Progressive Select Insurance Company v. McKinley
- Edward Davila
- 5:20-cv-03229
- U.S. District Court · Northern District of California
- 7
In Progressive Select Insurance Company v. McKinley, Judge Davila granted Progressive summary judgment, ruling California law governs the insurance policy.
Progressive Select Insurance Company and Kevin J. McKinley; the ruling applies California law to McKinley’s coverage dispute and, as described in the opinion, limits his recovery to a maximum of $75,000.
What happened
Progressive Select Insurance Company v. McKinley concerned which state’s law governed an automobile insurance policy after McKinley moved from California to South Carolina and was injured in an accident there. The policy covered four automobiles that were insured and kept in California when the policy was issued. The parties agreed the policy covered the accident but disputed whether McKinley could combine coverage for the four automobiles under South Carolina law.
Progressive argued that the policy required California law because McKinley listed California as his residence on his application. McKinley argued that South Carolina law should apply because he lived there when the accident occurred and South Carolina permits this type of combined coverage. The court held that the policy’s language clearly selected the law of the state listed as the insured’s residence—California. It also concluded that California had the stronger connection to the policy because it was issued there, McKinley listed California as his residence, and the automobiles were kept there when the policy was issued.
Judge Edward J. Davila granted Progressive’s motion for summary judgment and denied McKinley’s motion for summary judgment. The ruling means California law governs the policy’s coverage dispute; the opinion states that this limits McKinley’s recovery for his injuries to a maximum of $75,000.
The detailed version
- Progressive Select Insurance Company v. McKinley · No. 5:20-cv-03229
- Edward Davila
- May 24, 2021
Background
Progressive brought a declaratory-relief action asking the court to decide whether California or South Carolina law governed the terms of an automobile insurance policy issued to Kevin J. McKinley. The applicable law determined the amount of insurance benefits McKinley could recover for injuries from an automobile accident.
Progressive issued McKinley a California Auto Policy for the period from September 30, 2019, through March 30, 2020. McKinley listed California as his residence on the application, and the policy insured four automobiles that were garaged in California. After Progressive issued the policy, McKinley moved to South Carolina and established his residence there. He did not notify Progressive of the move, and Progressive did not learn of it until McKinley filed the claim involved in the case.
On November 8, 2019, McKinley was injured in South Carolina when his Mercedes-Benz was struck by a drunk driver. McKinley was not at fault. Progressive did not dispute that the policy covered the accident. The dispute concerned the amount of available coverage. The parties agreed that California law would limit McKinley’s recovery to a maximum of $75,000, while South Carolina law could permit recovery well above $75,000 through “stacking”—using coverage for more than one insured vehicle in succession until damages are satisfied or policy limits are exhausted.
Parties’ positions
Progressive relied on the policy provision stating that disputes about coverage or policy provisions would be governed by the law of the state listed on the application as the insured’s residence. Because McKinley listed California, Progressive argued that California law applied.
McKinley asked the court to conduct a choice-of-law analysis, arguing that California and South Carolina law conflicted because South Carolina permits stacking and California does not. He contended that California’s governmental-interest analysis supported applying South Carolina law.
Court’s analysis
The court granted Progressive’s motion for summary judgment and denied McKinley’s motion. Summary judgment is a decision entered when there is no genuine dispute about a fact that could affect the outcome and the moving party is entitled to judgment under the law.
The court held that the policy’s language was clear and required applying the law of the residence state listed on McKinley’s application. McKinley listed California, and the court concluded that the stacking question was a dispute about coverage provided under the policy. Therefore, under the policy’s plain language, California law governed.
The court also stated that California law would apply even if a governmental-interest choice-of-law analysis were required. It found that California and South Carolina laws would produce different available coverage. California had interests because McKinley applied for the policy there, identified California as his residence, and kept all four insured automobiles there when the policy was issued. The court also noted that Progressive had not been notified of the changes in McKinley’s residence or the automobiles’ garaging locations before the accident. South Carolina had an interest in protecting McKinley as a South Carolina resident at the time of the accident, but the court found that the other factors—especially the place of the contract and the principal location of the insured risk—supported California law.
The court further concluded that equitable considerations favored Progressive because it issued and priced a six-month California policy to a California resident for automobiles garaged in California, and the policy required California law and required the insured to report changes in residence and garaging addresses.
Disposition
Judge Edward J. Davila granted Progressive’s motion for summary judgment and denied McKinley’s motion for summary judgment. The court concluded that California law governed the policy and the dispute over stacking coverage.
Read the full 7-page opinion on CourtListener, the free public archive maintained by the Free Law Project.