Can an Automobile Exclusion Have Multiple Meanings?

Insurance companies don’t have your best interests as their top priority: they want to make money. Even when they know they should pay a meritorious claim, they can frequently try to find a way to avoid paying an accident victim. Many insurance adjusters are fine people who want to do the right thing, but their insurance companies require them to frequently deny claims if possible because they’re concerned with the bottom-line.

In a recent case, a motorcyclist was fatally injured in an accident when his bike was struck by a car on a state highway. His widow sued the motorist’s insurance carrier, contending that a commercial general liability insurance policy that it issued to the other driver provided coverage for the accident. But the insurer argued that their policy clearly and unambiguously excluded coverage for the accident.


On the evening in June 2017, a motorist who may have been drinking, was driving his pickup truck on a state highway when he tried to make a left turn into the path of a funeral procession. While attempting the turn, he hit a motorcycle driven by the victim, who died as a result of the injuries he sustained. Following the accident, the victim’s widow, individually and as executrix of her husband’s estate, brought a personal injury and wrongful death action against the motorist.

After a trial, the jury awarded a $1.6 million damages verdict to the widow. Based on a limited liability release agreement, the judgment entered on the verdict specified that it was “only enforceable against any remaining liability insurance and/or underinsured motorist insurance coverage which provide[d] coverage for the claims contained within [the] case.”

At the time of the accident, the motorist had an automobile insurance policy with State Farm plus a commercial general liability insurance policy with Nationwide (the “CGL Policy”). The accident victim had insurance policies with Liberty Mutual and Progressive that provided uninsured motorist (“UM”) coverage. The widow got the insurance proceeds from his two UM carriers and from the motorist’s automobile insurance carrier (State Farm). However, Nationwide disputed whether there was coverage for the accident under the motorist’s CGL Policy and declined to pay.

The motorist assigned any rights he might have under his CGL Policy to the widow. Based on that assignment, she sued Nationwide, seeking a declaratory judgment that the CGL Policy covered the accident and that no policy exclusions applied. She also sought to recover damages from Nationwide for the remaining unpaid amount of the judgment entered against the motorist in the wrongful death suit.

Nationwide moved for judgment on the pleadings, contending that the CGL Policy excluded coverage for any bodily injury that arose out of use of the insured’s (i.e., the motorist’s) automobile, such that all of the widow’s claims failed as a matter of law. In response, the widow argued that the automobile exclusion reasonably could be construed more narrowly as only applying when the insured’s automobile was used by or entrusted to a third party, and that any ambiguity in the contractual language should be construed in her favor. The trial court rejected her argument, holding that the CGL Policy unambiguously excluded coverage under the facts as alleged in this case. As a result, the trial court granted Nationwide’s motion for judgment on the pleadings. The widow appealed, arguing that the court misconstrued the automobile exclusion.

What Does the Insurance Policy Mean?

Presiding Judge Anne Elizabeth Barnes of the Georgia Court of Appeals wrote that under state law, insurance companies are generally free to set the terms of their policies as they see fit so long as they do not violate the law or judicially cognizable public policy,” and “a carrier may agree to insure against certain risks while declining to insure against others.” Quoting a 2021 decision, the judge noted that it’s well-established that

insurance is a matter of contract, and the parties to an insurance policy are bound by its plain and unambiguous terms. Thus, when faced with a conflict over coverage, a trial court must first determine, as a matter of law, whether the relevant policy language is ambiguous. As this Court has explained, an ambiguity is duplicity, indistinctness, or an uncertainty of meaning or expression, and a word or phrase is ambiguous when it is of uncertain meaning and may be fairly understood in more ways than one. Where a term of a policy of insurance is susceptible to two or more reasonable constructions, and the resulting ambiguity cannot be resolved, the term will be strictly construed against the insurer as the drafter and in favor of the insured. If a policy exclusion is unambiguous, however, it must be given effect even if beneficial to the insurer and detrimental to the insured. We will not strain to extend coverage where none was contracted or intended. Whether ambiguity exists in a contract is a question of law for a trial court.

