Shelley v. Nationwide Mutual Insurance

Concurring Opinion by

Spaulding, J.:

The sole question upon which this dispute turns is whether an injury to a passenger on a boat licensed for the transportation of passengers for hire, bnt not in actual use for this purpose at the time of the injury, is an injury within the definition of Section A of the insurance policy in question. I agree that it is.

The question arises because of the ambiguity of the language “water conveyance operated under a license for the transportation of passengers for hire” in Section A. The policy, which insures travel by land, sea, and air, contains no requirement that the licensed conveyance be in actual use for transportation of passengers for hire in order for the insured to qualify for the extensive benefits under Sections A and B of the policy.^* Thus, “licensed” vehicles in Section A are contrasted with vehicles of the “private passenger type” in Section C; and, “licensed” watercraft in Section A are contrasted with “watercraft not specified in Section A” in Section C.

Appellant’s husband, who holds a Coast Guard charter authorizing him to transport passengers for hire, is the owner and operator of the boat. Quite literally, at the time of the injury the boat was operated under a license for the transportation of passengers for hire. Such a license may be obtained only by an individual who had demonstrated his expertise in navigation and water safety by passing a series of examinations required by the Coast Guard in order to obtain a commercial license. The coverage afforded for injuries occurring on such a licensed watercraft is substantially greater than that for injuries occurring on other watercraft. The insurer, in affording this broader coverage, differentiated between the risks involved in the operation of licensed watercraft and the greater risk in the operation of other watercraft. This difference in risk is a result of the superior skill and expertise of the licensed operator, as established by the Coast Guard examinations, rather than the use to which the watercraft is put. Since the difference in coverage is based to a great extent upon the skill of the licensed operator, coverage under Section A of the policy should not be denied solely because the boat was not in actual use for transportation of passengers for hire at the time of the injury.

* Coverage for travel by air is provided in Section B, -which carries the same benefits and hospital indemnity as Section A. Benefits under Section C are 5% of those provided in Sections A and B and no hospital indemnity is offered.