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Does Insurance Cover Street Racing?

Colorado Springs Police responded to a crash scene last night following a report of two vehicles engaged in a speed contest around Fountain and Murray.  When police attempted to execute a traffic stop, one vehicle fled and another failed to negotiate a curve at southbound Powers and collided with another vehicle resulting in injuries to occupants of this other vehicle.  Following collisions like these, the most frequently asked initial question is, will insurance cover losses where street racing was involved?

First and foremost, our thoughts and prayers are with the innocent driver and passengers who were injured as a result of this collision.  For them, it was a matter of being in the wrong place at the wrong time when someone else engaged in what may well have been negligent, unlawful, and dangerous driving.

Many auto policies contain exclusions for damage or loss arising from racing.  Auto Insurance coverage is spelled out in the Policy Contract and almost all contracts contain an coverage exclusion for “liability arising from the sponsorship or participation in any organized or willful speed contest or racing in which your insured vehicle has active participation.”

What about coverage in a scenario like the one that occurred on August 27th?  This scenario is more common than most folks would imagine.  Damage often occurs after a race has ended, rather than during the race itself.  In these circumstances, auto insurers may extend liability coverage to the driver whose negligence resulted in the crash if it is determined that the crash occurred after the race ended, even if the difference in time is a mere few minutes or seconds.

The other insurance which will come into play in a scenario like this is the auto insurance of the injured driver and passengers who were wholly uninvolved in the street racing incident.  For purposes of injury expenses and claims, the coverage likely to apply there for a Colorado originated policy and loss would be Medical Payments Coverage and/or Uninsured/Underinsured Motorist Coverage.  In the most simple terms, Medical Payments Coverage covers loss-related medical expenses regardless of fault.  Uninsured/Underinsured Motorist Coverage covers a Bodily Injury claim that an insured person is entitled to recover from a negligent party who either had no insurance or who did not have enough insurance to make the injured claimant whole.

We condemn speed contests on public roads and highways because the risk to the motoring public is simply too great. 

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