A South Carolina federal judge has handed Progressive a clean win and trimmed Old Republic's payout on a $1 million trucking judgment to $750,000.
The May 6 decision turned on two issues commercial auto insurers wrestle with constantly – retroactively pulling a vehicle off a scheduled auto policy, and how much an MCS-90 endorsement actually pays.
The crash happened on January 9, 2019, on I-26 East in South Carolina. A 2018 Freightliner driven by Santokh Singh Sangha hit a 2019 Kia carrying Mary Foster. Foster sued Sangha and United Transportation Lines, Inc. in state court. No one defended the case, and a special referee entered a $1,000,000 default judgment in December 2021.
The coverage fight that followed had carriers on both sides. United Financial Casualty Company – Progressive – sued in January 2024 for a declaration that it owed nothing. Foster cross-claimed against Old Republic Insurance Company, pointing to its MCS-90 endorsement.
Progressive's argument hinged on a paperwork sequence worth retelling.
Two days before the crash, an associate of the carrier emailed Progressive's agent, RJS Insurance Services, asking to add the Freightliner and Sangha to the policy. RJS never received the original email. About four hours after the accident – with neither side aware a crash had occurred, the court found – the associate forwarded it. Calls and emails followed. By 5:56 p.m. Pacific Time that evening, RJS had used Progressive's agent portal to add the Freightliner, backdated to January 7.
Less than an hour later, the carrier reversed course. "I spoke with Ali and he does not want to pay $35000 just to have two trucks on the road. He is having them turn around and come back to the yard. As of right now, please do not make any changes," the associate wrote. The next morning she added: "Please be advised that we did not lease the vehicles after all after finding out how much it will cost us to insure them. [P]lease do not process the change."
Progressive agreed to reverse the additions retroactive to January 7. A January 11 declarations page revision showed the Freightliner added effective January 7. A January 12 revision showed it removed – also effective January 7.
Old Republic and Foster argued the retroactive removal could not stand. They pointed to a clause stating: "If you ask us to delete a vehicle from this policy, no coverage will apply to that vehicle as of the date and time you ask us to delete it."
Judge Jacquelyn D. Austin read it differently. The clause stops coverage going forward from a deletion request – it does not prevent an insurer and insured from agreeing to remove coverage for a period before the request. The January 12 revision plainly removed the Freightliner effective January 7, before the crash. Progressive owed nothing.
That kicked the loss over to Old Republic and its MCS-90 endorsement, the federally required surety that backstops the public when a motor carrier's underlying insurance does not respond.
Old Republic had stipulated that if Progressive's policy did not apply and United Transportation was acting as a for-hire motor carrier, the MCS-90 would satisfy the unpaid portion of the default judgment "up to the federal financial responsibility limits."
So, the only question left was the size of that backstop. Foster pushed for $1 million, the figure Old Republic had written into the MCS-90's blank for the underlying primary policy limit. Old Republic argued the cap was $750,000 – the federal minimum financial responsibility for non-hazardous cargo on this trip.
The court took $750,000. The MCS-90 form refers to liability "within the limits of liability described herein," and those limits, the judge held, include both the figure in the blank and the figures in the form's Schedule of Limits. Reading it any other way would make the Schedule of Limits meaningless. And the endorsement exists to satisfy the federal minimum, not to top it up.
"[T]he MCS-90 was not designed to be a vehicle for motor carriers to altruistically provide the public with greater protection than the law requires," Judge Austin wrote.
The court noted that two district courts – in Texas and Indiana – have decided the same question the other way on near-identical facts. It called those rulings unpersuasive.
Progressive owes nothing. Old Republic owes $750,000 under its MCS-90. Foster's and Old Republic's cross-motions were each granted in part and denied in part.
