Massachusetts Appellate Court Issues Ruling Interpreting Auto Insurance Policy Government Vehicle Exclusion Provision as Invalid

Everyone is susceptible to causing a motor vehicle accident if they fail to pay attention behind the wheel, including government employees. There are a number of different rules that apply to situations involving accidents with government employees, however, that are important for a victim to understand as early as possible. These rules may impact your case and will be a factor in determining the best route for securing the compensation or settlement that you deserve. Our seasoned Boston car accident lawyer Michael O. Smith is standing by to help you assess your potential lawsuit.

In a recent case, the Massachusetts Court of Appeal considered whether the Massachusetts Insurers Insolvency Fund (the Fund) was required to pay the victim of a motor vehicle accident where the car that caused the crash was owned by the government and driven by a government employee. The victim had a standard motor vehicle insurance policy that included uninsured motorist benefits.

In each of the consolidated cases in the action, the relevant insurance company denied the victim’s claim on the basis that a government vehicle is not considered an uninsured motorist under the policy, which is often referred to as a government vehicle exclusion. The victims each pursued compensation from The Fund, but the claims were also denied on the basis that G. L. c. 175D, section 9 required them to first exhaust their uninsured motorist policies.

The Fund and the insurance companies both filed actions seeking declaratory judgments and eventually filed cross motions for summary judgment. A declaratory judgment is an order from the court that provides a binding interpretation of a legal issue, such as how a contract should be interpreted. The lower court granted The Fund’s motion for summary judgment, denied the insurers’ motions for summary judgment, and the insurers appealed.

The appellate court ultimately upheld the lower court’s ruling on the basis that The Fund is a source of last resort and that the victims needed to exhaust the benefits available under their insurance policies before they could pursue compensation from the fund. The appellate court found a flaw in the language of the insurance policies and the government vehicle exclusion in particular, on the basis that it failed to distinguish between government vehicles that are self-insured and government vehicles that purchase policies from third-party insurers that can potentially become insolvent during the life cycle of the policy. To the extent the government vehicle exclusions conflicted with Massachusetts laws, the appellate court rendered them invalid.

If you were injured in a motor vehicle accident involving a government vehicle, it is critical for you to explore your potential legal right to compensation from the driver who caused the crash and his or her employer. We know that this process can be incredibly intimidating and that you are likely coping with painful injuries and serious disruption in your life. We provide a free consultation to help you learn more about your lead attorney and how our team of legal professionals may be able to assist you. To schedule your appointment, call us at 617-263-0060 or contact us online to get started.