Imagine the following scenario: you are involved in a fender-bender in the parking lot of the grocery store. Your car is taken to the body shop for repairs. Since you need transportation to get to work and other places in the mean time, you rent a car from the local agency. When picking up the car, you’ll no doubt be offered liability insurance through the agency–at an additional cost, of course. There may also be coverage available through the credit card you use to pay for the rental. And then there is the policy you maintain on your regular car. Does it extend coverage to the rental?
Louisiana law recognizes a “temporary substitute vehicle,” which is commonly defined by insurance companies as a short-term substitute for a car that is out of service due to breakdown, repair, servicing, theft, or destruction. State statute requires automobile insurance companies to “extend to temporary substitute motor vehicles … any and all such insurance coverage in effect in the original policy.” La. R.S. 22:681. In other words, the auto insurer must provide the same coverage to the rental car as was already in place on the regular vehicle.
The recent case of Smith v. Louisiana Farm Bureau Casualty Insurance Company, No. 45,013, Ct. of App. of La., 2d Cir. (2010), explored the definition of “temporary substitute vehicle” in detail. On the morning of May 28, 2005, Brian Smith was driving a 2003 Nissan Altima on U.S. Highway 425 in Morehouse Parish. At the same time, Joshua Pruett was driving a 1998 Dodge Ram pickup truck on the highway in the opposite direction. Pruett’s truck was pulling a utility trailer containing crawfish and ice that had been loaded in Crowley. The ball on the truck’s trailer hitch was too small for the trailer and Pruett did not use any safety chains to ensure that the trailer remained attached to the truck. The trailer eventually disconnected from the truck, at which point it crossed the highway’s center line and collided with Smith’s Altima. Smith died at the scene from the severe trauma he sustained in the accident.
Ordinarily, Pruett hauled crawfish for his employer, Broubar, Inc., in a larger Dodge pickup truck that is equipped with a refrigeration cooler biult into its bed. However, on the day of the accident, the larger truck was being repaired, so Pruett’s employer substituted the smaller truck. The smaller truck could not hold a cooler for the crawfish in its bed, and so the utility trailer was used instead.
One of the issues before the court on appeal was whether Pruett’s truck and trailer, together, would be considered a “temporary substitute vehicle” for purposes of insurance coverage. The insurance carrier who issued the policy for Pruett’s usual truck argued that the trial court erroneously treated the truck and trailer as a single unit. However, the Court of Appeals noted that
in order for the [smaller] Dodge to function as a temporary substitute vehicle for the [larger] Dodge, it needed to pull a trailer that could hold a cooler to keep the crawfish refrigerated… Accordingly, we find no error in the trial court’s conclusion that the [smaller] Dodge truck and the trailer together constituted a temporary substitute vehicle operating as a single unit.
The Smith case demonstrates the willingness of Louisiana courts to interpret the “temporary substitute vehicle” concept broadly in a way that can significantly benefit plaintiffs. If insurance coverage is not extended to temporary substitute vehicles, a motorist who is injured by a driver operating a substitute vehicle could seek damages only from the vehicle’s owner. Even in a situation like the Smith case, where a corporation owned the vehicle, the owner may not have sufficient assets to fully compensate the victim. By extending insurance coverage whenever possible, the courts make it more likely that an accident victim can be made whole.
If you have been injured in a car accident, call the Berniard Law Firm toll-free at 504-521-6000 to speak with an attorney who can help.