Insurer obtains cancellation in Montana truck accident

A policy exclusion still applies, even if the policy itself fails to meet technical requirements such as including a table of contents, a federal appeals court ruled Wednesday, reversing a decision by a lower court.

The case involves Belgrade, Montana-based High Country Paving Inc., which purchased liability insurance from United Fire & Casualty Co. that included commercial motor vehicle liability coverage, commercial umbrella coverage, and liability coverage. commercial general civil, according to court documents in High Country Paving, Inc. v. United Fire & Casualty Co.

In August 2016, a High-Country employee was driving a company truck and trailer when the trailer detached and struck another vehicle, killing the driver and injuring the passenger.

In settling the resulting claims, United Fire paid the combined $3 million limits of the commercial automobile and umbrella policies, but denied coverage under the CGL policy based on an exclusion. aircraft, automobile or personal watercraft and a Limitation of Multiple Liability Coverage Endorsement.

United Fire argued that the aircraft, automobile or watercraft exclusion applied because the injuries resulted from the use of a vehicle towing a loaded equipment trailer and therefore arose from the use of a automobile.

In the ensuing litigation, the U.S. District Court in Missoula, Montana ruled in favor of High Country, finding that while its insurance policy “unambiguously” excluded coverage, the exclusions were unenforceable under Montana law.

The 9th Circuit has asked the Montana Supreme Court to consider whether, if an insurance policy does not include a table of contents or a notice of material provisions in violation of state code, the insurer can still s rely on unambiguous exclusions or limitations to the policy. cover

In an April 12 ruling, the Montana Supreme Court agreed that exclusions could still be invoked “where, as here, ‘the invalidation of such a provision would result in an increase in the risk assumed’.”

Citing that ruling, a three-judge panel of the appeals court overturned the lower court’s decision, saying the aircraft, automobile or boat exclusions “are therefore both unambiguous and enforceable.”

Lawyers handling the case did not respond to requests for comment.

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