Does Insurance Follow the Car or Driver – Ohio Supreme Court Clarifies Which Party is Responsible in Crash Involving a Borrowed Car

It is a common enough scenario: your insured’s teen driver borrows his friend’s car, while they are driving, your teen driver loses control of the vehicle and causes property damage and injures their passengers.

This was the exact scenario in a recent Ohio Supreme Court ruling – Acuity v. Progressive. In this case, Ashton Smith borrowed a friend’s car and got into a crash that damaged a city utility pole and injured three passengers. The city filed a claim for damages and the three passengers in the car sought coverage for their injuries.

Smith was insured by Acuity. The car’s owner was insured by Progressive. The question is which insurer is on the hook for the accident?

The Court found insurance policies are contracts, so the answer comes down to contract interpretation. Under the plain language of the Progressive policy, Smith was not an “insured person” when he was driving his friend’s car. But he was covered under the plain language of the Acuity policy. Therefore, the Court concluded that Acuity must provide coverage for the accident in question.

In a 5-2 decision, the Supreme Court found a policy owned by the driver’s father provided coverage when his son was driving a vehicle with permission from the vehicle’s owner. The decision reversed an Eleventh District Court of Appeals ruling that the car owner’s insurer would have to pay for the accident.

Writing for the Court majority, Justice Pat DeWine wrote that under the plain language of the car owner’s Progressive policy, the driver was not covered because the teen was covered as a driver under his father’s auto insurance policy issued by Acuity.

Under the Progressive policy, the definition of an “insured person,” excludes any person who drives a car covered by the policy but who is insured by another liability policy. Specifically, it states “insured person” means: “any person who is not insured for liability coverage by any other insurance policy * * * with respect to an accident arising out of that person’s use of a covered auto with the permission of you, a relative, or a rated resident.”

Under the Acuity policy, it defined “insured person” to include “[y]ou or a relative while using a car * * * other than your insured car with a reasonable belief of having permission to do so.”

The Court held, “Where two insurance policies exist, and where under the plain and natural reading of both policies, one policy provides coverage and the other does not, we must honor the parties’ agreement,” Justice DeWine wrote. Chief Justice Sharon Kennedy and Justices Patrick Fischer, Melody Stewart, and Joseph Deters joined Justice DeWine’s opinion.

In a dissenting opinion, Justice Jennifer Brunner wrote that a close reading of the Acuity policy does not plainly establish that the driver was insured while driving a borrowed automobile. She wrote the Eleventh District applied Supreme Court precedent and correctly determined that Progressive should have covered the damages. Justice Michael P. Donnelly joined Justice Brunner’s opinion.

So, what does this mean for Ohio’s insurance agents? First, it means some policies provide liability coverage only if the named insured is driving the auto, while some liability policies follow the driver, and some follow the vehicle. It is important for agents to review their clients’ auto policies to ensure they understand who is insured in this common scenario.

This ruling is an example of the Ohio Supreme Court overturning a ruling by an Appellate Court that would have introduced confusion and questions into which policy provides coverage in a quite common situation, the simple borrowing of a car. The Ohio Supreme Court used judicial restraint in this ruling and strictly interpreted the language in the insurance policy to determine who was an “insured person” according to the policy language and which company was liable for coverage.

The implications of the Appellate Court ruling would have overturned the plain language in the insurance policy that the driver was not an “insured person” under the borrowed car owner’s insurance policy.

This case highlights why OIA and the OIA PAC are involved in Supreme Court elections. We support a judicial philosophy of strict constructionist and judicial restraint, and we expect judges to rule on cases strictly based on what language is in the law and policy. Not to substitute their own judgement and interpretation into the language.

In 2024, we will again be electing Justices to the Ohio Supreme Court that will be presented with similar cases to this and will have to make their own ruling. It is vital for OIA to vet the judicial philosophy, temperament and rulings and then get engaged in the electoral process through the OIA PAC.

Please reach out to John Wells, OIA’s Government Affairs Manager at for questions on this issue, how to donate to the OIA PAC or any advocacy issues.

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