Safe Auto's Unlisted Resident Driver Exclusion Upheld as Valid by Pennsylvania Supreme Court

In the case of Safe Auto Insurance Co. v. Oriental-Guillermo, 26 MAP 2018 (Pa. Aug. 20, 2019)(Op. by Todd, J.)(Wecht, J., Concurring), the Pennsylvania Supreme Court affirmed the Superior Court's decision upholding the validity of Safe Auto's Unlisted Resident Driver Exclusion.

Under this exclusion, Safe Auto excluded from coverage under its policy those individuals who resided with the Safe Auto insured, but who was not related to the insured and who were not listed on the Safe Auto policy as additional drivers.

The Supreme Court agreed that this insurance contract provision was not ambiguous, did not violate Pennsylvania's Motor Vehicle Financial Responsibility Law, and did not violate Pennsylvania's public policy.

To review Justice Todd's Majority Opinion, please click HERE,

To review Justice Wecht's Concurring Opinion, please click HERE.

Pennsylvania Supreme Court Agrees to Review the Validity of Unlisted Resident Driver Exclusions in Automobile Policies

In an Order handed down yesterday in the case of Safe Auto Ins. Co. v. Oriental-Guillermo, No. 791 MAL 2017 (Pa. June 4, 2018), the Pennsylvania Supreme Court agreed to look at the validity of unlisted resident driver exclusions in automobile insurance policies.  To paraphrase, the court agreed to decide the following issues:  

(1)  Did the Superior Court err in upholding the “unlisted resident driver exclusion” in a personal auto policy as valid and enforceable and not in conflict with the MVFRL; and 

(2)  Is the “unlisted resident driver exclusion” inherently in conflict with public policy in Pennsylvania as embodied in Section 1786 of the MVFRL, which implicitly allows for permissive users of an insured vehicle to also be considered insureds under the owner’s policy?

Click HERE to view the Supreme Court's Order.

 

I send thanks to Attorney Scott Cooper of the Harrisburg, PA office of Schmidt Kramer for bringing this case to my attention.

Pennsylvania Superior Court Upholds Exclusion of Coverage for Resident Non-Family Members Not Listed On Auto Policy

In the case of Safe Auto Insurance v. Oriental-Guillermo, 2017 Pa. Super. 297 (Pa. Super. Sept. 18, 2017) (Dubow, J., Solano, J., and Ford Elliot, P.J.E) (Majority Op. by Dubow, J.) (Dissenting Op. by Ford Elliot, P.J.E.), the Pennsylvania Superior Court ruled that a automobile insurance policy issued by Safe Auto that excluded coverage for non-family members who live with the vehicle owner but who were not specifically included under the policy is enforceable under Pennsylvania’s Motor Vehicle Financial Responsibility Law.  

The panel essentially ruled that the policy was consistent with the MVFRL because that statute places the burden of making sure a driver is insured on the vehicle owner, and not upon the insurance companies.

The court rejected the Plaintiff’s argument that Safe Auto’s provision violated the mandate of the MVFRL of having an owner ensure that all drivers are covered by insurance.   The court noted that the MVFRL does not require a shifting of the burden to the insurance companies to discover the identities of resident, non-family member insureds who may have access to an insured’s vehicle.  

 

Rather, the court felt that that burden was more appropriately placed in the hands of the insured.  

 

 

The Majority Opinion written by Judge Dubow can be viewed HERE.

The Dissenting Opinion by Judge Ford Elliott can be viewed HERE.


Source: Article “Superior Court Rules Unlisted Resident Driver Exclusion is Okay” by Max Mitchell. The Legal Intelligencer (September 22, 2017).