Academic journal article Journal of Risk and Insurance

Insurer's Duty to Defend: Allstate Insurance Company V. RJT Enterprises, Inc

Academic journal article Journal of Risk and Insurance

Insurer's Duty to Defend: Allstate Insurance Company V. RJT Enterprises, Inc

Article excerpt

Allstate Insurance Company v. RJT Enterprises, Inc., 22 Fla. L. Weekly S49 (Florida Supreme Court, January 23, 1997)

The Florida Supreme Court has ruled that a lessee's insurer has no duty to defend the lessor who is not named in the policy. In this case, John Weinerth had purchased bodily injury liability coverage from Allstate. He rented a car from RJT Enterprises, Inc. The rental agreement provided that the lessee would provide primary insurance coverage up to the full policy limits. The language in the rental contract is authorized by Section 627.7263 F.S. which authorizes a shift in primary coverage from the lessor to the lessee's insurer.

Weinerth was involved in an auto accident with Isaiah Young. Young brought suit against Weinerth and RJT, Inc. Allstate refused to provide a defense to RJT and settled with Young for the policy limit of $10,000. Young pursued an action against RJT and RJT was required to provide its own defense. Young recovered no judgment from RJT and RJT claimed reimbursement for attorney's fees in excess of $30,000 from Allstate.

The supreme court found that the duty to defend is a responsibility separate and distinct from the duty to provide primary coverage. The supreme court also found that the legislature did not intend to burden insurers of lessees with the duty to defend lessors not named in, and in fact excluded from, the lessee's policy. …

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