Insurance Law

Coverage for Residents Who Don't Primarily Reside in a Household

, The Legal Intelligencer



On May 1, 1984, 15-year-old Lynda Sue Frazier was killed in a high-speed chase with police while riding with friend and classmate Herbert J. Houston in a vehicle that, unbeknownst to her or her mother, was stolen. The vehicle had no insurance coverage, and her mother's policy excluded coverage for vehicles used without the owner's permission. However, because of a well-settled principle of law observed by many states around the country, her parents were able to recover under her father's uninsured motorist policy.

Perhaps in response to this well-settled principle, insurance carriers have developed new policy language that has yet to be litigated in Pennsylvania courts. However, if the growing litigation around the country is any indication, when this new language inevitably hits the Pennsylvania courts, recovery in cases like this will no longer be available.

'Resident of the Household'

At the time of her death, Frazier's parents were divorced. She lived with her mother most of the time but spent some nights at her father's house, kept some possessions there and was claimed by her father on his taxes. As it turned out, her father's uninsured motorist coverage contained typical language defining the word "insured" to include himself, plus any "family member." The policy further defined "family member" as "a person related to you by blood, marriage or adoption who is a resident of your household, including a ward or foster child."

Thus, in Nationwide Insurance v. Frazier, 39 Pa. D. & C.3d 254 (1986), the Mercer County Court of Common Pleas held that even though Frazier's mother had custody of her and Frazier lived with her mother for most of the year, she had sufficient enough connections to her father's household to also be considered a resident of his household, and therefore an insured, under his policy.

In the years since Frazier, the Pennsylvania Superior Court in Erie Insurance Exchange v. Weryha, 2007 Pa. Super. 247, 931 A.2d 739, 742 (2007), and Amica Mutual Insurance v. Donegal Mutual Insurance, 376 Pa. Super. 109, 545 A.2d 343 (1988), has confirmed the relatively straightforward and well-accepted principle that "a child of separated or divorced parents may be regarded as a resident of the household of both parents."

'Resides Primarily' in the Household

Undoubtedly in response to this principle, some carriers have eschewed the language found in Frazier, at least in the context of uninsured and underinsured motorist coverage. In its place, these carriers have adopted language providing coverage for a relative who "resides primarily" with the named insured on an insurance policy. This language first defines an "insured" as "(1) the first person named in the declarations; (2) his or her spouse, and (3) their relatives." Then, it defines a "relative" as "a person related to you or your spouse by blood, marriage or adoption who resides primarily with you."

The result, in the states that have considered this language, has been the end of the practice of allowing people, such as children of divorced parents, to be covered under more than one such policy.

Mounting Litigation

In one of the earliest published opinions involving the "resides primarily" language, the Court of Civil Appeals of Alabama in B.D.B. v. State Farm Mutual Automobile Insurance, 814 So. 2d 877, 881 (Ala. Civ. App. 2001), considered the language and had no problem distinguishing it from the "resident relative" language, opining that, "We do not disagree with the proposition that a child of separated or divorced parents may be regarded as a resident of the household of both parents, and, if this policy had different language, then we might reach a very different result here. The language in this policy, however, is clear and unambiguous. ... The fact that B.D.B. kept personal items at her father's house and spent two Saturdays a month with him does not compel the conclusion that she lived primarily with him."

Two years later, in State Farm Mutual Automobile Insurance v. Harris, 882 So. 2d 849, 854 (Ala. 2003), in consideration of the same language, the Alabama Supreme Court acknowledged that while a person may have more than one household, "we fail to see how a person may 'primarily' or 'for the most part' live in more than one place at one time."

This litigation subsequently began to appear in other states, but with the same result. In State Farm Mutual Automobile Insurance v. Colon, 880 So. 2d 782, 783 (Fla. Dist. Ct. App. 2004), a claimant was in an automobile accident while temporarily living with her grandfather while she waited for her own water-damaged house to be repaired. While there, she continued to maintain the mortgage, utilities, phone and mail service at her own house. She also had a clear intent to move back to her house when the repairs were complete. The court found that although the claimant was not living in her home at the time of her car accident, she never abandoned the home as her primary residence, and she could not claim to have a second primary residence under the grandfather's policy.

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