Opinion ID: 2586252
Heading Depth: 4
Heading Rank: 2

Heading: The Division of Insurance approved Form 9330.

Text: Nelson also argues that the named driver exclusion in Progressive's Form 9330 exceeds the scope of AS 28.20.440( l ), citing the following language on Form 9330: WARNING: If you have asked us to exclude coverage under this policy for any person, this policy will not meet the minimum coverage requirements of either Alaska's mandatory automobile insurance or financial responsibility laws. Nelson contends that subsection .440( l ) does not contemplate that insurers could exclude the named policyholder from coverage, and asserts that Progressive's warning on Form 9330 indicated it knew its attempt to limit coverage is prohibited by law. On the contrary, however, Progressive's warning was in compliance with Division of Insurance regulations intended to make policyholders aware of the law. The Division of Insurance recognized that subsection .440( l ) allowed policyholders to exclude members of their household from their policy in exchange for a reduction in premium payments. The Division of Insurance bulletin 97-07 states: A named driver exclusion should be signed by the named insured each policy period, and a policy with a named driver exclusion should carry a warning that the policy may be inadequate to satisfy the obligations of a motor vehicle owner or operator under the Alaska Motor Vehicle Responsibility Act or the Alaska Mandatory Insurance Law. Bulletin 98-10 superseded bulletin 97-07. It required insurers to file and receive approval from the director of the division for policy forms that comply with subsection .440( l ). [59] Bulletin 98-10 states: [a]n automobile liability insurance policy that limits coverage for named persons other than as specified in AS 28.20.440( l ) must clearly indicate that the policy does not meet the minimum coverage standards of either Alaska's mandatory automobile insurance or financial responsibility laws. Bulletin 98-10 requires that exclusions that go beyond AS 28.20.440( l ) must be reviewed by the Division of Insurance. Progressive submitted, and the division approved, Progressive's Form 9330. We have not directly addressed what weight we give to Division of Insurance approvals of insurance forms. [60] We have previously recognized that other jurisdictions have suggested that courts could give substantial deference to such approvals. [61] In Government Employees Insurance Co. v. Graham-Gonzalez, [62] we looked to the division's exercise of its delegated authority to regulate forms under Title 21, and its subsequent approval of the application form in question, in finding that a statute requiring insurers to offer under insured motorist coverage did not require application forms to state the amount of the policy premium. We noted that even if we applied our independent judgment, the division's approval of forms . . . would be entitled to some deference. In such cases this court gives `some weight to what the agency has done, especially where the agency interpretation is longstanding.' [63] The Division of Insurance was concerned about policyholders unwittingly executing named driver exclusions without understanding the scope of potential risks involved. The division encouraged insurance companies to develop a disclosure form. Progressive included a plain warning on Form 9330 notifying insureds of the risks of the exclusion. [64] It appears the warning language on Form 9330 was in response to the division's requirements. The division required insurers to obtain approval from the director of the division for this exclusion, and Progressive did so. The division approved Form 9330. Lilii Ulisese signed it. The division clearly intended that Progressive's exclusion would eliminate a named policyholder's coverage for claims arising out of the excluded driver's operation of the vehicle. As in Graham-Gonzalez, it is unnecessary for us to determine the precise standard of review we should apply to the division's approval of Form 9330. [65] Even if we give only some weight to the division's approval of Form 9330, it is consistent with our view of subsection .440( l ). We have already noted that the purpose of subsection .440( l ) is to allow policyholders to obtain affordable auto insurance by giving them the option to exclude a high-risk member of their household from their policy. The division approved the form, and in doing so must have contemplated the potential risks that could arise. For these reasons we find that subsection .440( l ) and Form 9330 provide a narrow exception to the minimum liability coverage otherwise required by AS 28.20 and AS 28.22. [66]