Summary
The Arkansas Supreme Court affirmed summary judgment for Progressive Classic Insurance Company in a dispute over uninsured-motorist benefits. The court held that the policy’s named-driver exclusion was clear and unambiguous and excluded coverage for claims arising while the excluded driver operated the vehicle. The court also held that the statutory written-rejection requirement was not effective when the exclusion was signed and concluded that the exclusion did not violate Arkansas public policy.
Topics
Practice areas
Questions Presented
- Whether the policy's named-driver exclusion was ambiguous because it did not expressly identify uninsured-motorist coverage.
- Whether the exclusion conflicted with Arkansas's uninsured-motorist statute by operating as a rejection of uninsured-motorist coverage without a specific written rejection.
- Whether the policy's named-driver exclusion violated Arkansas public policy.
- Whether summary judgment was proper on the undisputed facts.
Holdings
- The named-driver exclusion was clear and unambiguous and excluded coverage for any claim arising from an accident or loss involving the vehicle while it was operated by the excluded driver, including Castaneda's uninsured-motorist claim.
- Castaneda's argument that Progressive was required to obtain a specific written rejection of uninsured-motorist coverage was meritless because the 2001 statutory amendment requiring a written rejection was not effective when she signed the exclusion.
- The court would not consider Castaneda's argument that the named-driver exclusion conflicted internally with the uninsured-motorist coverage provision because she did not raise that argument below.
- Named-driver exclusions generally do not violate Arkansas public policy, and the circuit court's enforcement of the exclusion was affirmed.
Key quotations
“The exclusion indicates that any claim arising from operation of the vehicle by the excluded driver at the time of the accident or loss is not covered.” (561)
“In general, named-driver exclusions do not violate public policy in Arkansas.” (563)
Factual background
On August 6, 2001, Dora Castaneda was injured as a passenger when an uninsured driver rear-ended the automobile in which she was riding. Her son Aaron Castaneda was driving, and Aaron was expressly identified in Castaneda's Progressive policy as an excluded driver. Progressive denied uninsured-motorist benefits because the policy excluded any claim arising from an accident occurring while a covered vehicle was operated by the excluded driver.
Procedural history
Castaneda sued Progressive in Benton County Circuit Court for $25,000 in uninsured-motorist benefits after Progressive denied her claim under a named-driver exclusion. The circuit court granted Progressive summary judgment, concluding that the policy was plain and unambiguous and that the exclusion did not violate public policy. The Arkansas Court of Appeals affirmed, and the Arkansas Supreme Court granted Castaneda's petition for review and affirmed the circuit court's judgment.