There is exclusionary language in all insurance policies (as you know) that can operate to bar coverage. In a recent case example, a company performed maintenance and construction services and had a company automobile liability insurance policy. The policy, however, excluded from coverage automobiles where there was OTHER INSURANCE available that afforded SIMILAR COVERAGE. One of the company’s members got into an automobile accident with his personal vehicle which resulted in the company being sued in a personal injury action. The member had a personal automobile liability insurance policy that insured the vehicle. The company’s policy had significantly higher limits of insurance than the member’s policy.
Unfortunately, the Eleventh Circuit Court of Appeals held the company’s insurer was NOT required to defend or indemnify the insured-company in the personal injury action because of the exclusionary language in the company’s policy. In particular, the company’s policy did not apply because the member’s personal automobile liability insurance policy (other insurance) insured the same risk (afforded similar coverage); it did not matter that the limits of liability in the policies were different. (For more information on this case, click here.)
This case, although dealing with an automobile liability insurance policy, discusses exclusionary language in a policy that deals with other insurance available that provides the same or similar coverage (again, in this case the personal automobile liability insurance policy that covered the member’s vehicle applied which barred coverage under the company’s policy).
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