Elardo, Bragg, Appel & Rossi

GL is Not Auto

Jackson v. Nationwide Mutual Insurance Company, 228 Ariz. 197, 265 P.3d 379 (App. Div. 2 2011)

After Jackson agreed to allow an employee of a Chevron repair station to show him how to drive his car with its mechanical problems, the car was hit by an uninsured motorist. Chevron had two Nationwide policies issued by the same agent at the same time as part of the same transaction: a Business Auto Policy (“BAP”) containing an uninsured motorist (“UM”) endorsement and a Business Owner’s Policy (“BOP”), a commercial general liability (“CGL”) policy with an endorsement providing liability coverage for bodily injury and property damage caused when an insured under the policy was operating a customer’s automobile in the course of garage operations. The BOP did not have a UM endorsement and Nationwide had not offered UM coverage to Chevron under the BOP. Jackson recovered under the UM endorsement to the BAP and filed a declaratory judgment action seeking a judicial determination that UM coverage should be imputed to the BOP under A.R.S. § 20-259.01. Affirming summary judgment for Nationwide, the Court held that the statutory exception for CGL policies and excess policies applied because the BOP was intended to provide primary coverage when a garage employee was driving a customer’s car and was not the primary automobile insurance in this situation.