A recent situation reminded me of an often overlooked and underutilized legal gem – the innocent co-insured doctrine. This blog post is aimed at reminding policyholders and policyholder advocates of this doctrine, which could breathe life into a claim that, at first blush, seems untenable due to the alleged misconduct of one of multiple named insureds.
In Kattoum v. New Hampshire Indemnity Company,1 Florida’s Second District Court of Appeal reversed the trial court’s determination that a wife’s intentional destruction of her husband’s vehicle precluded the innocent husband from coverage under the auto policy that named both the husband and wife as insureds. The Kattoum court’s decision emanated from the innocent co-insured doctrine:
Florida has long recognized that an insurer is not liable to indemnify an insured for losses directly caused by the fraud or misconduct of that insured. However, because insurance policies frequently provide coverage for more than one insured, the question arises as to whether the policy is intended to insure all named insureds jointly or whether the coverage is severable so as to provide separate coverage of the respective interests of two or more joint owners and co-insureds. If the policy provides joint coverage, the fraud or misconduct of one insured can be imputed to an “innocent co-insured.” However, Florida’s courts have held that the intentional misconduct of one insured will only be imputed to an innocent co-insured where the insurance policy contains a clear statement that the misconduct of one insured abrogates the coverage of all insureds.2
It is certainly common for policies to name more than one insured. And the Kattoum decision is not unique to the auto insurance context; the innocent co-insured doctrine has been applied in other insurance contexts.
It is typically a fine line between whether a policy is joint or severable. It would accordingly behoove an innocent co-insured to consult with an insurance attorney regarding a claim that has been denied due to the alleged misconduct of another insured before throwing in the towel on the claim.
1 Kattoum v. New Hampshire Indem. Co., 968 So. 2d 602 (Fla. 2d DCA 2007).
2 Id. at 603 (internal citations omitted).