In Rawl v. GEICO, 11435-CV-2019 (C.P. Beaver Co. 7/1/19), the Beaver County Trial Court granted summary judgment in favor of the insurance carrier after hearing cross motions in a declaratory judgment action. The Court held that the regular use exclusion applied when an employee sought UIM coverage from his own policy while operating a rental vehicle provided by his employer.
In Rawl, the Plaintiff was involved in an accident and after obtaining liability limits from the tortfeasor, made a claim for UIM benefits from GEICO. Plaintiff’s policy contained a clause indicating that when an insured is “using a motor vehicle furnished for the regular use of you, your spouse or a relative who resides in your household which is not insured under the policy, coverage is excluded.” At the time of the accident, the Plaintiff was operating a Dodge Ram rented from Enterprise Rent-A-Car by his employer because Plaintiff’s regular work vehicle was out of service. The Dodge Ram was insured by Traveler’s Insurance, who did provide UIM benefits to Plaintiff, but Plaintiff sought additional UIM coverage from his own GEICO policy. GEICO denied coverage based on the regular use exclusion in Plaintiff’s policy, asserting that the rental van was a temporary substitute vehicle for Plaintiff’s normal work van.
The parties agreed via stipulation that the rental van was not part of the regular fleet of vehicles owned by Plaintiff’s employer, it was only picked up two days before the accident, and the Plaintiff had not operated the van previously. Plaintiff argued that the van qualified as a temporary substitute under the policy and that since he had not operated the vehicle before, it did not fall within the definition of a vehicle available for his regular use. GEICO argued that the vehicle was a substitute vehicle and available for Plaintiff’s regular use. GEICO further asserted that the fact Plaintiff only operated the vehicle once or twice was irrelevant.
In deciding that the regular use exclusion was applicable, the Court relied on the seminal cases of Rother v. Erie, 57 A.3d 116 (Pa. Super. 2012), Prudential Prop. v. Hinson, 277 F. Supp.2d 468 (2003) and Crum and Forster v. Traveler’s Corp., 631 A.2d 671 (Pa. Super. 1993). The Court also cited Brink v. Erie Ins.Group., 940 A.2d 538 (Pa. Super. 2008) in which a police officer brought an action against his own insurance company when involved in an accident operating a fleet vehicle.
In applying the regular use exclusion, Court determined that the Plaintiff had a vehicle available to him, and that the rental vehicle from Enterprise was a replacement vehicle. The Court rejected the argument that the van was not “regularly used” because it was used less than 30 days. In addition, the Court cited Burnstein v. Prudential Prop., 809 A.2d (Pa. 2002), holding that regular use exclusion clauses promote the cost containment policy of the MVFRL and “function to prevent an insurance company from being subjected to an additional risk of coverage for a vehicle for which the insurance company did not receive a premium or intend to insure.
Questions regarding this opinion can be directed to Jennifer L. Stauffer, Esquire
