Court Opinion

ID: 9707117
Source: CourtListenerOpinion
Date Created: 2023-08-26 02:02:49.47835+00
Date Added: 2024-06-11T18:22:28.285125
License: Public Domain

NIX, Chief Justice,
concurring.
Although I agree with the result reached in this case, it is incumbent upon me to explain the rationale employed since I do not share the view expressed by the majority of this Court in Standard Venetian Blind Co. v. American Empire Insurance Co., 503 Pa. 300, 304-305, 469 A.2d 563, 566 (1983). In the dissent in that case I noted that both the view expressed by the majority and that expressed by the concurring members of the Standard Venetian Blind Court were “equally nebulous and neither is appropriate in the area of insurance contract interpretation.” Id., 503 Pa. at 321, 469 A.2d at 574. I then proceeded to set forth the view I deemed appropriate.
An insurance contract is essentially a contract of adhesion. Its terms are not bargained for but rather dictated by the insurer. Thus the insured’s awareness and understanding of exclusions set forth in an insurance policy should not be presumed from the mere presence of such exclusions among the policy’s terms. The very fact that the insurer prescribes particular exclusions indicates an assumption that the purchaser could otherwise reasonably expect to be covered against the risk so excluded.
*429It is therefore crucial that the insurer explain and the insured understand the precise nature of the policy’s limitations. For this reason I would apply the test adopted by the Superior Court in Hionis v. Northern Mutual Insurance Co., 230 Pa.Super. 511, 327 A.2d 363 (1974), employed by both that court and the trial court in this matter, and hold the insured to a standard of proving the insured was aware of and fully appreciated the effect of exclusions in the insurance policy before permitting the insurer to escape its duty to defend the insured.
Id., 503 Pa. at 321, 469 A.2d at 574.
This reasoning is applicable where an uninitiate is seeking insurance coverage. In this case appellee was a contractor by trade who, in the performance of regular business, was required to secure insurance coverage of this nature. In such a situation the inequality of bargaining power between the insured and the company that I referred to in my analysis in Standard Venetian Blind is not present. Since there was no ambiguity in the language of these exclusions and, since I agree with the majority’s determination of their applicability, I concur in the mandate entered in this case.