In the case of Gillespie v. National Farmers Union Property & Casualty Co., plaintiff was the policyholder of a UIM policy that, when triggered, would cover not just her but her teenage daughter, who had just earned her temporary driver’s license. But the question before the North Dakota Supreme Court was whether those benefits were indeed triggered.

UIM policies only kick in when:

• You are an insured under the policy;
• Liability of the other party is established;
• The policy limits of the other policy are exhausted;
• Those policy limits are inadequate to compensate for crash-related damages.

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In the Gillespie case, the question was whether benefits had been triggered, and specifically, whether liability against the at-fault party had been established.

According to court records, plaintiff’s teen daughter – just two days after receiving her temporary driver’s permit – was given permission to driver her aunt’s vehicle. With the girl, the aunt and a third woman inside, the girl lost control of the vehicle and it overturned. The aunt died. The other passenger and the driver were seriously injured.

The aunt had $25,000 in no-fault car accident insurance from GEICO. That amount was paid to plaintiff’s daughter. However, with significant injuries, this was not enough to cover her damages. She sought bodily injury liability coverage from GEICO on the grounds the aunt/policyholder had negligently entrusted her with the vehicle. She was an inexperienced driver who had only just obtained her learner’s permit and she should have have been given permission to drive this vehicle.

GEICO, however, denied the request for liability coverage.

That’s when plaintiff turned to her own UIM benefits, which were for $100,000 per person and up to $300,000 per crash. Plaintiff alleged her daughter’s unpaid medical bills and her injuries and ongoing medical expenses far exceeded the $25,000 she had already been paid. However, the UIM carrier, Farmer’s Union, denied the claim, asserting plaintiff hadn’t yet exhausted all available insurance.

District court granted summary judgment in favor of the insurer, finding the limits of all applicable bodily injury policies had not been exhausted and state law asserts UIM coverage doesn’t apply until the limits of all applicable liability policies have been exhausted.

Plaintiff appealed. They argued the aunt’s vehicle was an underinsured motor vehicle, the severity of the girl’s injuries exhausted the liability coverage and triggered the UIM coverage and that Farmers Union should have to pay because GEICO unequivocally said it wouldn’t be making any further payments and there were no further options for recovery.

State supreme court affirmed. The court noted that while negligent entrustment is indeed grounds for compensation when it results in injury. The problem here was that claimant had not filed any sort of tort action against either her aunt’s heirs or GEICO or made any other claim for negligent entrustment that would have established liability after GEICO’s denial. That means plaintiffs did not exhaust payment of all possible avenues of recovery.

Call Fort Lauderdale Injury Attorney Richard Ansara at (954) 761-4011. Serving Broward, Miami-Dade and Palm Beach counties.

Additional Resources:

Gillespie v. National Farmers Union Property & Casualty Co., Oct. 5, 2016, North Dakota Supreme Court

More Blog Entries:

Holt v. DOT – Court Upholds $3M Verdict Against State, Oct. 6, 2016, Fort Lauderdale Car Accident Lawyer Blog

This is totally legal and will be enforced by the courts – so long as the language contained therein is clear and unambiguous. However, if there is any ambiguity in these anti-stacking provisions, the courts will generally decline to apply them. This is important because it can mean doubling or sometimes even tripling the amount to which you are entitled.

Let’s look at one example of this, recently weighed by the Idaho Supreme Court. In Gearhart v. Mutual of Enumclaw Ins. Co., which involved two separate underinsured motorist policies that covered the same young man. The policies written by the same insurance company, but they were separate, one belonging to his mother and another to his father. The couple had previously divorced.

Defendant insurer insisted that anti-stacking language in each of the policies meant plaintiffs could not stack the policies, which were each worth $300,000. That meant the difference between $300,000 in benefits for the seriously injured young man and $600,000 in benefits (minus the $100,000 that had already been paid).

According to court records, plaintiff was in the passenger seat of a vehicle driven by a female teen friend. She was operating her brother’s vehicle. The girl was reportedly negligent and caused a crash. Plaintiff was seriously and permanently injured, suffering a severe brain injury. This resulted in permanent cognitive defects. For purposes of the action before the high court, it was not disputed that plaintiff’s damages as a result of the crash well exceed $600,000.

The insurance policy that covered the negligent driver and her brother (as owner of the vehicle) was exhausted. However, it was nowhere near enough to cover plaintiff’s damages. For this reason, both his parents separately pursued UIM benefits on behalf of their son, to help assist with the cost of his medical care.

