EXCLUSION FOR LOSSES WHEN DRIVER UNLICENSED IS ENFORCED
Barry Zalma
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Great West sued Gates for damages resulting from the collision. Shortly thereafter Founders sued for Declaratory Judgment seeking a declaration that it was not obligated to provide insurance coverage for Gates, pursuant to an exclusion in the Policy, because Gates had been driving without a valid driver’s license at the time of the collision.
The trial court entered summary judgment in favor of Founders and directed the entry of final. Great West appealed.
The interpretation of an insurance policy is primarily a question of law for the court, and it is therefore a question which is particularly suited for summary judgment. Clear and unambiguous policy language must be given its ordinary meaning.
The policy exclusion provided that: “No coverage is afforded under any Part of this policy if, at the time of the accident, your insured car or a temporary substitute car is being operated by a person who: a. Is not a licensed driver...…”
Gates was driving without a valid driver’s license on the date of the collision. The trial court concluded that, by the plain terms of the Policy, insurance coverage was excluded.
It is uncontested that at the time Gates tendered his August premium the Policy remained in full force and effect. Founders did not contend otherwise.
The right of a third party to recover through liability insurance is not absolute.
The Court of Appeal concluded that Founders was entitled to judgment as a matter of law, and there is no genuine dispute of material fact.
ZALMA OPINION
Insurance policies are contracts. The terms and conditions of the policy, if unambiguous, must be applied as written. Since Gates was unlicensed at the time of the accident the clear and unambiguous language of the policy excluded coverage. The injured party, therefore, has no rights against Gates’ insurer. They can, of course, get a judgment against Gates and collect from his assets. An injured party has no right to recover from the tortfeasor’s insurer. The tortfeasor only has the opportunity to do so if the policy provides insurance coverage for the injuries claimed.
(c) 2022 Barry Zalma & ClaimSchool, Inc.
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Barry Zalma, Esq., CFE is available at http://www.zalma.com and [email protected]
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Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 54 years in the insurance business. He is available at http://www.zalma.com and [email protected]. Write to Mr. Zalma at [email protected]; http://www.zalma.com; http://zalma.com/blog; daily articles are published at
Zalma on Insurance
Insurance, insurance claims, insurance law, and insurance fraud .
By Barry Zalma
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On September 25, 2025, Leisz tendered a conditional admission and affidavit of consent. Leisz acknowledged the material facts of the complaint were true and she had violated the Montana Rules of Professional Conduct as alleged by ODC.
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A Lawyer Who Commits Insurance Fraud and Pleas to a Lower Charge Only Suspended
In The Matter Of: Naomi R. Leisz, Attorney at Law, No. PR 25-0150, Supreme Court of Montana (December 23, 2025) the Montana Office of Disciplinary Counsel (ODC) filed a formal disciplinary complaint with the Commission on Practice (Commission) against Montana attorney Naomi R. Leisz.
On September 25, 2025, Leisz tendered a conditional admission and affidavit of consent. Leisz acknowledged the material facts of the complaint were true and she had violated the Montana Rules of Professional Conduct as alleged by ODC.
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He Who Represents Himself in a Lawsuit has a Fool for a Client
In Pankaj Merchia v. United Healthcare Services, Inc., Civil Action No. 24-2700 (RC), United States District Court, District of Columbia (December 22, 2025)
FACTUAL BACKGROUND
Parties & Claims:
The plaintiff, Pankaj Merchia, is a physician, scientist, engineer, and entrepreneur, proceeding pro se. Merchia sued United Healthcare Services, Inc., a Minnesota-based medical insurance company, for defamation and related claims. The core allegation is that United Healthcare falsely accused Merchia of healthcare fraud, which led to his indictment and arrest in Massachusetts, causing reputational and business harm in the District of Columbia and nationwide.
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ZIFL Volume 29, Issue 24
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Zalma’s Insurance Fraud Letter (ZIFL) continues its 29th year of publication dedicated to those involved in reducing the effect of insurance fraud. ZIFL is published 24 times a year by ClaimSchool and is written by Barry Zalma. It is provided FREE to anyone who visits the site at http://zalma.com/zalmas-insurance-fraud-letter-2/
Zalma’s Insurance Fraud Letter
Merry Christmas & Happy Hannukah
Read the following Articles from the December 15, 2025 issue:
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