Anti-Stacking Provision Limits Liability Coverage for Fatal School Bus Crash

An insurance policy that covered seven vehicles, each with a $1 million per-accident limit, doesn’t provide $7 million in liability coverage for a fatal crash that involved only one of the covered vehicles, an Illinois appellate court ruled Thursday.

A panel of the Illinois 4th District Appellate Court reversed a McLean County Circuit Court decision that found ambiguous language on the policy’s declaration policy required Owners Insurance Co. to pay the aggregate limit for all three semitrucks and four trailers listed on the policy.

The appellate panel noted in its opinion that other Illinois appellate courts had decided similar cases in the same way as the McLean County judge because of the wording of several state Supreme Court decisions.

“However, the Illinois Supreme Court has made clear that its suggestion that listing the limits of coverage multiple times in the declarations may create an ambiguity ‘should not be construed as establishing a per se rule that an insurance policy will be deemed ambiguous as to the limits of liability anytime the limits are noted more than once on the declarations,'” the opinion says.

The case arose after December 2018 head-on collision involving a semitruck owned by Jason Farrell Trucking and a school bus carrying a junior varsity girls basketball team from Normal, Illinois. Driver Ryan Hute, an employee of Farrell Trucking, was driving the wrong direction on Interstate 74. The crash killed Hute, 34, and 72-year-old Charles Crabtree, a volunteer for the team, according to Illinois State Police.

Mark Kuhn, the driver of the varsity team’s bus, filed suit against Owners along with his wife Karen. They sought a declaration that the liability coverage limits for all seven vehicles listed on the policies should be “stacked” to provide a total of $7 million in coverage.

The trial court ruled in the Kuhns’ favor, finding that the policy was ambiguous because each $1 million coverage limit was listed separately on the declarations page along with a corresponding premium for the coverage; once for each of the three semitrucks and four trailers listed on the policy. Owners appealed.

The appellate panel said liability insurance attaches to vehicles, not individuals. Nevertheless, the Illinois Supreme Court in 2020 declined to adopt a rule barring the stacking of automobile liability coverage as a matter of law because the insurance policy in that case had a clear anti-stacking provision.

The panel said Owners had also included an anti-stacking provision in the policy it sold Farrell Trucking that was just as clear as the one before the state Supreme Court. The policy states that the $1 million per-accident liability limit “applies regardless of the number of … insured cars … or cars involved in the accident or loss.”

“We conclude that the antistacking provisions are not ambiguous on their face or when read together with the other provisions of the policy and the declarations,” the opinion says.

The panel reversed the trial court’s decision and remanded the case with instructions to enter summary judgment in favor of the insurer.

Top photo: This frame grab from video by WEEK/WHOI shows emergency personnel entering the back of a school bus that collided with a semitrailer that was headed the wrong way on an interstate late Wednesday, Dec. 5, 2017, near Downs, Ill. The driver of the truck and an adult on the bus were killed authorities said. The bus was carrying members of an Illinois high school girls’ basketball team. Several of the girls were injured in the head-on crash. (WEEK/WHOI via AP)