Opinion ID: 1406121
Heading Depth: 2
Heading Rank: 1

Heading: what does covered mean in the motor vehicle definitions paragraph?

Text: Initially, it is apparent that this accident falls within the general Coverage language of the Uninsured Motorists section of the policy. Julie suffered bodily injury resulting from an accident with a driver of an uninsured vehicle. It is equally apparent, however, that if Julie were occupying a motor vehicle owned by the Hillmans but not insured under the policy, Uninsured Motorists Exclusion number four would apply, and there would be no policy coverage. The Hillmans' position is that the final sentence of the motor vehicle definition, [o]ther motor vehicles designed for use mainly off public roads are covered when used on public roads (emphasis added), constitutes an affirmative grant of coverage to persons operating off road vehicles on public roads. Nationwide, on the other hand, argues that the words are covered in the definition mean that off road vehicles are included in the motor vehicle definition when they are operated on public roads. Thus, they conclude that Julie was operating an owned, but uninsured, motor vehicle and her accident is expressly excluded under the policy. Insurance policies are contracts. Thus, the liability of an insurer is generally determined by the terms of the policy which it has issued. State v. Underwriters at Lloyds, London, 755 P.2d 396 (Alaska 1988). However, since an insurance policy is a contract of adhesion, it will be construed according to the principle of reasonable expectations: The objectively reasonable expectations of applicants and intended beneficiaries regarding the terms of insurance contracts will be honored even though a painstaking study of the policy provisions would have negated those expectations. Id. (quoting R. Keeton, Basic Text on Insurance Law § 6.3(a), at 351 (1971)). Another rule of construction applicable to insurance policies is that ambiguities in the contract language should be resolved in favor of the insured. U.S. Fire Ins. v. Colver, 600 P.2d 1, 3 (Alaska 1979). However, this rule does not apply to every case in which the parties disagree as to the interpretation of a term; ambiguity exists only when the contract, taken as a whole, is reasonably subject to differing interpretations. Modern Constr. v. Barce, Inc., 556 P.2d 528, 529 (Alaska 1976), quoted in Jarvis v. Aetna Casualty & Sur., 633 P.2d 1359, 1363 (Alaska 1981). We find that the only reasonable interpretation of the motor vehicle definition is that advanced by Nationwide, i.e., that the sentence on which the Hillmans rely means that motorized vehicles designed mainly for use off public roads, such as an ATV, are motor vehicles within the policy definition when they are used on public roads. [1] The definitional section is distinct from the coverage provisions, and cannot logically be read as providing any substantive additions to the coverage section of the policy. Further, we have no basis for concluding from extrinsic evidence that an insured in the position of the Hillmans would have held an objectively reasonable expectation of coverage. Mrs. Hillman stated to the insurance adjuster investigating this case that she and her husband had thought that insurance was unobtainable for the ATV.