Insured Location Meaning Clarified by Court
After an injured minor golf cart passenger and her mother brought a negligence action against the insured, the insurer brought a declaratory judgment action to determine coverage under the homeowners policy. This case is Elliott v. State Farm Florida Insurance Company, 61 So.3d 502 (2011).
The minor son of the insured was driving a golf cart on a private road within the Plantation at Sewall's Point community. The minor daughter of the claimant was a passenger on the golf cart and during the ride, she fell off and sustained injuries. A claim was filed against the Elliotts, the parents of the minor who was driving the golf cart. The homeowners insurer, State Farm, filed a declaratory judgment action seeking a determination of coverage under the Elliotts' homeowners policy.
The insurer argued that the accident took place outside of the insured premises and was not covered by the homeowners policy. The trial court agreed with the insurer and declared that the policy did not apply in this instance. This appeal followed.
The appeals court noted that the homeowners policy excluded from coverage any bodily injury arising out of the ownership or use of any motor vehicle, and that a golf cart was considered a motor vehicle while off an insured location. In addition, the policy defined the insured location as the residence premises and any premises used by the named insured in connection with the premises. The main thrust of the claimant's argument was that the private street within the development where the accident occurred constituted an insured location since the definition of that term in the policy included any premises used in connection with the premises. The insurer countered that the roads and common areas within the development were owned by the Sewall's Point Plantation Homeowners Association. Therefore, the accident took place on land owned by the homeowners association and this was not an insured location within the meaning of the policy language.
The court stated that it was persuaded by case law and the plain language of the homeowners policy that the trial court correctly entered a declaratory judgment on behalf of the insurer. The court decided that the accident took place on a private road owned by the homeowners association and that the association was responsible for the common maintenance of the road. The Elliotts in this case could not control, alter, or restrict the use of the road in any fashion, and where the individual homeowner exercised no individual control over the road, that road cannot be part of the insured premises.
The view that the road was used regularly in connection with the residence premises and, was thus included in the definition, was rejected by the court. The court said that to view the road in this way would render the definition of insured location meaningless and provide no discernible geographical limit to coverage. The golf cart accident took place approximately one-and-a-half to three blocks away from the insured premises on a private road within a gated community. To accept the legal principle that the private road located blocks away from the insured location was used in connection with the insured location, as a roadway in and out of the community, could effectively make all roads within all gated communities covered locations used in connection with the insured location. The court found this interpretation to be untenable.
Editor's Note: It is interesting that the standard ISO homeowners policy has a motor vehicle liability exclusion that states the exclusion does not apply to a motorized golf cart that is owned by an insured, and at the time of an occurrence is within the legal boundaries of “a private residential community, including its public roads upon which a motorized golf cart can legally travel, which is subject to the authority of a property owners association and contains an insured's residence”. Obviously, the insured in this instance did not have such wording in his homeowners policy. Policy language does have consequences.