Definition of “Spouse” under Personal Automobile Insurance Policy is Clear and Unambiguous

In Gaudina v. State Farm Mutual Automobile Insurance, Robert Gaudina (“Gaudina”) was injured in an automobile accident while working as a limousine driver. After settling his bodily injury liability claim against the other driver for the driver’s policy limit, Gaudina filed an underinsured motorist claim with State Farm under his wife’s automobile insurance policy. State Farm denied coverage of the claim on the grounds that Gaudina was not an insured at the time of the accident, he was not residing primarily with her, and he therefore did not fit the definition of her spouse as set forth in the policy. The policy defines spouse as “your husband or wife who resides primarily with you.” Gaudina filed a declaratory judgment action against State Farm seeking a declaration that he was, in fact, an insured entitled to coverage of his claim under his wife’s policy.

The court reviewed whether the word spouse in the policy was ambiguous.

Gaudina contends that the term “spouse” should be given its “universally understood meaning,” instead of the meaning provided by the definition in the policy. Gaudina argues that a reasonable person would understand “spouse” to mean a husband or wife, without the caveat that the spouse must reside primarily with the insured, and thus would not be on notice of State Farm’s definition. Gaudina also asserts that the definition of “spouse” is ambiguous because it does not specify the relevant time frame for determining whether he primarily resided with the insured.

State Farm contends that the definition of “spouse” is clear and unambiguous; the definition was set forth in the policy and emphasized by bold, italicized print; and a person who accepts a policy is deemed to know its contents. Further, courts in other jurisdictions have found the phrase “primarily resides with you” in insurance contracts to be unambiguous and enforceable.

A determination of whether Gaudina was a “spouse” under the policy should be made by referring to the circumstances as they existed at the time of the accident giving rise to Gaudina’s claim. Therefore, the policy’s definition of “spouse” was not ambiguous with respect to the relevant time frame for determining whether a person qualifies as a “spouse,” and therefore an insured under the policy.

Under Illinois law, whether a person is a “resident” of a household is a function of a person’s intent, physical presence, and permanency of abode. While a person may have several residences, he or she can have only one domicile, or permanent abode, at a time. As stated, Gaudina cannot reside primarily in multiple places at the same time.

Gaudina v. State Farm Mut. Auto. Ins. Co., 2014 IL App (1st) 131264.