August 15, 2016
The underinsured motorist (UIM) carrier brought an action against the insured for a declaratory judgment that the policy excluded coverage since the insured was driving his cross utility vehicle that was not a covered auto as defined in the policy. This case is Progressive Preferred Insurance Company v. Reece, 2016 WL 3176482.
Reece owned and operated a 2012 John Deere 855-D cross utility vehicle and was driving it down the highway. He hand-signaled a left turn and was turning when Askren attempted to pass in her Chrysler Sebring. The Askren vehicle collided with the left rear corner of the cross utility vehicle, causing injury to Reece. Reece was offered $50,000, the liability limit on the Askren vehicle; his injuries were in excess of $150,000.
Reece asserted a claim against his auto insurer for UIM benefits. Progressive denied coverage, noting that the policy does not identify the cross utility vehicle as a covered auto. The Progressive policy excluded coverage for any person while using or occupying a motor vehicle that is owned by the named insured, except for a covered auto. The insurer filed a declaratory judgment action asserting that there is no coverage for Reece's injuries under the UIM section of the policy. The trial court granted Progressive's motion for summary judgment and this appeal followed.
The Missouri Court of Appeals for the Western District noted that the policy does not define “motor vehicle” and that the cross utility vehicle is not an auto or a covered auto as those terms are defined in the policy. Progressive argued that the cross utility vehicle falls within the unambiguous definition of motor vehicle as it is usually used, and the policy clearly excluded an owned motor vehicle that was not also a covered auto. Reece countered that the term is ambiguous and that a reasonable person of ordinary intelligence would infer the meaning of motor vehicle to be the same as that of an auto, that is a land motor vehicle of the private passenger type designed for use on public roads. Since the cross utility vehicle was not a private passenger vehicle and was not designed for use principally on public roads, the cross utility vehicle was not a motor vehicle and coverage is not excluded.
The court said that the term “motor vehicle” is defined in the dictionary as an automotive vehicle not operated on rails for use on highways. And, automotive means containing within itself the means of propulsion. A vehicle is defined as a means of carrying or transporting something. Thus, said the court, the plain and ordinary definition of motor vehicle is a self-propelled carrier of goods or passengers or a self-propelled piece of mechanized equipment. Under the stipulated facts in this case, the cross utility vehicle is one that is powered by a diesel engine and is equipped with seat belts. It is self-propelled by a motor and it is a carrier of goods or passengers. An ordinary person of average understanding purchasing insurance would thus believe the cross utility vehicle is a motor vehicle.
The court ruled that the cross utility vehicle is a motor vehicle under the UIM coverage exclusion and barred UIM coverage for Reece. The decision of the trial court was affirmed.
Editor's Note: The Missouri Court of Appeals holds that the cross utility vehicle was a motor vehicle within the meaning of the exclusion. The court noted that self-propulsion was a key ingredient to a motor vehicle, and if the terms “motor vehicle”, “automotive”, and “vehicle” are ordinarily defined, the average reasonable person would believe that the cross utility vehicle was a motor vehicle. The UIM exclusion clearly applied to motor vehicles owned by the named insured but not listed as a covered auto and so, the insurer was correct in denying UIM benefits to the insured.