Until Liability or Damages Are Determined, Any Declaration of Coverage or Policy Limits Would Be Advisory
Jennifer Gregory (Gregory) filed an amended complaint to the trial court asking for determination on whether the Farmers Automobile Insurance (Farmers) policy covered Ralph Wolf in an automobile accident. Gregory held a business automobile liability policy with Farmers. Previously, Gregory filed a wrongful death action against Ralph Wolf and Jeffery Wolf for negligent entrustment and negligence, respectively. While the tort action was pending, Farmers was providing the defense for under their automobile insurance policy that provided coverage for the automobile accident. The trial court granted summary judgment to Gregory. Count I and Count II of Gregory’s complaint requested a determination of whether the policy provided coverage for the automobile that Ralph Wolf was driving.
However, Farmers argued that such a decision would be premature because it would be premature to determine coverage before first determining liability. Additionally, Farmers filed a motion to dismiss Counts III and IV of the complaint and argued that Gregory did not have standing to assert a 215 ILCS 5/155 claim. The trial court denied Famer’s motion to dismiss Counts III and IV.
In granting Gregory’s motion for summary judgment on Count I and II, the court found that there was coverage for the automobile under the business automobile policy. Additionally, the court held that the business automobile coverage could be combined with the uninsured motorist coverage from the personal policy.
On de novo review, the appellate court noted that the issue was not yet ripe because the underlying tort action was still pending. Therefore, because the insured was not yet obligated to pay, there could not be a determination of Farmer’s duty to defend or indemnify the insured. The court held that “until the fact of liability or the amount of damages is determined in the underlying action, any declaration of coverage or policy limits would be advisory” Gregory v. Farmers, 392 Ill. App. 3d 159 at 162. In summary, the appellate court found that the trial court’s ruling on Counts I and II of Gregory’s complaint were premature because the issues were not yet ripe.
