Old Republic Relies Upon Escape Clause To Partially Avoid Primary Coverage In Auto-Tractor-Trailer Accident

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Amerisure Ins. Co. v. Old Republic Ins. Co.,
M.D. Fla. Sept. 27, 2013 (2013 U.S. Dist. LEXIS 139251)

This declaratory judgment action arises from an underlying auto and tractor-trailer accident. At the time of the accident, the tractor was owned by Ryder Truck Rental, and the trailer was owned by an affiliate of Star Transportation Company and Star Distribution Systems, Inc. (collectively Star). The tractor was leased to Star pursuant to a Truck Lease and Service Agreement (TLSA). Ryder was insured under a business auto insurance policy issued by Defendant Old Republic Insurance Company, and Star was insured under a business auto insurance policy issued by the plaintiff Amerisure.

Amerisure sought a declaration that: (a) Old Republic owed primary coverage for damage to both the tractor and the trailer; (b) Amerisure owed excess coverage for damage to the trailer; and (c) Old Republic has a duty to defend the underlying action.

The court noted that Old Republic’s policy contained an “escape clause” which stated that coverage was “excess over any other valid and collectible insurance the lessee/renter may have whether such coverage is on a primary, excess or contingent basis.” Amerisure’s policy contained an “excess clause” which provided that coverage for the trailer was considered excess because the trailer was connected to a vehicle [the tractor] that the insured did not own. However, the court found that under Florida law, escape clauses defeat mere excess clauses, and held that Old Republic had primary coverage on the tractor while Amerisure has primary coverage on the trailer. Accordingly, both carriers had a duty to defend in the underlying action.