Opinion ID: 2612914
Heading Depth: 1
Heading Rank: 3

Heading: oklahoma's compulsory liability insurance law

Text: Oklahoma's Financial Responsibility Act [Act] requires that owners maintain liability insurance for their automobiles. [10] The compulsory liability insurance article in the Act [11] mandates that all vehicle owners keep in force liability insurance or other authorized security at not less than the minimum required by § 7-204 [12] unless a vehicle is exempt by statute. The Act's principal purpose is to protect the public using the highways from financial hardship which may result from the use of automobiles by financially irresponsible persons. [13] Any vehicle operating on the Oklahoma highways must hence be secured against liability to innocent victims of the negligent operation of insured vehicles. [14] This clearly articulated public policy of our compulsory insurance law plainly overrides contrary private agreements that restrict coverage whenever the contractual strictures do not square with the purpose of the Act. [15] Oklahoma jurisprudence teaches that clauses in insurance policies which operate to deny coverage to the general public are void as contrary to statutorily articulated policy. [16] Among those condemned exclusionary provisions are age limits, [17] geographical restrictions, [18] passenger exclusions, [19] and policy covenants that would exclude from coverage all potential claimants. [20] Insurance policy clauses that place beyond coverage a narrowly defined class of potential victims have been upheld as not contrary to public policy. [21] The insurer in the present case appears not to be required by California law to offer UM coverage to its insured. The pertinent exclusionary clauses, read conjointly, operate to strip Thomas of any insurance protection under the policy. [22] Whenever a passenger, who is a resident of the common household of the named insured, is left without minimum protection of insurance indemnity for the harm sustained in Oklahoma while an accupant of an automobile, out-of-state policy falls short of the minimum limits of liability coverage required by the Oklahoma compulsory insurance law. We hold that the exclusionary clauses in the California policy are invalid insofar as they operate to defeat the minimum protection afforded by our compulsory insurance law, and are hence unenforceable against a claim for an amount up to our law's statutory mandate  $10,000 for each person, $20,000 for each accident and $10,000 for property damage. [23]