Founders Insurance Company (“Founders”) appeals the trial court’s declaratory judgment order in favor of Appellees Virginia Olivares, Linda Vara, Daniel Farley, and AAA Chicago Motor Club Insurance Company (collectively “Appellees”). The Issue here is whether the trial court properly concluded that Founders was barred from denying coverage to Farley because he was an “excluded driver” under Vara’s auto insurance policy with Founders.
Conclusion (slip op. at 13): The trial court properly concluded that Founders is estopped from denying coverage to Farley because he is an “excluded driver” under Vara’s auto insurance policy with Founders. Affirmed.
Key Analysis (slip op. at 11, 12): Founders had sufficient knowledge of facts that would have permitted it to deny coverage based on Farley’s status under the policy as an “excluded driver” . . . Because there was no proper reservation of rights by Founders as to the “excluded driver” defense, Farley was not aware at the time he accepted defense counsel from Founders that Founders would later deny coverage if it were found that he was the driver of the Cutlass at the time of the accident. In such a situation, Farley could not make an intelligent choice between retaining his own counsel or accepting Founders’ defense counsel.