVALIER, LLC are well-versed in issues surrounding the application of the MVFRL and are able to answer any questions arising from this decision. 

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