Opinion ID: 2586252
Heading Depth: 3
Heading Rank: 1

Heading: The Excluded Driver Exception to Mandatory Auto Insurance Coverage

Text: Alaska law generally requires Alaska drivers to carry automobile insurance. [6] Alaska Statute 28.22.101, a provision of the Alaska Mandatory Automobile Insurance Act (AMAIA), lays out general coverage requirements for motor vehicle insurance in Alaska. It provides that an owner's motor vehicle liability policy must insure the person named against loss from the liability imposed by law for damages that arise from the ownership, maintenance, or use of a designated motor vehicle. Insurers are generally not permitted to issue auto policies containing provisions which reduce the scope of coverage below the statutory minimum. [7] The AMAIA supplements the Motor Vehicle Safety Responsibility Act (MVSRA). [8] The MVSRA requires an uninsured driver who has been involved in an accident to prove financial responsibility for the future by posting a bond or submitting a certificate of insurance. [9] The MVSRA also requires automobile insurance policies to provide minimum coverages for a named insured and other persons using a vehicle with the named insured's permission. [10] All policies issued in the state must meet the content requirements imposed by the MVSRA, regardless of whether the policies were required as proof under the act. The AMAIA and the MVSRA coexist as part of Alaska's Uniform Vehicle Code. [11] They are not, however, coextensive. [12] As noted, the AMAIA supplements, but does not supplant the MVSRA. [13] In 1997 the legislature enacted an exception to these general coverage requirements. [14] Alaska Statute 28.20.440( l ) provides: Notwithstanding any other provisions of law, a person who resides in the same household as the person named as insured or a person who is a relative of the person named as insured shall be excluded from coverage under a motor vehicle liability policy if the person named as insured requests that the person be excluded from coverage. Subsection .440( l ) thus permits named insured policyholders to exclude select individuals from coverage. In this case, the Uliseses endorsed an exclusion that exempted their son Siuleo from coverage under their auto policy. Because Siuleo was excluded under the policy, Progressive refused coverage for Nelson's claim. Nelson raises two arguments in support of her assertion that Progressive should cover her negligent entrustment claim: (1) because negligent entrustment is an independent tort, the claim does not arise from Siuleo's operation of the car; and (2) the named insured exclusion is unenforceable because it is ambiguous and contrary to Alaska law. We consider each in turn.