Opinion ID: 301239
Heading Depth: 1
Heading Rank: 3

Heading: exclusion three

Text: 35 The final policy provision that Ranger contends suspended Culberson's insurance coverage provides: 36 This policy does not apply . . . to any insured . . . who operates or permits the aircraft to be operated in any manner which requires a special permit or waiver from the Federal Aviation Agency, whether granted or not, unless this Policy is specifically endorsed to include such operation. 37 Ranger argues that Culberson violated a regulation by carrying a passenger [14 C.F.R. Sec. 61.3(a)], that he did not obtain a waiver from the FAA for the act of carrying a passenger [49 U.S.C.A. Sec. 1421], and that Ranger did not endorse the carrying of a passenger. 38 We conclude that Exclusion Three does not apply to suspend coverage in this instance. Even if applicable to Mr. Culberson under McDaniel, the terms of Exclusion Three were met. The policy did not require a waiver by the FAA; it required only an endorsement of such operation by the company. We have already concluded that Ranger is to be charged with knowledge that Culberson, at his application as well as at his death, was a student pilot and no more. We then note that passenger coverage is specifically in-cluded in the policy, the in having been typed into a blank space in the policy, in capital letters, by Ranger. For that in, Culberson paid an additional premium of $175 per year, almost 50% more than the premium without the passenger coverage. Ranger argues that the passenger proviso relates only to the other pilots that are mentioned in the typed portion of the Pilot Clause and not to Culberson himself. We find this quite an improbable construction. There is certainly nothing in the provision itself to indicate that the in-clusion goes to one part of a conjoined sentence and not to the other. Moreover, the fact that Culberson's name is specifically typed into the clause indicates to us that the passenger proviso, which falls on the same page and in close proximity of the Pilot Clause, was fully intended to apply to Culberson. This is another one of those occasions in which a construction seems compelled by the words. If Ranger intended to convey something less by checking this proviso and charging the additional premium, then that should have been clearly stated. By in-cluding the passenger coverage provision, Ranger specifically endorsed his operation of the aircraft with a passenger aboard for the purposes of Exclusion Three. 39 In a sense broader than the three clauses we have discussed above, we feel that Ranger contracted for precisely the matrix of risks that eventually came to fruition. Compare Underwriters at Lloyd's of London v. Cordova, 9 Cir. 1960, 283 F.2d 659. Ranger insured a student pilot and in-cluded passenger coverage, omitting specific exclusions that might have foreclosed the entire issue. 40 The clumps of words in an insurance policy might seem like so much insignificant jabberwocky to those who follow insurance law, perhaps worse to those who only stumble into the field. Jabberwocky it might be. Insignificant it is not. On those clumps of words rests the intent of the insurance coverage. Some insurance policies, their riders, exclusions, foldsin and folds-out, and appendages, are festooned in such ways that mechanical knowledge is a help in unfolding and laying them out so that the policies are in physically readable form. An insured, who is presented with forms and discussion in widely varying degrees of clarity, is entitled to know the precise nature of the insurance coverage that his premiums are buying. It is all too clear that contract language, while at times a great explainer, is at times a great obscurer. It is incumbent upon insurance companies to state clearly the perimeters of their coverage to those who entrust their security to them. Partly in the hope that that clarity might eventually come to pass, this case is affirmed. 41 Affirmed.