The person who caused the accident had only $50,000 in coverage. So, Mr. Dixon asked his Pennsylvania insurance company to honor their promise of underinsured motorist coverage. GEICO refused to pay their insured, claiming that the “regularly used auto” exclusion in their policy let them off the hook.
The “regularly used auto” exclusion is an exclusion unknown to most people outside of the insurance and legal industries. Most Pennsylvania insurance companies put it in their policies so that they don’t have to pay if their insureds are hurt while “…using a motor vehicle furnished for the regular use of you, your spouse, or a relative who resides in your household, which is not insured…” under the relevant policy. This exclusion usually hurts people who either have a car provided through their employer or who have a relative living with them who insures their own vehicle on a separate policy.
Mr. Dixon was working for the United States Postal Service as a garage man. He had various duties, including washing trucks, light maintenance and transporting vehicles. On the day of the accident, he was delivering a USPS vehicle. This was not a vehicle Mr. Dixon had driven before. Indeed, most of his job duties did not involve the use of a vehicle and the USPS did not provide Mr. Dixon with a vehicle for his use as a matter of routine.
Still, GEICO tried to get out of providing their insured with his promised underinsured motorist coverage.
Fortunately, Mr. Dixon went to an experienced Pennsylvania injury lawyer who challenged GEICO’s use of the exclusion. The Superior Court ruled on July 29, 2010 that the regularly used auto exclusion may not apply to Mr. Dixon. The Court ruled that the mere incidental use of a vehicle is not enough to allow an insurance company to deny coverage on the basis of the regularly used auto exclusion. The Superior Court directed that the case go back to the trial level for further proceedings between Mr. Dixon and GEICO.
It’s too bad that Mr. Dixon has had to fight to such an extreme just to get the benefits he paid for from GEICO. Unfortunately, stories like this one are surprising only to people who aren’t familiar with the way insurance companies operate. For those of us who have been representing injured people it’s just another example of what insurance companies will sometimes do to their own insureds in order to save a few bucks.