In Reeves v. The Travelers Co. the United States District Court for the Eastern District of Pennsylvania evaluated whether the “regular use exception” applied. The regular use exception excludes coverage for bodily injuries sustained while occupying or when struck by any motor vehicle a person owns or that is furnished or available for regular use, but that vehicle is not insured under the same policy.

Plaintiff was injured when he was hit by another driver as he was driving his employer’s truck as he regularly did to a work site. After settling a personal injury claim against the other driver, he sought to claim underinsured motorist benefits from his mother’s personal insurer, Travelers. Travelers denied coverage to Plaintiff, invoking the regular use exception. Plaintiff filed suit alleging breach of contract and bad faith in handling his claim and Travelers filed a motion for summary judgment.

In Plaintiff’s opposition, he argued that the regular use exception should not apply in his case because he performed his core duties outside of the truck in which he was riding and was only allowed to drive three out of the seventeen employer’s vehicles. The Court determined that the “regular use exception” was often applied where an insured was traveling to a job site where work would be performed outside of the vehicle, as well as to passengers as well as drivers of non-owned vehicles.

The Court ruled that the terms of the policy were valid, enforceable, and unambiguous; and therefore, found that Travelers properly denied coverage for Plaintiff’s accident and was not in breach of contract. The Court also ruled that there was no basis for finding that Travelers acted in bad faith as it investigated and denied Plaintiff’s claim on the basis of a reasonable reading of the Policy and applicable law within four weeks of being notified of the claim.

Thanks to Chelsea Rendelman for her contribution to this post and please write to Mike Bono with any questions.