Ambiguous Provisions in a Policy

A motorcycle (driven by brother) and an ATV (driven by father with his son as a passenger) collided. The driver of the motorcycle suffered head injuries. Both the motorcycle and ATV were covered under an insurance policy from Progressive. Additionally, the policy also covered another motorcycle. The limits of liability section in the policy provided that limits shown for a vehicle may not be combined with the limits for the same coverage on another vehicle.

This situation, where two covered vehicles were in the same accident, is one of first impression for the court. The trial court found that the policy addressing this particular issue was ambiguous and should be resolved in favor of coverage. Progressive argued on appeal that the policy was not ambiguous in the provision limiting coverage to one vehicle. The insured argues that he is entitled to receive coverage up to the policy limits for each vehicle involved in the accident.

The court found that the declarations page of the policy stated that coverage for one vehicle may not be combined with the same coverage for another. Therefore it is irrelevant that the language appears on the declarations page rather than in the body of the policy. However, it must be carefully noted that this is not a traditional stacking case (where the insured seeks to aggregate coverage from an additional covered vehicle that is not involved in the accident). The policy was found to be clear in the anti-stacking provision. However, the court found the policy ambiguous as to the application of the stacking provision to covered vehicles involved in the same accident. The court found that the bodily injury limits to each vehicle involved in the accident are available.  Construing the policy in favor of coverage, the policy holder was awarded coverage up to the policy limit for each of the vehicles involved in the accident.