The CGL Policy identified the named insured as the motorist “dba Mike the Glass Guy,” listed his business as “custom glass work,” and provided $1,000,000 in insurance coverage per occurrence. The CGL Policy specified that Nationwide “will pay those sums that the insured becomes legally obligated to pay as damages because of ‘bodily injury’ or ‘property damage’ to which this insurance applies,” but it included an exclusion for “Aircraft, Auto or Watercraft” that provides in part:

This insurance does not apply to: … “Bodily injury” or “property damage” arising out of the ownership, maintenance, use or entrustment to others of any aircraft, “auto” or watercraft owned or operated by or rented or loaned to any insured. Use includes operation[.]

In addition, “auto” was defined in part as “[a] land motor vehicle … designed for travel on public roads.”

The parties’ dispute centers on the circumstances under which use of the insured’s automobile excludes coverage under the CGL Policy. Nationwide argued that the exclusion unambiguously excluded coverage for bodily injury arising out of the use of the insured’s automobile, irrespective of whether the automobile was used by the insured or someone else. In contrast, the widow argued that the exclusion was ambiguous and reasonably could be construed in her favor as excluding coverage only when the insured’s automobile is used by or entrusted to someone other than the insured.

Was the Exclusion Susceptible to Multiple Meanings?

The Court of Appeals concluded that the exclusion was susceptible of only one reasonable construction, and it was the one advanced by Nationwide. By its plain language, the Automobile Exclusion excluded coverage under the CGL Policy for bodily injury “arising out of the … use of any auto owned by any insured.”

Plus, the exclusion didn’t have any language limiting or qualifying who must be using the insured’s automobile when the bodily injury occurs. Because the words in the policy were plain and obvious, they must be given their literal meaning and no new terms could be inserted, Judge Barnes wrote. So, based on the unambiguous language of the Automobile Exclusion, the CGL Policy didn’t provide coverage where the bodily injury arose out of use of the insured’s automobile, regardless of whether the automobile was used by the insured or someone else.

What About A “Serial Comma”?

The widow also asserted that the absence of a serial comma in the series “the ownership, maintenance, use or entrustment to others” created an ambiguity in the exclusion that should be construed in her favor. Specifically, she said that, without a comma between “use” and “or entrustment,” the exclusion lacked clarity, and a reasonable construction was that it excluded coverage only when the insured’s automobile was used by or entrusted to someone else. In other words, she contended that in the absence of a comma between “use” and “or entrustment,” the prepositional phrase “to others” that followed “entrustment” reasonably could be construed as modifying both “use” and “entrustment.” As a result, she claimed that the exclusion reasonably could be interpreted as not applying where the insured’s automobile was used by the insured.

But Judge Barnes and the Court of Appeals found this argument unpersuasive. The absence of a serial comma in a series carried little weight where, as here, the interpretation that was advanced otherwise conflicted with well-recognized rules of grammar and with standard English usage. As the Georgia Supreme Court emphasized, “contractual terms are construed according to their usual and common signification, and in construing contracts, the rules of grammatical construction usually govern.” Under the rule of the last antecedent, “[r]eferential and qualifying words and phrases, where no contrary intention appears, refer solely to the last antecedent,” the judge explained, quoting an earlier case.

In the Automobile Exclusion, the limiting phrase “to others” immediately followed the word “entrustment,” and under the last antecedent rule, the limiting phrase was reasonably understood to refer to that word and no others. The widow’s proposed construction of the exclusion ignored that rule.

The Court of Appeals concluded that because the victim’s bodily injuries arose out of the use of the insured’s (i.e., the motorist’s) automobile, the Automobile Exclusion excluded coverage under the CGL Policy for the automobile accident. Therefore, the widow’s claims failed, and the trial court committed no error in granting Nationwide’s motion for judgment on the pleadings. The judgment was affirmed. Frey v. Nationwide Mut. Ins. Co., 2024 Ga. App. LEXIS 191 (Ga. App. May 15, 2024).

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Your insurance policy contains numerous clauses and definitions that aim to give the insurance company leverage to deny your accident claim. It can be confusing, and you should speak to an Atlanta accident attorney who has worked in this area for years.

If you have questions about insurance policy interpretation and whether an individual may be liable for your accident, contact experienced Atlanta truck accident lawyers at Tobin Injury Law.