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Insurer Liable for Ambiguously Worded Golf Cart Exclusion

Not all motor vehicle accidents involve cars or trucks. Even the misuse of something like a golf cart may give rise to a personal injury lawsuit. And as with any accident litigation, the roles and responsibilities of the insurance companies may prove critical.

Golf Cart Accident

For example, the Georgia Court of Appeals recently weighed in on a personal injury lawsuit arising from a golf cart accident. The incident occurred in a planned community in Fayette County. A man was driving his motorized golf cart on one of the community’s paths when he struck and injured a woman. She sued for negligence.

The driver had a homeowner’s insurance policy. The insurance company asked a Georgia court for a declaration that it was not liable for any damages arising from the golf cart accident. The original policy excluded coverage for all motor vehicles except for golf carts “designed to carry up to 4 persons.” A later amendment to the policy specified a golf cart was covered if it was “[d]esigned to carry up to 2 persons” and two golf club bags.

The golf cart in this case was designed with four seats. The insurance company argued the amended policy only covered two-seat golf carts. The driver replied that the language simply meant the golf cart had to seat at least two people in order to receive coverage.

Both the trial court and the Court of Appeals agreed with the driver. Judge Carla Wong McMillan, writing for the Court of Appeals, said that while both parties offered a reasonable interpretation of the insurance policy, the language was ultimately ambiguous, and Georgia law resolved any such ambiguity in favor of the policyholder, not the insurance company. “By its express terms,” Judge McMillan said, “the Policy appears to exclude coverage for any golf carts that are designed to seat only one to three persons.” However, the amended policy created an ambiguity, as it may mean a golf court is excluded unless it seats “up to” two persons (a maximum) or it simply adds two- and three-seat golf carts to the original policy’s coverage of four-seaters (a minimum).

Ultimately, the insurance company, not the policyholder, is responsible for drafting the language of the policy in clear, unambiguous terms. As Judge Wong pointed out, even the insurance company’s own underwriting director acknowledged in a deposition that the policyholder’s interpretation of the policy was plausible. That does not mean the insurance company’s position was unreasonable, but again, in Georgia, the burden is on the insurer to prove its policy does not apply. And if the insurance adjuster thought the policyholder’s interpretation was reasonable, that suggests an ambiguity that must be resolved in his favor.

Accordingly, the Court of Appeals agreed with the trial court’s decision to grant summary judgment to the driver. This means the insurance company will be liable for any personal injury award arising from the accident victim’s lawsuit against the driver.