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Our insured has two cars—a company car insured by his employer and his wife's car, insured in our agency. When backing out of the garage, the insured's wife hit the company car in the driveway and damaged it. The insurer has refused to pay for the damage to the company car, based on two separate exclusions in the personal auto policy: vehicles provided for the regular use of an insured, and the care, custody, or control exclusion.
It is our opinion that neither exclusion applies, and that the claim should be paid under the property damage section by the personal auto insurer. The company car was not in the spouse's care, custody, or control; nor was she operating it. Who's right?
You are correct. The car that was damaged by the wife, i.e., the husband's company car, was not in her care, custody, or control. Also, the liability did not arise out of her use of the company car. The policy excludes liability coverage for loss or damage arising out of the use of vehicles that are not covered autos that are "furnished or available for the regular use" of any family member. Hitting the company car with the family car clearly does not qualify as making use of the damaged vehicle.
The situation is really no different from those where an insured damages a stranger's vehicle with the insured car. Just because the vehicle in this instance was her husband's company car makes no difference.
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