410_C236
UM
STATUS BASED ON AVAILABLE COVERAGE, NOT SPECIFIED LIMITS
|
Personal
Automobile |
|
Uninsured
Motorist |
In September
2004, James Isaacs failed to observe a stop sign at an intersection and crashed
into a car driven by Anitra Lakes. Isaacs had one
passenger in his car, Dustin Gavin. Lakes’ mother, LuAnn, and her 12-year-old
sister, Hannah, were passengers in Anitra’s car.
Everyone involved in the accident was injured.
At the time
of the accident, Isaacs was insured by Viking Insurance under a personal
automobile policy with limits of $25,000 per person and $50,000 per accident. Anitra Lakes’ policy, issued by Grange Mutual Casualty
Company, included underinsured motorist coverage with limits of $50,000 per
person and $50,000 per accident. LuAnn’s husband, Jerry Lakes, also had a
Grange Mutual policy that included underinsured motorists coverage with limits
of $100,000 per person and $300,000 per accident.
In January
2005, the Lakes sued Isaacs and Grange Mutual for underinsured motorists coverage. Viking paid the $50,000 per accident
limit. This was divided among Hannah, Anitra, LuAnn,
Jerry, and Dustin Gavin, with Hannah receiving $5,100. After Viking paid its
policy limits, Isaacs was dismissed from the case with prejudice upon a joint
stipulation by the parties.
In February
2010, Grange Mutual filed a motion for summary judgment and designation of
evidence, claiming that Isaacs’ vehicle was not an underinsured vehicle as a
matter of law because the per-accident limit of his policy was equal to the UIM
per-accident limit in Anitra’s policy. Grange also
argued that Jerry’s policy excluded underinsured motorist coverage under these
facts.
On May 5,
2010, prior to responding to Grange’s motion, Anitra,
LuAnn, and Jerry voluntarily moved to dismiss their claims with prejudice,
leaving Hannah as the only party claiming underinsured motorist coverage under Anitra’s policy. The next day the trial court granted the
motion and dismissed all plaintiffs except Hannah. On the same day, Hannah
filed her objection to summary judgment, her brief in opposition, and her
designation of evidence.
The trial
court granted Grange Mutual’s motion for summary
judgment. Hannah appealed.
On appeal,
Hannah abandoned her claim under Jerry’s policy and sought UIM benefits under
only Anitra’s policy.
The court of
appeals reversed the lower court’s decision. It found that Isaacs’ vehicle was
underinsured and that Hannah was entitled to recover up to $44,900 under Anitra’s policy. However, this decision was vacated when
the Supreme Court of Indiana agreed to hear the case.
The central
issue to be decided by the high court was whether Isaacs’ vehicle was an
underinsured motor vehicle within the meaning of the Indiana underinsured
motorists statute. The statute states that “the term underinsured motor vehicle
includes an insured motor vehicle where the limits of coverage available for
payment to the insured under all bodily injury liability policies covering
persons liable to the insured are less than the limits for the insured’s
underinsured motorists coverage at the time of the accident, but does not
include an uninsured motor vehicle.”
Applying this
language, Grange Mutual claimed that because the per-accident limits of Isaacs’
policy and the per-accident underinsured motorists benefits under Anitra’s policy were identical, Hannah received from Grange
the same amount she would have received under Anitra’s
policy had Anitra’s UIM benefits provided the only
source of recovery.
Grange also
argued that the Lakes family could not unilaterally trigger underinsured
motorist coverage by dismissing all claims except Hannah’s because such action
encourages insureds to “structure their
relationships” to maximize the available insurance coverage.
The court
disagreed. It concluded that whether a driver’s vehicle was underinsured
depended on a comparison of what the insured actually received from the other
driver’s insurer and what the per-person, not per-accident, limit was under the
insured’s policy. Therefore, Isaacs’ vehicle was “underinsured” within the meaning
of the statute. Whether Hannah Lakes would receive benefits under the Grange
policy would depend on the damages she could prove in a trial court setting.
The decision
of the trial court was reversed and the case remanded for further proceedings.
Lakes
vs. Grange Mutual Casualty Company-No. 89S05-1109-CT-531-Supreme Court of
Indiana-March 20, 2012-2012 WL 928137 (Ind.)