Child considered resident relative of noncustodial parent for purposes of auto insurance coverage

Law Reporter, Apr 2000

Ohio Cas. Ins. Co. v. Estate of Wittkopp, 741 A.2d 619 (N.J. Super. Ct. App. Div. 1999).

A New Jersey appellate court held that a child is covered as a resident relative under a noncustodial parent's auto insurance policy.

Here, a child was struck and killed by a car. The driver's liability insurance covered $100,000 of the claims on behalf of the child and her estate. A dispute then arose between the parents' insurance companies over the remaining amount. The father's insurance company denied responsibility for coverage, arguing that it only covered residents of the father's household. Because the child had lived with her mother and visited her father on weekends and holidays, the company asserted that the child was a resident of her mother's household and, therefore, not insured under its policy. It instituted a declaratory judgment action, which the judge granted in its favor.

Reversing, the appellate court noted that children of divorce are commonly recognized as maintaining more than one residence. Even if the child is absent from a parent's home for several months, this does not terminate the child's residency without additional factors. To determine whether a child is a resident relative of a noncustodial parent, the court used the test set out in Garrison v. Travelers Ins. Co., 618 A.2d 387 (N.J. Super. Ct. Law Div. 1992), which considered the following factors: (1) the age of the child-noting that the younger the child the greater the chances she was a resident of both households-and whether the noncustodial parent (2) had reasonable visitation rights, (3) was current with child support, (4) had a good relationship with the child, and (5) provided the child with a bedroom or separate wardrobe at the noncustodial parent's house. The court found that the relationship between the decedent and her father satisfied all the Garrison elements. Therefore, the decedent was a resident relative of her father and covered under his insurance policy.

Moreover, the court noted that the reasonable expectations of an insured may usurp a policy's language. The father purchased a policy that, on its face, covered family members. The policy did not mention any residency requirements or make provisions for noncustodial parents. The court explained that ambiguities in insurance policies should be decided in favor of the insured. In this case, denying coverage of the decedent would fall short of the father's reasonable expectations. Thus, the court concluded, the decedent was insured under her father's policy.

Parents' Counsel

Mark S. Hochman, Wall Township, N.J. Stephen E. Gertler, Wall Township, N.J.

Comment: For a case holding that an auto insurance policy covered a vehicle even after the insured conveyed it to his daughter, see Country Mut. Ins. Co. v. Matney, S.W3d _, No. WD 56694,1999 WL 1071459 (Mo. Ct. App. Nov. 30, 1999). There, a Missouri appellate court found that the risk insured against was based not on the ownership of the vehicle but rather on the loss and injury caused by its use. Thus, where a policy provides liability coverage for a specific vehicle and does not precondition coverage on ownership, transfer of ownership will not vitiate the policy. David T. Butsch of St. Louis, Mo., represented respondent in this case.