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A federal district court in Florida has ruled that an automobile insurance company did not have to cover a fatal auto accident involving a car rented by its insured but driven by someone else.

The Case

After Marlene D. Harmon rented a Hyundai from Enterprise Leasing Company of Florida, LLC, she allegedly permitted it to be driven by Steven Bruce Waldman, to whom she was not related. While driving the car, Mr. Waldman allegedly struck Tatiana Sanchez and Jose E. Gomez.

Allstate Insurance Company, which had issued an automobile insurance policy to Ms. Harmon, asked the U.S. District Court for the Southern District of Florida to declare that it had no duty to defend Ms. Harmon or Mr. Waldman against any claims asserted by Ms. Sanchez’s estate or by Mr. Gomez.

The Allstate Policy

The Allstate policy defined “you” and “your” as:

the policyholder named on the Policy Declarations and that policy holder’s resident spouse.

It also defined

insured person

to mean:

b. While using a non-owned auto,

(i) you,

(ii) any resident relative using a four wheel private passenger auto or utility auto

The policy excluded coverage for:

10. bodily injury or property damage arising out of the use of a non-owned auto, substitute auto or non-owned utility auto, being driven by someone other than you or a resident relative.

The District Court’s Decision

The district court granted Allstate’s motion.

In its decision, the district court explained that the Allstate policy did not cover any accidents arising out of the use of a non-owned (e.g., rented) vehicle being driven by someone other than the policyholder listed on the declarations page or a resident relative.

The district court noted that the Allstate policy did not define the word “policyholder.” It then ruled that it was clear that Ms. Harmon was the only policyholder, and the fact that Mr. Waldman was listed as a driver on the policy’s declarations page did not make him a policyholder. A listed driver, the district court said was not a policyholder.

The district court next found that policy exclusion 10 applied to exclude coverage for Ms. Harmon. The exclusion, the district court pointed out, excluded coverage for an accident involving a non-owned auto driven by someone other than the policyholder or the policyholder’s resident relative.

Both of those requirements were met in this case. First, the district court reasoned, the auto involved in the accident was a non-owned auto because it had been rented from and was owned by Enterprise. Second, the district court added, the auto was not being driven by the policyholder — Ms. Harmon — or a resident relative of Ms. Harmon but was being driven by Mr. Waldman, who was neither married to, nor a relative of, Ms. Harmon at the time of the accident.

The case is Allstate Ins. Co. v. Harmon, No. 17-23203-CIV-MORENO (S.D. Fla. March 21, 2018). Attorneys involved include: For Allstate Insurance Company, Plaintiff: David Bryan Shelton, LEAD ATTORNEY, Candy Lea Messersmith, Rumberger Kirk & Caldwell, Orlando, FL. For Anabel Alberni, as Personal Representative of the Estate of Tatiana Sanchez, deceased, Defendant: Andrew Needle, LEAD ATTORNEY, Needle & Ellenberg, P.A., Miami, FL.

Steven A. Meyerowitz, Esq., is the Director of FC&S Legal, the Editor-in-Chief of the Insurance Coverage Law Report, and the Founder and President of Meyerowitz Communications Inc. As FC&S Legal Director, Mr. Meyerowitz, a member of the team that conceptualized FC&S Legal, provides daily analysis and commentary on the most significant insurance coverage law decisions from courts across the country and news regarding legislative and regulatory developments. A graduate of Harvard Law School, Mr. Meyerowitz was an attorney at a prominent Wall Street law firm before founding Meyerowitz Communications Inc., a law firm marketing communications consulting company.