INSURANCE-RELATED COURT CASES
Digested from case reports published online
COURT DECISIONS
Hey insurers, just share
A driver of an SUV met tragedy in a collision with a tractor-trailer. The driver of the tractor-trailer was, at the time of the loss, working on behalf of Deerpass Farms Trucking, LLC-II (Deerpass). The accident resulted in the SUV driver’s death, and his estate sued for wrongful death.
Deerpass, though initially named in the lawsuit filed by the deceased driver’s estate, was not the owner of either the truck or the trailer. Both were leased from other businesses. However, Deerpass arranged separate liability protection for both.
The tractor was leased from Deerpass Farms Services, LLC (Deerpass Farms). It was insured under a liability policy ($1 million limits) from Great West Casualty Company (Great West). Deerpass was the policyholder. The trailer was secured from Conserv FS, Inc., (Conserv) under a Trailer Interchange Equipment Use Agreement. The trailer was covered by a $2 million liability policy from Nationwide Agribusiness Insurance Company (Nationwide) with Conserv as the policyholder.
There was no dispute regarding the eligibility of the fatal collision for coverage, as both the Great West and Nationwide policies’ wording and definitions provided protection for the three parties eventually named under the underlying complaint (Deerpass Trucking, Deerpass Services and Conserv.)
However, a problem arose between the two insurers on the matter of contributing to any loss payment. Great West argued that it did not bear responsibility to respond to the accident on a primary basis. Specifically, it stated that, after applying the other insurance provisions of both policies, along with the various contractual arrangements, its policy should be treated as an excess source over any other source, particularly Nationwide. It filed a separate lawsuit to clarify the matter. When a lower court ruled that the insurers should share payment in proportion to their respective policy limits, Great West appealed.
On appeal, their argument was revisited. The court began its efforts by examining the two policies involved with the underlying collision. The most relevant issue was the language used regarding the response to losses when more than one financial responder exists. This is commonly known as an Other Insurance (or other source of recovery) provision.
The court found in Nationwide’s policy that its protection was primary for covered autos that an insured owns. It was also primary for trailers that are connected to an insured’s owned auto. The policy’s coverage was excess for covered autos that are not owned by an insured. It was also excess for trailers owned by an insured when connected to an auto that an insured does not own.
Under Great West, the court found that, per its policy wording, its obligation to respond largely depends upon whether the covered autos (not including trailers) are hired or borrowed or are covered trailers.
With hired/borrowed autos, the obligation was to provide Primary Coverage when:
The insured is the lessor/lender, the lessee/borrower is another motor carrier and a written agreement requires the lessor to hold the lessee/borrower harmless.
The insured is the lessee/borrower, the lessor/lender is another motor carrier and a written agreement does not require the lessor to hold the lessee/borrower harmless. This applies only when the lessee/borrower uses the covered auto in its business as a hired motor carrier.
With hired/borrowed autos, the obligation was to provide Excess Coverage when:
The insured is the lessor/lender, the lessee/borrower is another motor carrier and a written agreement does not require the lessor to hold the lessee/borrower harmless.
The insured is the lessee/borrower, the lessor/lender is another motor carrier and a written agreement requires the lessor to hold the lessee/borrower harmless.
With covered trailers that are connected to a power unit (tractor or truck), the obligation is following:
Provide coverage on the same basis (either primary or excess) that applies to the applicable power unit that is also a covered auto.
Provide coverage on an excess basis when the applicable power unit is not a covered auto.
Other than what was just stipulated, any other instance of an owned covered auto is protected on a primary basis; any non-owned covered auto is protected on an excess basis. Finally, primary coverage applies to all situations where the insured assumes liability under what qualifies as an insured contract.
Besides the two insurers’ other insurance provisions, the court also considered the litigants’ opposing interpretations of the same sections, cases presented as relevant, the insured statuses under both policies and the Trailer Interchange Equipment Use Agreement that applied to the truck trailer.
The court was not persuaded by arguments from both insurers that one was excess to the other, or that the Trailer Interchange Equipment Use Agreement qualified as an insured contract. The court also determined that no case history could be found that was applicable to their dispute.
The result was the higher court finding that, under the circumstances, both policies were obligated to respond on an excess basis to the accident. Therefore, that court affirmed the lower court order that the insurers respond to the loss on a pro rata basis, according to their respective policy limits and that defense and court costs were to be evenly split.
Great West Casualty Co. v. Nationwide Agribusiness Insurance Co., and Conserv FS, Inc. and Timothy A. Brennan, as Administrator of the Estate of Patrick J. Brennan, deceased—U.S. Court of Appeals for the Seventh Circuit—Nos. 24-1258 and 24-1259—February 11, 2026.
