Florida Lawsuit Challenges Vicarious Liability Precepts

Posted & filed under Florida Car Insurance, Rental Car Insurance.

A report being distributed via the Associated Press, says that the Florida Supreme Court has been urged by an accident victim’s lawyer to rule that rental car companies can be held liable for damages in an accident they did not cause in Florida, despite the existence of a new Federal law intended to shield car rental companies from just such issues.

The legal concept in question, “vicarious liability,” refers to holding non-negligent owners responsible for damages, no matter who was actually driving the vehicle. The 2005 Graves Amendment, a federal law, prohibits such liability, except in states that have insurance or financial responsibility requirements for rental car companies. Representative Samuel Graves (R-MO), the law’s sponsor, believes it will save consumers $100 million a year, nationally.

So what’s the issue in Florida? The Supreme Court is investigating whether or not a Florida “Financial Responsibility” law meets the Federal exception criteria. The existing Florida state law says that if the person who drives or leases a rental vehicle is either uninsured, or has combined insurance limits of less than $500,000, the rental car company, “…shall be liable for up to an additional $500,000 in economic damages.”

Marjorie Gadarian Graham, representing the accident victim, told the court, “It is implicit that there is a requirement to maintain insurance albeit it is not expressly stated.” She also argued that the state legislature intended it to be an insurance requirement and that it’s explicit enough to except Florida from the Graves Amendment.

Enterprise Leasing Company’s attoriney, David C. Boruke, disagreed, and countered by saying, “Nothing is required. It’s an option. It’s an opportunity to make a cost-benefit analysis, but it is not required insurance by any stretch of the imagination.”

A trial judge in Palm Beach County and the 4th District Court of Appeal, in a 6-4 opinion, sided with Enterprise. Accident victim Rafael Vargas’s vicarious liability claim was rejected by both courts. Vargas had been injured when an Enterprise-owned vehicle rear-ended his car in February 2006. Vargas never alleged that the rental car company was at fault or negligent, nor did he allege that the lease was improper.

Despite siding with Enterprise, The 4th District certified the issue to the Supreme Court calling it a “…question of great public importance…” There are severall similar cases on hold pending a ruling, in Flordia, and other states are facing similar issues. One such state is Minnesota, where the state Supreme Court ruled that the Graves Amendment pre-empted a similar state law already on the books there.

Most of the resultant litigation has been at the federal level. The 11th U.S. Circuit Court of Appeals in Atlanta, GA, ruled that Florida’s law was also pre-empted. This means that the Florida court’s decision would apply only to state courts.

Texas Changes Licensing Requirements for Younger Drivers

Posted & filed under Texas Car Insurance.

Today’s post is brief, but important: Texas, which until recently did not require proof of driver education for license applicants over 18 years old, has put into effect a law actually passed by the 2009 legislature.

Effective this month, the Texas Department of Public Safety will now require proof that an approved driver education course has been completed, whenever an applicant between the age of 18 and 24 applies for a drivers license in the Lone Star State. In addition, such applicants must pass a driving skills test.

DPS says the proof must be in the form of a certificate showing successful completion of a driver education course approved by the Texas Education Agency. After providing this proof, applicants will still need to pass the driving skills part of the licensing exam, but the written highway signs and traffic laws test will be waived.

The Texas DPS adds that driver safety courses, defensive driving courses, and drug and alcohol driving awareness programs do not meet the “approved course” criteria.

A list of approved courses can be found here: http://ritter.tea.state.tx.us/drive/activede.html

Auto Insurance RateWatch: Arizona Up 2%

Posted & filed under Rate Watch.

In a trend that appears to be continuing with most auto insurers, Arizona auto insurance has seen a rate hike over the last half a year. Specifically, according to a report in the Insurance Journal, the median six-month rate has increased approximately 2%, to reach $829.00

According to data collected in Arizona, a driver in that state who actually pays that median rate, and earns the state median annual income (about $38,779/year) will be giving up approximately 4.28 percent of their gross annual income in order to maintain their insurance coverage. Using this “affordability factor,” Arizona comes in as the ninth most expensive state in which to insure a car or truck. As of this month, Massachusetts is the most affordable, despite their reputation for high auto insurance rates, probably because the medium income is higher. Louisiana, with a factor of 7.28 percent, is the most expensive state for car insurance under this system of measure.

Other facts pertaining to Arizona auto insurance are:

* Arizona men pay a median insurance rate that is more than 5 percent higher than what women pay.
* Young Arizona drivers – those under 19 years old – pay a median insurance rate that is more than 100% higher than the rate paid by drivers between the ages of 50 and 59.

This is just one example of rate hikes around the country.

Progressive’s “Corn for Kids” Program Returns for a Second Year

Posted & filed under Car Insurance.

Progressive, the United States’ number one motorcycle insurer is bringing their “Corn for Kids” program back for a second round.

The program, which debuted last year, allows bikers across the country to help their communities by eating free corn. The insurer is giving away hot roasted corn at motorcycle rallies across America, while also encouraging people to make small donations to their local food banks.

Specifically, “Corn for Kids” benefits Feeding America food banks across the nation, helping them feed children in need, as well as their families and other related charities. In its inaugural year, participating bikers ate 46,000 ears of corn and fed almost 170,000 families via their food bank donations.

Marcy Gray, a motorcycle product manager at Progressive, as well as a long-time rider herself, said in a press release, “Hot, sweet roasted corn is the perfect treat to attract bikers; we are thrilled to see so many partake in the program and hope to increase participation this year.”

Progressive’s “Corn for Kids” program will be offered at fifteen different motorcycle rallies, all of which are listed on Progressive’s website and their motorcycle Facebook page. Beginning April 15th, the general public (even non-bikers) will be able to participate by clicking a button on Progressive’s website to show their support. Each click will result in a meal being donated to a local Feeding America food bank.

Progressive’s goal for this year is to provide half a million meals to needy children and their families.

Driving Without Reading Leads to Common Problems

Posted & filed under Auto Safety.

A survey conducted in England by a British auto insurer reveals some interesting behavior about new car drivers. Most don’t have a clue about how their new cars work; they just get in and drive off.

The piece was eye-catching for me as I flashed back to a frantic call to my dealership several years ago as I was standing outside my car with the alarm shrieking and no idea how to stop it. I, like 35% of drivers (or at least those in England) hadn’t even glanced at the manual or I might have known to close the door, insert, and turn the key to disengage the alarm. (Notice it just took one ear-splitting incident for me to commit that procedure to memory.)

According to the study, 51% of drivers flick through the manual. Forty percent of women are more likely to drive without reading the manual as compared to 30% of men. The top five problems resulting from this self-imposed ignorance are:

  • No idea how to open the hood.
  • Clueless on the sound system.
  • Stumped by seat position.
  • Groping to turn on the headlights.
  • Ditto for the wipers.

Thankfully, I was saved most of that by a salesman who wouldn’t let me have the keys until I knew how to do each one of those things. Coincidentally, that’s exactly what the study recommended — dealers and garages walking new car owners through the basics before letting them tool off in their new cars.

Seriously, in the event of an accident caused by your fumbling to find the light switch, neither the police officer nor your insurance agent is going to be all that thrilled with the news that you didn’t just read the book in the glove compartment. We all know about defensive driving how about some defensive reading?