Fether v. GEICO Indemnity Company

Summary

The United States District Court for the Middle District of Florida held that Florida’s Financial Responsibility Law invalidated a family-owned-auto exclusion in GEICO’s policy. The court granted Darcie Fether’s motion for summary judgment on the breach-of-contract claim, denied GEICO’s motion for summary judgment, and denied GEICO’s motion to dismiss as moot. The court concluded that GEICO was obligated to provide coverage for liability arising from David Heffron’s use of his mother’s vehicle.

Holdings

1. Florida's Financial Responsibility Law voids and renders ineffective the GEICO policy's family-owned-auto exclusion because the exclusion conflicts with the statutory requirement to cover liability arising from the named insured's use of a motor vehicle not owned by the named insured.
2. GEICO breached the insurance contract as a matter of law by failing to pay the policy's $100,000 bodily-injury limit for liability arising from David's use of the Audi.
3. Allstate's partial payment for the injuries did not discharge GEICO's contractual and statutory obligation to cover liability arising from David's use of the Audi.

Questions Presented

1. Whether Florida's Financial Responsibility Law invalidates a family-owned-auto exclusion in a policy issued to reinstate a driver's license when the insured is liable for injuries caused by the use of a vehicle owned by a household relative.
2. Whether GEICO breached the insurance contract by refusing to provide the policy's $100,000 bodily-injury coverage.
3. Whether the existence of partial coverage under a separate Allstate policy relieved GEICO of its contractual and statutory coverage obligation.

Disposition

other