Jan 13, 2013 | Car Accidents, Uncategorized
No one wants to get into a car accident in the first place, and matters are made even worse when the other driver doesn’t have adequate insurance coverage. The best scenario in that situation is that a driver has uninsured/underinsured motorist (UIM) coverage. Even then, a driver must worry that his insurance company, as his UIM carrier, will dispute liability. A recent South Carolina Court of Appeals opinion illustrates how complicated matters can become in what one might think should be a straightforward car accident case. It also reveals some of the interesting decisions that a state might make when trying to regulate who, when, and how folks are compensated following a car accident.
In that case, Lincoln General v. Progressive Northern, the practical issue was which gargantuan insurance company would end up paying for damage caused by the negligent driver in a car accident. One of these insurance companies, the trail court plaintiff, was the UIM carrier, who had already paid up (for the injuries caused by the negligent driver). The other was the insurance company who had granted a policy to the owner of the negligently driven car. The policy, however, had an “endorsement” specifically excepting coverage of an individual in the policy holder’s household whose driver’s license had been revoked by the SC DMV. That sets up the legal issue: whether an insurance carrier must provide coverage despite a “named driver endorsement” (i.e. a provision excepting a named driver).
The policy backdrop here is that South Carolina law will require liability insurance companies to pay innocently injured drivers except in very limited cases, whether the policy purports to exclude coverage or not. The idea is that insurance companies should bear the loss, rather than the not-at-fault driver, whenever possible.
This case, however, deals with a specific exception made by South Carolina in the Motor Vehicle Financial Responsibility Act (the MVFRA) for these “named driver endorsements.” Realizing that if insurance companies knew that anybody in a household would end up being covered in the event of an accident, insurance rates might become very expensive for drivers who had someone with a revoked license and bad driving record in their home, the SC legislature allows individuals to add to their policy a named driver endorsement, to specifically exclude the driver with a revoked license.
Despite the MVFRA clearly making this exception, the trial court read the MVFRA as generally requiring coverage up to state minimum policy limits in all cases. The Court of Appeals rejected this because of the MVFRA’s clear exception for drivers whose licenses had been revoked.
The takeaway here for anyone who isn’t a subrogation lawyer is that named driver endorsements for folks whose licenses have been revoked will be respected and that UIM litigation is sometimes quite complicated.
The complete opinion is included below the fold.
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Jun 14, 2012 | Car Accidents, Uncategorized
Yesterday, the South Carolina Supreme Court gave some good news to plaintiffs injured by uninsured and underinsured motorists in Nationwide Mutual v. Rhoden. It clarified the previously standing public policy that required uninsured and underinsured motorist (UIM) coverage to extend beyond the express terms of insurance policy contracts. The legal jargon for this policy is that UIM coverage is “personal and portable.” What that means is that UIM coverage extends over individuals whichever car they are driving, rather than simply applying over the insured person only in the insured vehicle.
Uninsured and underinsured motorist insurance coverage is offered by car insurance companies to individuals to protect against the unthinkable: being injured by the as many as 25% of drivers on the road who have no insurance. Instead of simply being stuck with a loss after an accident with uninsured individuals, individuals can (and definitely should) opt for UIM coverage.
However, when individuals actually get injured UIM insurance companies will try, as they always do and frankly must do to stay in business, challenge claims for those injuries. They have in the past had some success limiting coverage to only the insured and only when injury is sustained in the car covered by the insurance policy with the UIM clause.
Courts quickly denied insurance companies this strategy and ruled that UIM policies are “personal and portable” and that individuals will be covered by their UIM policy whether in their own insured car or not. The reasoning is first, that it is better policy to shift the loss from the injured individual to the insurance company, and second, that individuals who are often unsure of what insurance contracts provide should be able to expect coverage.
Nationwide Mutual v. Rhoden clarified the law in an interesting situation. The case involved three individuals: a mother, having UIM coverage; her co-resident daughter; and her non-co-resident daughter without UIM coverage. The mother was driving the second daughter’s car. UIM coverage did not extend to the second daughter both because she had the choice to purchase UIM coverage and did not and she did not live with her mother. The mother and first daughter, however, would have been covered by the express terms of the mother’s UIM policy if they had been in the mother’s car. The court ignored the express language and applied the “personal and portable” policy.
While no huge departure from previous law, this case clarifies that SC Code § 38-77-160 does not interfere with the rule that UIM coverage is “personal and portable.”
The serious injury attorneys of Reeves Aiken & Hightower LLP know how to deal with insurance companies and are ready to fight for you. We encourage you to visit our website at www.rjrlaw.com and compare our attorneys’ credentials to any other firm. You can then call us toll-free at 877-374-5999 for a private, confidential consultation to review your particular case.
In case you want to wade through the opinion yourself you can find a PDF of it at this link or read it as it is reproduced below the fold: (more…)
