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Regularly Used Non-Owned Vehicle Exclusion Upheld

November 3rd, 2017

In Reeves v. Travelers, 2017 WL 4930900, (E.D. Pa., 10/31/17), the Eastern District Court upheld the “regularly used, non-owned vehicle” exclusion contained in Traveler’s automobile insurance policy.  In this case, Reeves worked in the City of Philadelphia Street Lighting Department and was injured while a passenger in a work truck.  At the time of his injury, Reeves owned a 2006 Mercury Mariner, which was insured by Travelers.  The Traveler’s policy contained a “regularly used, non-owned vehicle” exclusion that provided,

We do not provide Uninsured Motorists Coverage or Underinsured Motorists Coverage for ‘bodily injury’ sustained:

  1.  By you while ‘occupying’ or when struck by, any motor vehicle you own or that is furnished or available for your regular use which is not insured for this coverage under this policy ….

Reeves made a claim for underinsured motorist benefits under the Traveler’s policy.  Travelers denied Reeves’ claim based on its “regularly used non-owned vehicle” exclusion.  The city Street Lighting Department had 17 vehicles of various types, but Reeves was only allowed to drive three of them because he lacked a CDL license.  In addition, he did not use the same vehicle every day, and was assigned a truck depending on the type of work he had to do.  He only drove about 10% of the time, and was a passenger 90% of the time.  Reeves argued that the regularly used, non-owned vehicle exception should not apply to him under these circumstances.  The court recognized that this exclusion can effectively eliminate underinsured motorist coverage for employees who are in work vehicles most of the work day, but refused to re-write a “valid, enforceable, unambiguous contract.”

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