Med Pay On Homeowners Policies

Homeowners in Grand Prairie, Arlington, Mansfield, Britton, Crowley, Burleson, Benbrook, Lillian, Godley, Glen Rose, Acton, Cresson, and other places in Texas, might be interested in this case.
This case is from the El Paso Court of Appeals and was decided on April 20, 2011. The style of the case is, Pamela Rust v. Texas Farmers Insurance Company.
This is a case where Pamela Rust brought suit seeking medical payment benefits from Texas Farmers Insurance Company under two homeowner policies that it had issued to Frank Kurosky, her father.
Here are some of the facts in the case.
Kurosky owned two adjacent lots in Haltom City insured by Farmers under separate homeowner liability policies. Kurosky resided at the first property, located at 4325 Fossil (25-Fossil), and was the sole named insured for that property. Kurosky rented the property next door, located at 4333 Fossil (33-Fossil), to his daughter, Pamela Rust, and both Kurosky and Rust were named insureds on that policy.
Allegedly, Rust was operating a riding lawnmower at the 33-Fossil rental property, the lawnmower overturned on a steep, unfenced incline at the back of the property, causing her life threatening injuries and resulting medical bills in excess of $100,000. Rust submitted the medical bills to Farmers seeking a $5,000 payment under Kurosky’s homeowner’s policy. This lawsuit commenced after Farmers refused to pay Rust’s claim for benefits.
In this case there was also a lawsuit under the liability portion of the policy which will not be discussed.
Regarding the 33-Fossil rental property and the policy relating thereto, Farmers argued that while the policies provided property and liability coverage, they did not cover medical expenses incurred by a named insured or resident at the insured location nor did they cover medical expenses unless the insured person was liable for the bodily injury occurring at the insured location. Therefore, Farmers argued that Rust could not recover medical payment benefits under the 33-Fossil policy because she was both a named insured and a resident of that insured property.
Rust filed a motion for summary judgment asking the court to rule as a matter of law that she was entitled to the medical benefits. Farmers repeated its argument that Rust could not succeed under the 33-Fossil policy because she was an insured and a resident, and therefore, the policy coverage was inapplicable to Rust. Farmers stated that for Rust to recover any monies, even under the 25-Fossil property, that Rust would have to show that the injury occurred on the 25-Fossil property and this is contrary to her allegation that her injuries were caused by, among other things, a steep incline at the back of the 33-Fossil property. Rust had presented no evidence that some condition on the 25-Fossil property caused any of her injury.
In citing Texas law, this court stated, “In general, an insured bears the initial burden of showing that there is coverage under an insurance policy, and the insurer bears the burden of proving the applicability of an exclusion that permits it to deny coverage. When an insurer proves the applicability of an exclusion, the burden shifts to the insured who must demostrate that coverage exists under an exception to the exclusion. (This is found in Texas Insurance Code, Section 554.002). Exclusionary language in the contract or an insurer’s claimed exception to coverage constitutes an avoidance or an affirmative defense.”
The policies at issue at similar and provide that the medical-payments-to-others provision of the policies specifies that Farmers will pay reasonable medical expenses for necessary medical services furnished to a person to whom the coverage applies, and specifies that coverage thereunder applies, in part, to:
Persons on an insured location with permission of an insured; or Persons off an insured location if the bodily injury is:
a. the result of a condition on the insured location or the ways immediately adjoining;
b. caused by the activities of the insured; or c. caused by a residence employee in the course and scope of employment by an insured.
For those persons, the policies provide that Farmers will pay reasonable medical expenses for necessary medical services furnished for an occurrence causing bodily injury. The medical coverage policy limits are $1000 per person under the 25-Fossil policy and $5000 under the 33-Fossil policy.
The court then discussed the exclusions.
There were three exclusions to coverage. Both policies exclude from coverage bodily injury or personal injury to any insured or any resident of the residence premises. They also exclude coverage for an insured’s bodily injury and personal injury arising from, during the course of, or in connection with the rental of any property or any part of any premises by an insured. An exception within the policies provides in relevant part that this rental property exclusion is not applicable to the rental of that part of an insured location which is rented either on an occasional basis for sole use as a residence or to no more than two roomers at the same time for sole use as a residence. Also included is an other-property exclusion for bodily or personal injury arising from, during the course of, or in connection with a location other than an insured location which is owned by an insured, rented to an insured, or rented to others by an insured.
Based on the plain policy language and the exclusions therein and the law in Texas, the court ruled in Farmers favor.