GEICO Case Shows You Never Know What Insurance Has To Cover

If you have car insurance, as you must have by law in Florida, you probably figure it covers you for the standard losses you’d have in a car accident. Things like property damage, medical expenses, or if you cause injury to someone else, are all things that you would imagine are covered by your car insurance.

But a recent case shows just how far the limits of car insurance can go. It is also a lesson in how important it is to read the language of your policy, as you may often find that things that insurance denies at first, may actually end up being covered losses.

Transmission of Disease in Vehicle

The case arose when a woman contracted a sexually transmitted disease (STD) in the back seat of a vehicle.

Legally, it is possible to sue someone for transmitting an infectious disease to you. But the practical problem is insurance; even if you sue someone, there is no insurance coverage for it, so your chances of actually recovering on any judgment entered against you are often quite slim.

Or is there insurance? Turns out the woman alleged that there was—the car insurance, which was insured by GEICO. At first, this may seem like a silly lawsuit. But under the language of the insurance policy, it actually had some merit.

GEICO Refuses, and Loses

GEICO of course refused to cover the incident, saying that the policy only covered losses arising from the use of the vehicle. The woman who was suing, who contracted the disease, contended that “use” was a broad term, and that the policy was not limited to just activities related to the driving or operation of the vehicle.

The case went to arbitration, and the arbitrator sided for the woman, finding that GEICO was liable to her for damages caused by the transmission of the STD inside of the vehicle.

GEICO Appeals

GEICO then contended that it never actually ever defended the case—it had only said that it wouldn’t insure the loss.

But that argument at first failed as well; the court found that by fighting so much over whether the loss was a covered loss under the policy, GEICO had waived its right to defend the claim—in other words, had GEICO wanted to defend the case on the merits, it should have done so in the first place.

The verdict has recently been sent back to the trial court for further deliberation—that means that GEICO won its final appeal before the Supreme Court, and will get to defend the claim on the merits.

But it is an important lesson that insurance policies can cover more than you think, and that you shouldn’t take an insurance company’s denial at its word, without speaking to an attorney first.

Contact the Miami personal injury attorneys at Velasquez & Associates P.A. for help today if you feel you aren’t being treated fairly by your insurance company.

Sources:

cbsnews.com/news/geico-std-car-5-million-award-vacated-by-judges/

insurancebusinessmag.com/us/news/breaking-news/why-geicos-5-2-million-std-claim-isnt-wrapped-up-yet-413771.aspx