Car insurance policies and corresponding law can be confusing. In the event of a crash, sorting out who was covered, what type of coverage applies and the exact amount can be dependent on a host of factors that are best examined by an experienced injury attorney.
In the recent case of Allstate v. Rolon, an insurer successfully won an appeal to have the case diverted to arbitration, per the policy provisions, while another was successfully joined to the action, despite protestations that the at-fault driver lacked permission by owner to operate the vehicle.
It was a two-vehicle crash, with the driver and passenger of one car seeking coverage not only from the driver’s insurer, but also from insurer covering the vehicle driven by the allegedly at-fault driver.
The first issue to be resolved was one of arbitration. The New York County Supreme Court, Appellate Division, First Department, agreed the case should be permanently stayed to arbitration, per the request of the insurer. However, the court also agreed to allow a second insurance company to be joined to that action.
As our New York City personal injury lawyers note, the second insurer sought to bar coverage by asserting the the driver did not have the vehicle owner’s permission to operate the vehicle at the time of the crash. This would have made coverage void.
However, the court found the insurer failed to provide any supporting evidence of its assertion. There was no affidavit from the vehicle owner attesting to this fact, and there was no police theft report that would prove this point either. For this reason, the court found, plaintiffs were entitled to seek relief from the second insurer as well – albeit in the forum of arbitration (as opposed to in a civil court).
This case highlights an important point of insurance law, which is that car insurance often follows the vehicle – not the driver. Liability insurance is different – it follows the driver, meaning the driver will be covered for damages so long as he or she is lawfully operating the vehicle. However, many other policies cover the auto.
The reason is that many people have driver’s licenses, but don’t own a vehicle or have insurance coverage in their own name. That could leave a lot of people unable collect damages (or relying heavily on uninsured motorist coverage) if policies didn’t generally follow the vehicle.
This means vehicle owners have to be very careful to whom they lend their car, lest they find themselves named in a liability lawsuit. In general, if you give someone permission to drive your vehicle, that person is going to be covered under your vehicle’s insurance. It’s called permissive use.
One exception is if the driver did not have permission to drive the vehicle. However, the burden of proof will be on the insurer to show the driver did not have permission. As this court noted, that could be in the form of a sworn affidavit from the insured or from an auto theft police report.
There are a number of other exceptions that fall under “permissive use” provisions of car insurance policies, and some may be of direct consequence to an injured driver, passenger or pedestrian. That’s why it’s so important to consult with an injury lawyer with extensive experience.
The Law Offices of Nicholas Rose, PLLC offers free consultations. Call 1-877-313-7673.
Allstate v. Rolon, Sept. 23, 2014, New York County, Appellate Division, First Department
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Barney-Yeboah v. Metro-North Commuter R.R. – New York City Train Injury Weighed by Appeals Court, Sept. 18, 2014, New York City Car Accident Lawyer Blog