Please advise if the "racing" exclusion would apply to this scenario. I've attached the policy. In summary:
AUTO PHYSICAL DAMAGE COVERAGES
LIMITATIONS ON OUR DUTY TO PAY
What We Do Not Cover - Exclusions
We will not pay for loss:
9. to any owned auto while:
b. being used in an organized racing or demolition contest or in any stunting activity or preparation for any of these.
FACTS:
We have an insured who was allowed to take his own vehicle onto a race track to drive. The specific program was: http://www.mvptracktime.com/
The insured had a customer invite him to this venue, and that customer was in the passenger seat. The venue did require participants to wear helmets. They drove the private passenger auto on the racetrack. There was no timing of their drive. They were not in competition with any other party. Nobody driving on the track was allowed to compete or even pass any other party without the vehicle in front waiving for them to do so. The insured was not experiencing this recreational situation with any intent of getting into racing.
Would this exclusion apply to these set of facts?
This is an interesting question. The term race is not defined in the policy; courts turn to a standard desk reference when terms are not defined. Merriam-Webster defines racing as: the sport or profession of engaging in or holding races. On the other hand, race is defined several ways, including to compete in a race or to go, move, or function at top speed or out of control. This last definition is important - in looking at the information for mvptracktime, while there may not be any winners and drivers are coached along the way, specific racing helmets are required, specific clothes are recommended in case of fire, drivers are to drive with the windows open in case of an accident, and the overall nature of the experience is akin to racing. While it is a racing/speed environment, there was no timing or attempt to beat other drivers. So while the vehicle was on a track, as there was no actual race, no timing of drivers, the insured was not engaged in racing or preparing for a race.
Morton v. Gov't Emples. Ins. Co., 2019 U.S. Dist. LEXIS 169202 (S.D. Fla. 2019)is very similar to this situation - an insured drove his personal vehicle on a track at high speeds at an event designed to improve driving skills. The vehicle caught fire after it was parked and the insured filed a claim, which the insurer denied. The court found that since there are no races, no timing of drivers and lap speeds being recorded, that the exclusion for racing, speed or demolition contest or stunting activity did not apply. There should be coverage.