Any time an insurer seeks to limit the coverage of the plan (which is well within the firm’s right), the burden is on the insurer to make sure the language used in such provisions is clear and precise. But in this case, the court had this advice to insurers: “Good luck to the average insurance buyer in deciphering the meaning of this provision.”

Specifically, the court was referring to a provision that states that when there is any other policy that applies to the same accident, the maximum limit of liability under all the policies will be the highest applicable limit under any one policy. “Huh?” the court collectively asked. Does this mean we add up all the policy limits and then whatever that sum is, that’s the highest amount payable under any single policy? The court posited that while it would question the advisability of this, but that’s what the language seems to indicate. More likely, the insurer meant that whatever the highest policy limit of those other policies, that’s the most that would be paid. But in this case, this ambiguity, which involves language that is the opposite of clear and precise, is not adequate to restrict coverage. The policy here may be stacked.

If you have a question about stacked coverage following your Fort Lauderdale car accident, we can help.

Call Fort Lauderdale Injury Attorney Richard Ansara at (954) 761-4011. Serving Broward, Miami-Dade and Palm Beach counties.

Additional Resources:

Gearhart v. Mutual of Enumclaw Ins. Co., June 27, 2016, Idaho Supreme Court

More Blog Entries:

State Farm Mut. Auto. Ins. Co. v. Jakubowicz – UIM Policy Ambiguous, Court Rules, Aug. 7, 2016, Fort Lauderdale Car Accident Attorney Blog

These limits are important not just for that policy, but also for other secondary policies that may be applicable. Some insurance – like uninsured/ underinsured motorist coverage – will only kick in once the limits of the primary policy have been exhausted.

In the recent case of Trotter v. Harleysville Ins. Co., the question before the U.S. Court of Appeal for the Seventh Circuit was whether the trial court correctly decided that the $500,000 limit on an auto insurance policy was per accident, and not per-person. It was a difference that could have meant hundreds of thousands of more dollars for plaintiffs. However, the appeals court ultimately decided the trial court was right, denying plaintiffs additional coverage.more

According to court records in the case, a woman drove through a stop sign on afternoon in July 2011. This caused a four-vehicle crash. Plaintiffs in this case were the occupants of one of those vehicles – a driver and two passengers.

At-fault driver was insured under a personal auto insurance policy that had liability limits of $250,000 per person and $500,000 per accident.

The at-fault driver’s insurer ultimately settled for the per-accident limit of $500,000. Of that, the driver received half and the remaining half was split between the two passengers.

Plaintiffs asserted this was not enough to make them whole. Therefore, each submitted claims to defendant insurer, Harleysville, with which the victim driver had an underinsured motorist policy. That policy entitled victims coverage of up to $500,000 per-accident. Underinsured motorist policy coverage provides an additional layer of protection when the at-fault driver’s insurance comes up short.

However in this case, the at-fault driver’s insurance company had paid $500,000 – which was the same limit as the UIM coverage.

Plaintiffs argued the UIM policy did not unambiguously say the $500,000 limit was per-accident, but instead could be construed to mean up to $500,000 per person. That would open the potential liability limit to $1.5 million per accident – $500,000 for each person injured (minus what they had already recovered).

When the insurer refused this demand, each filed a separate injury lawsuit against the insurer seeking to collect the remainder of their damages. The cases were consolidated and the district court decided the policy was not ambiguous and the $500,000 coverage limit is per accident – which means the plaintiffs were entitled to nothing further.

Plaintiffs appealed.

The Seventh Circuit looked closely at the language in the policy. The terms stated that the per-accident and per-person limit meant that it would pay a certain number (up to $250,000) per person and that no matter how many people were involved, it would pay no more than $500,000.

The appellate panel decided that while there might be some room to argue ambiguity in the language with regard to the per-person limits, the language pertaining to the per-accident limit was clear, and that meant nothing changed for the plaintiffs.

Ambiguity in an auto insurance policy is something that might be plainly obvious to most. That’s why we always recommend victims of serious accidents consult with an experienced car accident attorney.

Call Fort Lauderdale Injury Attorney Richard Ansara at (954) 761-4011. Serving Broward, Miami-Dade and Palm Beach counties.

Additional Resources:

Trotter v. Harleysville Ins. Co., May 10, 2016, U.S. Court of Appeals for the Seventh Circuit

More Blog Entries:

Snapchat Named in Car Accident Injury Lawsuit, May 3, 2016, Fort Lauderdale Car Accident Lawyer Blog