Auto-Owners Insurance Company v. Csaszar, 893 F.3d 729

Auto-Owners insured Frank and Nancy Csaszar and their daughter Jennifer; when renewing, insurer required and the parents agreed to a named-driver exclusion that stated the policy “shall provide no coverages … arising out of [Jennifer’s] operation or use of any automobile.”
The policy covered three scheduled vehicles and included up to $500,000 in UM/UIM coverage; Jennifer separately owned a Subaru insured by Geico with $300,000 UM/UIM.
Jennifer (an excluded driver under her parents’ policy) was rear-ended while driving the Subaru by an uninsured motorist; she recovered Geico’s $300,000 limit and sought the $500,000 UM/UIM limit from Auto-Owners.
Auto-Owners denied coverage and sued for a declaratory judgment that the exclusion barred Jennifer from all coverage, including UM/UIM; Jennifer counterclaimed. The district court granted summary judgment to Auto-Owners.
On appeal (diversity; applying Colorado law), the Tenth Circuit affirmed: the exclusion unambiguously barred Jennifer from coverage when she drove any automobile, and that exclusion did not violate Colorado public policy.

Issue	Plaintiff's Argument (Csaszar)	Defendant's Argument (Auto-Owners)	Held
Whether the excluded-driver clause unambiguously bars coverage for injuries while Jennifer drove an unscheduled vehicle	The exclusion applies only to vehicles "to which this policy would otherwise apply" (i.e., scheduled vehicles); ambiguous and should be construed for coverage	The clause precludes coverage "arising out of operation or use of any automobile"—plain meaning is any automobile, scheduled or not	Held: Unambiguous; exclusion bars coverage when Jennifer drives any automobile
Whether excluding a resident relative from UM/UIM coverage violates Colorado public policy	Public policy forbids denying UM/UIM to an innocent insured injured by an uninsured motorist; UM/UIM protects non-fault victims regardless of their driving record	Colorado law allows insurers to exclude a resident relative from liability and correspondingly from UM/UIM; statute mandates UM/UIM only for "persons insured thereunder"	Held: No public-policy violation; Massingill controls—denying UM/UIM to a resident-relative excluded from liability is permissible

Massingill v. State Farm Mut. Auto. Ins., 176 P.3d 816 (Colo. App. 2007) (held insurer may deny UM/UIM to a resident relative excluded from liability coverage)
DeHerrera v. Sentry Ins., 30 P.3d 167 (Colo. 2001) (policy diluting statutorily mandated UM/UIM coverage violates public policy)
Mountain States Mut. Cas. Co. v. Roinestad, 296 P.3d 1020 (Colo. 2013) (reasonable-expectations doctrine for insurance exclusions)
Bailey v. Lincoln Gen. Ins., 255 P.3d 1039 (Colo. 2011) (coverage terms not ambiguous in a technical sense may nonetheless fail the reasonable-expectations test)
Cotter Corp. v. Am. Empire Surplus Lines Ins., 90 P.3d 814 (Colo. 2004) (apply contract-interpretation principles to insurance policies)
Philadelphia Indem. Ins. v. Lexington Ins., 845 F.3d 1330 (10th Cir. 2017) (summary-judgment standard reaffirmed)