The West Virginia Supreme Court issues a series of judgments – some for, some against insurers

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The West Virginia Supreme Court has made four decisions that could affect insurers’ payouts in auto, homeowner and work-related injuries.

Non-employees covered

In Ball v. United Financial Casualty Co., the court found that the insurer must provide coverage for a non-employee licensed to drive a vehicle who caused an accident in which an insured’s employee was injured.

The state Supreme Court of Appeals answered a certified question from US 4th Circuit Court of Appeals. The state court essentially agreed with the federal appellate judges, citing a 1987 court ruling noting that West Virginia law specifically states “that the legislature has shown a clear intention to protect anyone who owns a vehicle with the Owner’s permission used as a gift-giving means of giving insurance coverage more protection to people involved in auto accidents. The law should be interpreted broadly to provide coverage.”

The incident happened in 2016. Workers at a hardware store in Milton were carrying out construction work on a man’s home. The hardware company owner authorized the homeowner to move one of the company trucks that was blocking the driveway. However, as he backed up, the man pushed a worker into another truck, resulting in serious injuries and a hospitalization.

Greg Ball, the injured worker, sought compensation from United Financial, Milton Hardware’s liability insurer. The auto insurance company provided up to $1 million in liability coverage, with approval, for “any person who uses Milton Hardware’s vehicles,” Ball’s attorneys argued.

United Financial, a progressive insurance company, asked a federal district court to declare that it had no obligation. The policy contained an exclusion of workers’ compensation and an exclusion of workers’ compensation in such circumstances. The federal court agreed with the insurance company.

In the appeal process, however, the 4thth The Circuit Court of Appeals dismissed the case, finding that the exclusion of workers’ compensation did not apply because the claim was against a third party – the homeowner – and not the employer. The appellate judges also said that the employee compensation exclusion was not applicable because it violated state law.

While in custody, the parties couldn’t agree on the amount of coverage United Financial Ball owed under West Virginia’s auto insurance laws: Does the exclusion still apply above the $25,000 coverage limits? This led to another round of appeals. Since the court decision in West Virginia has no precedent, the 4th Circuit asked the state Supreme Court for a ruling.

The judges firmly sided with the injured worker.


“We are now of the opinion that if an exclusion in a motor liability insurance policy violates Section 33-6-31(a) of the West Virginia Code because it would deny coverage to an authorized user of an insured vehicle, the exclusion and the insurance are invalid. The policy must cover the permissive user up to the full liability limits of the policy,” John Hutchinson, chief justice of the Supreme Court, wrote in the Nov. 17 majority opinion. Judge Tim Armstead disagreed.

The case now goes back to April 4th Circuit for further procedure.

liability in the event of an aircraft accident

In another worker’s compensation case, the state Supreme Court granted relief to air transport insurer Praetorian Insurance Co. on some grounds but not on others. The case was deemed of utmost importance to the insurance industry and amicus briefs were filed by the West Virginia Insurance Federation and the state Chamber of Commerce.

The case also involved West Virginia lawyers applying Wisconsin law to a fatal flight that originated in Kentucky, ended in West Virginia and was insured by a Wisconsin airline owned by an Australian investment company.

The estate of Air Cargo Carriers first officer Anh Ho had sued the air carrier, arguing that it was responsible for the 2017 Charleston plane crash that killed two pilots, had no immune immunity from tort and was not entitled to the exclusive Bound to appeal is Arbeiterkomp. The reason, according to the plaintiffs, is that the airline acted negligently and intentionally disregarded prescribed security measures.

The National Transportation Safety Board determined that the crash was the result of pilot error and a descent that was too steep, according to news reports.

Praetorian, owned by QBE Investments, insures homeowners as well as aircraft companies and other businesses. His lawyers argued that he should be allowed to intervene in the case because he had a vested interest in keeping the case in the arena of the less expensive labor companies.

The West Virginia Supreme Court ruled that Praetorian had no standing. Although the federal code of civil procedure allows insurers to intervene in lawsuits against the insured, in this case the insurance company wanted to intervene only to determine if it had a duty of defense.

“Praetorian is attempting to intervene to assert compensation immunity for Air Cargo workers. None of the cases cited by Praetorian allowed an insurer to step in to enforce a right of its insured,” Judge Haley Bunn wrote in the Nov. 17 opinion.

But on another issue, the court sided with the insurer, finding that the insurance policy excluded coverage for intentional acts by the insured airline. The trial court erred in finding that West Virginia’s disqualification law had limited scope, the judges said.

And like the United Financial Casualty Co. case above, questions have been raised about whether the exclusion violates state law.

In this case, Wisconsin law applies, the Supreme Court justices said, and the parties agreed because case law has long determined that the law of the state in which the insurance policy was purchased governs. The trial court in Kanawha County, West Virginia, found that Wisconsin law prohibits denial of coverage for flight operations that violate air traffic regulations.

But the Supreme Court reversed that, noting that the Wisconsin statute applied only to aircraft insurance policies, not to workers’ compensation and liability policies. The first-instance judgment was partially set aside, partially confirmed and referred back.

More conscious intent

In another case involving workers’ compensation and exceptions to their immunity, the court overturned a trial court order from 2021 in a tragedy involving a city worker who was killed while digging a drainage ditch.

The widow in Edwards v. Star sued her husband’s superiors, claiming they were responsible for his death due to willful intent and reckless conduct. However, the Supreme Court found that she proved no intent and that the defendants were barred from civil actions by virtue of workers’ compensation immunity.

The HO policy can be revoked

In a fourth case, the court ruled, at least provisionally, against Allstate Vehicle and Property Insurance Co., which had issued a policy for a dilapidated home that the homeowner was remodeling.

After a fire damaged the home and its contents, Allstate canceled the policy, claiming the homeowner misrepresented that he intended to live in the home within 30 days. The homeowner sued for breach of contract. The trial court granted Allstate’s motion to void the policy, saying there were no questions of fact in the homeowner’s motion statements.

The Supreme Court said there were indeed questions and remanded the case for further deliberation.

Photo above: An Air Cargo Carriers plane in 2022. (Larry MacDougal via AP)

Porter Virginia