Supreme Court Of Louisiana Concludes Louisiana Public Policy Does Not Require Automobile Insurance Liability Coverage Related To A Driver’s Negligent Operation Of A Non-Owned Vehicle

The Supreme Court of Louisiana held that the public policy of Louisiana does not require an automobile liability policy to afford coverage for a driver’s negligent use of a non-owned auto where such use is not required by exigency, necessity, or safety concerns. Landry v. Progressive Sec. Ins. Co., 2021-00621 (La. 01/28/22); 2022 La. LEXIS 284.

A friend of the insured drove the insured’s car to a repair shop as a favor, during which he was involved in an accident injuring others. They sued the vehicle owner, the friend, and both of their auto insurers. The owner’s insurer paid policy limits to the plaintiffs, but the driver’s insurer moved for summary judgment that coverage was not afforded because the car did not meet the definition of a “covered auto” under its policy. Plaintiffs argued that this position violated Louisiana’s public policy to protect the public from damage caused by motor vehicles. The district court granted the motion. The appellate court reversed and held that “public policy requires coverage for the named insured while operating a non-owned vehicle with permission in the fulfillment of a good deed for a friend.” The insurer appealed.

The Supreme Court of Louisiana held that the public policy of Louisiana does not require an automobile insurance liability policy to cover a driver’s negligent operation of a non-owned vehicle. The Court’s holding was based, in part, on the view that the public policy underlying the Louisiana Motor Vehicle Safety Responsibility Law requires insurance coverage on the vehicle in all instances, but does not require coverage of the named insured in all instances.