Regular Use Exclusion Found To Be Enforceable and Applicable

In the case of Valiga v. Erie Insurance Co., No. 2021-CV-339 (C.P. Mercer Co. Oct. 7, 2024McEwin, J.), the trial court in Mercer County granted summary judgment to a carrier in a regular use case.

According to the Opinion, the Plaintiff was an individual whose job it was to ferry vehicles across the country. The record indicated that the Plaintiff would only use each vehicle one time. As such, the Plaintiff claimed that he was not regularly using a vehicle in the same context as set forth in the regular use exclusion under the policy in question.

After reviewing the language of the regular use exclusion at issue along with the current status of Pennsylvania law regarding the continuing validity of those types of exclusions, the court ruled that the purpose of the regular use exclusion is to prevent policy holders from habitually using vehicles not covered under their policy and thereby exposing insurance companies to additional liabilities unbeknownst to the insurance companies.

In other words, insureds should only get the coverage that they paid for.  If an insured is regularly using a vehicle not covered by the policy at issue and unbeknownst to that insurance carrier, then the insurance carrier should not have to provide the coverage.   

Judge McEwin confirmed that, in reviewing regular use cases, the courts do not concern their analysis to whether a particular vehicle has been used by the injured party before, but rather, whether the insured was regularly and habitually increasing potential liabilities under the policy by utilizing uncovered vehicles on a regular basis.

Here, where the injured party was in the business of transporting vehicles to purchasers after their sale, it was readily apparent that the injured party was regularly using vehicles that were not covered under the insurance company’s policy.

Accordingly, the court ruled that requiring the insurance company to pay benefits to the injured party that were beyond the scope of the policy’s coverage would be in violation of the regular use exclusion in that policy. 

Finding that the injured party in this case habitually and regularly transported vehicles that were not covered under the policy, and that the Plaintiff was injured while driving one of those uncovered vehicles, the court ruled that the regular use exclusion applied irrespective of the frequency of the use of each individual vehicle. 

As such, summary judgment was granted in favor of the insurance company.

Anyone wishing to review a copy of this decision may click this LINK.

I send thanks to Attorney Joseph Hudock of the Pittsburgh law firm of Summers, McDonnell, Hudock, Guthrie & Rauch, P.C.