NAII Requests Texas Supreme Court Halt Expansion of Auto Coverage

January 21, 2003

The National Association of Independent Insurers (NAII) and Association of Fire and Casualty Companies in Texas (AFACT) have filed an amicus brief asking the Texas Supreme Court to review and reverse a 9th Texas Court of Appeal’s opinion that reportedly has the potential to disrupt the auto insurance marketplace by expanding the types of accidents that fall under personal injury protection coverage.

The case, Farm Bureau v. Sturrock, involves an injury that occurred when Jeff Sturrock reportedly tripped while exiting from his automobile. The court of appeals ruled that the incident should be covered as a motor vehicle accident because it arose out of the use of an auto.

“This judicial expansion of automobile insurance coverage undermines the insurance contract and has the potential to greatly expand liability coverage afforded under both personal and business auto policies,” Donald Hanson, southwestern regional manager for NAII, said. “The court’s opinion is contrary to Texas law and the wording of the contract. The types of accidents that would be covered, if the court of appeal’s opinion is allowed to stand, are well beyond the contemplation of risks included in the current rates.

“Just as judicial action affected foundation coverage in the homeowners market, it could have a negative impact on the auto insurance market. We are urging the Texas Supreme Court to review this case and stop the judicial activism of the lower court.”

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