Ohio Supreme Court Applies Contract Language to Determine if Permissive User Qualifies as an Insured Under a Personal Auto Policy.

This lawsuit involved a dispute as to which insurance policy should provide liability coverage for an auto accident. The driver, Ashton Smith, was insured by Acuity. He was driving a car insured by Progressive. It was undisputed that Smith was a permissive user of the vehicle. The Progressive policy defined an insured person as: 

“Insured Person” means: 
***
 b. any person who is not insured for liability coverage by any other insurance policy *** with respect to an accident arising out of that person’s use of a covered auto with the permission of you, a relative, or a rated resident.” 

Progressive argued that since Smith was insured by Acuity, he was not an insured person under the Progressive policy’s permissive user coverage. The trial court held in favor of Progressive. Acuity appealed, and the Eleventh District Court of Appeals held in favor of Acuity. Progressive then appealed to the Ohio Supreme Court. 

The Ohio Supreme Court applied the plain language of the policy and found that since Smith was insured by Acuity, he did not fit the definition of an insured under the Progressive policy. The court limited its prior holding in State Farm Mut. Auto. Ins. Co. v. Home Indemn. Ins. Co., 23 Ohio St.2d 45, 261 N.E.2d 128 (1970) (the case relied on by Acuity) wherein the court had previously held that the driver’s insurance and the owner’s insurance were pro rata. 

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