Skip to Content
News & Insights


Home-Owners Insurance Company v AMCO Insurance Company, unpublished per curiam decision of the Michigan Court of Appeals Docket No. 347089 (2020), 2020 WL 3475974.  The trial court had granted summary disposition to Home-Owners, ruling that the policy of insurance issued by AMCO to Kool Chevrolet was required to provide primary coverage to its $1 million limits to Benjamin Stewart, who was driving a car rented from Kool Chevrolet by his father when involved in an accident.  We argued in the trial court that the AMCO policy did not apply because Benjamin Stewart was a non-permissive user of the vehicle.  The trial court disagreed and held that the amendments to the owner liability statute, MCL 257.401(3)-(5), created a new class of permissive users comprised of immediate family members of the renter of a vehicle.  The trial court further held that since AMCO had denied coverage, its coverage for Benjamin Stewart was not limited to $20,000/$40,000 but pursuant to Auto-Owners v Martin, 284 Mich App 427 (2009), AMCO was required to provide coverage to the entire $1 million limits of the policy.  We appealed to the Michigan Court of Appeals and the Court of Appeals reversed holding that Benjamin Stewart was a non-permissive user of the vehicle, because pursuant to the Rental Agreement, he was not an “Authorized Driver” and was engaged in a “Prohibited Use” of the vehicle.  The Court of Appeals held that the trial court improperly conflated Kool Chevrolet’s responsibility to insure its vehicles under the No-Fault Act with Kool’s strict liability under the owner liability statute and that Kool was not in violation of the No-Fault Act.  The Court of Appeals further held that pursuant to DeHart v Joe Lunghamer Chevrolet, 239 Mich App 181 (1999), the terms of the Rental Agreement were violated when Benjamin Stewart drove the car, and therefore, Home-Owners, through its insured, Christopher Stewart, waived the right to hold Kool Chevrolet responsible under the owner’s liability statute.