Most Texas automobile liability insurance policies include a family member exclusion which excludes liability coverage for any claim made by a family member against a family member. The insurance companies argue that providing coverage for claims by family members against family members would encourage fraud and collusion. Insurance companies suggest that a parent might intentionally cause an accident and injure their child in order to give their child an opportunity to make a claim under their insurance policy. However, the more likely motivation for the family member exclusion is simple greed. Far and away the most likely person to be injured by a family member while operating a motor vehicle is another family member. In typical fashion the insurance companies have attempted to avoid coverage for the single largest group of persons who might need coverage.
The family member exclusion is in direct conflict with the Texas Motor Vehicle Safety-Responsibility Act which requires all drivers to have public liability insurance in the minimum required amounts. The current minimum required amounts are $25,000.00 per person, $50,000.00 per accident, and $25,000.00 in property damage coverage. The Texas Supreme Court in National County Mutual Fire Insurance Company v. Johnson saw through the insurance industry’s claimed justification for the family member exclusion and held that the family member exclusion conflicted with the Texas Motor Vehicle Safety-Responsibility Act, had no rational justification, conflicted with Texas public policy, and failed to serve the interests of the citizens of Texas. The Texas Supreme Court held that the family member exclusion was void to the extent that it reduced the available coverage below the minimum required by Texas law.
The fact that the family member exclusion is invalid has not stopped insurance companies from including it in their policies or insurance adjusters from telling claimants that there is no coverage for injuries to family members. It is important that Texans be knowledgeable regarding their insurance in order to combat fraud by insurance companies.
For more information contact a Tyler Car Wreck Attorney today.