United Services Automobile Association v. Neary

[INSURANCE LAW]

In United Services Automobile Association v. Neary,[1] the supreme court held that the number of insureds does not affect an explicit per-occurrence policy limit.[2] While handling his father’s gun a minor accidently shot two friends with a single bullet, killing one and injuring the other.[3] The parents of the victims sued the minor, his parents and their insurer, United Services Automobile Association (“USAA”).[4] The parents’ plan, which covered themselves and their son, included a limit of liability provision that limited the coverage of each occurrence to $300,000.[5] The policy further stated that the total liability for USAA under the plan resulting from any one occurrence would not be greater than that limit regardless of the number of insureds.[6] The lower court held that each of the insureds were subject to an independent per-occurrence limit, resulting in potential liability of up to $900,000 for USAA.[7] On appeal, USAA argued that the per-occurrence limit was not dependent on the number of insureds.[8] The supreme court reversed the lower court’s decision, reasoning that while ambiguities should be construed in favor of the insured, the language of this policy was clear and unambiguous.[9] Reversing the lower court’s decision, the supreme court held that the number of insureds does not affect an explicit per-occurrence policy limit.[10]

 

 



[1] 307 P.3d 907 (Alaska 2013).

[2] Id. at 910.

[3] Id. at 909.

[4] Id.

[5] Id.

[6] Id.

[7] Id. at 910.

[8] Id.

[9] Id. at 910–11.

[10] Id. at 910.

United Services Automobile Association v. Neary

[INSURANCE LAW]

In United Services Automobile Association v. Neary,[1] the supreme court held that the number of insureds does not affect an explicit per-occurrence policy limit.[2] While handling his father’s gun a minor accidently shot two friends with a single bullet, killing one and injuring the other.[3] The parents of the victims sued the minor, his parents and their insurer, United Services Automobile Association (“USAA”).[4] The parents’ plan, which covered themselves and their son, included a limit of liability provision that limited the coverage of each occurrence to $300,000.[5] The policy further stated that the total liability for USAA under the plan resulting from any one occurrence would not be greater than that limit regardless of the number of insureds.[6] The lower court held that each of the insureds were subject to an independent per-occurrence limit, resulting in potential liability of up to $900,000 for USAA.[7] On appeal, USAA argued that the per-occurrence limit was not dependent on the number of insureds.[8] The supreme court reversed the lower court’s decision, reasoning that while ambiguities should be construed in favor of the insured, the language of this policy was clear and unambiguous.[9] Reversing the lower court’s decision, the supreme court held that the number of insureds does not affect an explicit per-occurrence policy limit.[10]

 

 



[1] 307 P.3d 907 (Alaska 2013).

[2] Id. at 910.

[3] Id. at 909.

[4] Id.

[5] Id.

[6] Id.

[7] Id. at 910.

[8] Id.

[9] Id. at 910–11.

[10] Id. at 910.