Best Buy has filed a suit against its longtime insurers, alleging the companies are wrongfully forcing the retail giant to shoulder millions in settlement costs from a deadly 2021 traffic accident.
The dispute centers on which of three insurance policies issued by XL entities should cover a multi-million-dollar settlement arising from a fatal collision involving a subcontractor's vehicle. At issue is a five million dollar gap between deductibles under different policies, a difference Best Buy says flies in the face of plain policy language.
The retailer alleges, in a complaint filed in Minnesota federal court, that Greenwich Insurance Company, XL Specialty Insurance Company, and XL Insurance America are attempting to shift financial responsibility by invoking the wrong coverage.
On June 23, 2021, a delivery truck owned by SAAV Appliance Installers struck a passenger vehicle on Interstate 210 near Montrose, California. Both occupants of the passenger vehicle were killed. Other drivers in the vicinity suffered injuries, and several vehicles were damaged.
The driver, Humberto Gonzalez, was a SAAV employee allegedly under the influence of alcohol, methamphetamine, and amphetamine at the time of the crash. He was also driving without a valid driver's license, which had been suspended in 2018 due to numerous traffic tickets and for failing to appear in court. The truck was carrying an appliance for delivery to a Pacific Sales customer. Pacific Sales is a Best Buy subsidiary.
SAAV had contracted with Best Buy in 2018 to deliver and install products as an independent contractor under a Delivery and Installation Services Agreement.
Wrongful death and personal injury lawsuits followed in Los Angeles Superior Court. Plaintiffs eventually amended their complaints to name Best Buy and its subsidiaries Best Buy Stores, L.P. and Best Buy Warehousing Logistics LLC, asserting vicarious liability claims based on SAAV's independent contractor status. The complaints also alleged negligent hiring, engagement, supervision, retention, and entrustment of Gonzalez.
Best Buy and XL accepted a mediator's proposal to settle the litigation for a confidential sum, in excess of several million dollars.
Best Buy tendered the settlement to XL for coverage under its General Liability Policy and follow-form Excess Policy, which together provide combined limits of 11 million dollars with a 1 million dollar self-insured retention. According to the filing, Best Buy set up the matter to be adjusted under the GL Policy and administered the claim throughout the litigation under that policy, and XL did not dispute the classification.
But XL allegedly denied the claim under those policies, instead taking the position that the Auto Policy is the only policy that covers the settlement, which carries a 6 million dollar deductible.
The coverage fight turns on the interpretation of exclusions and "other insurance" clauses across multiple policies.
The GL Policy provides broad coverage for bodily injury or property damage but excludes coverage arising from the ownership, maintenance, use, or entrustment of any auto owned or operated by the insured. That exclusion applies even if claims allege negligent supervision, hiring, employment, training, or monitoring, provided the occurrence involved an auto owned or operated by the insured.
However, the GL Policy's "other insurance" provision states the policy is primary except in specified situations. It becomes excess over other insurance if the loss arises out of the maintenance or use of autos to the extent not subject to the auto exclusion.
The Auto Policy provides primary insurance for autos Best Buy owns and excess coverage for autos it does not own. The policy covers damages from accidents resulting from the ownership, maintenance, or use of a covered auto, defined as any auto.
The Excess Policy follows the terms of the scheduled underlying insurance, which includes both the GL Policy and the Auto Policy. It pays damages in excess of underlying insurance once that coverage has been exhausted by actual payment of loss.
Best Buy alleges XL has ignored the plain language of the GL and Excess Policies and breached its indemnity obligation. The retailer argues the settlement falls within coverage designed to protect it from vicarious liability and negligent contracting claims involving independent contractors.
The case illustrates recurring tensions in commercial insurance over which policy responds when multiple coverages potentially apply. Such disputes often center on the interplay between general liability and auto policies, particularly when claims involve both operational negligence and vehicle use.
Best Buy seeks a declaration that the GL and Excess Policies provide coverage up to the combined 11 million dollar limit, subject only to the 1 million dollar retention, and that the Auto Policy does not apply. The company also seeks compensatory and consequential damages for breach of contract, plus interest, attorneys' fees, and costs.
The complaint was filed November 7, 2025, in the United States District Court for the District of Minnesota. No court ruling has been issued on the allegations.
