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Indian Harbor sues over Alabama hi-rail crash coverage vs State Farm
Indian Harbor filed the case in federal court on Aug. 10, 2026, seeking a declaration that it has no duty to cover the railroad-crossing collision that it says is excluded under its policy’s auto terms.
Two insurers are seeking a court ruling on who must pay insurance claims tied to an Alabama hi-rail crash, according to Insurance Business. Indian Harbor Insurance Company filed suit in federal court on Aug. 10, 2026, asking for a declaration that it does not have to cover a railroad-crossing collision, and that State Farm does.
The dispute centers on a wreck involving a hi-rail truck, described as a road vehicle fitted with extra wheels so it can run on railroad tracks. The complaint says an employee of Southern Design and Materials, Inc. was driving one on or about Aug. 7, 2023, traveling behind another hi-rail truck, when the lead driver stopped on a railroad crossing, the following driver could not stop in time, and the two collided, injuring the lead driver who later sued in state court in Walker County, Alabama.
Indian Harbor said it issued Southern Design and Materials a commercial general liability policy with a $1 million each-occurrence limit and a $2 million general aggregate limit, while State Farm issued an auto policy with $1 million in limits on the truck itself, listed as "YOUR CAR." Indian Harbor points to an auto exclusion in its policy, arguing the hi-rail truck qualifies as an "auto" because it was built for public roads and carried Alabama-mandated liability insurance.
State Farm’s position, as stated in the filing, is that the loss arose from equipment mounted on the truck, specifically the rail wheels, and that State Farm’s commercial vehicle endorsement provides "NO COVERAGE" for damages arising out of the operation, maintenance, or use of equipment towed by, mounted on, or carried on any vehicle. Indian Harbor argues the accident did not arise from separate equipment, but from the truck itself, according to the complaint.