ILNews

Justices rule on underinsured motorist coverage case

Back to TopCommentsE-mailPrintBookmark and Share

The Indiana Supreme Court has held that a tortfeasor’s vehicle was underinsured according to state statute because the benefit amount actually paid to a woman was less than the per-person limit of liability of the underinsurance endorsement of an insurance policy that applied to all the family members involved in the accident.

In Hannah Lakes v. Grange Mutual Casualty Company, No. 89S05-1109-CT-531, the justices unanimously agreed with the result the Indiana Court of Appeals reached, but for a different reason.

The case involves a severe auto accident in 2004 where Hannah Lakes and several family members were injured. The tortfeasor, James Isaacs, had an insurance policy that limited bodily injury liability to $25,000 per person and $50,000 per accident. Lakes’ sister, Anitra, was driving and had an insurance policy with underinsured motorist coverage for $50,000 per person and per accident. Their father, Jerry Lakes, also had UIM coverage for $100,000 per person and $300,000 per accident.

After the Lakeses filed a state suit against Isaacs and Anitra Lakes’ carrier, Grange Mutual Casualty Company, Isaacs’ carrier paid its limit but Grange filed for summary judgment on the basis that the tortfeasor’s 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 of Anitra’s policy. The trial court granted Grange’s summary judgment motion, holding that Jerry Lakes’ $50,000 policy limit was equal to the UIM limit Anita Lakes had in her policy and that it didn’t matter that more than one family member was receiving benefits. The trial court also held Hannah Lakes couldn’t recover under her father’s insurance because that policy excluded coverage for property damage or bodily injury for family members inside the vehicle.

The Court of Appeals reversed, holding that the tortfeasor’s vehicle was underinsured and that Hannah was entitled to recover up to $44,900 in UIM benefits under Anitra’s policy. The justices agreed, although for a different reason. They reaffirmed the decision from a decade ago in Corr v. American Family Insurance, 767 N.E.2d 535 (Ind. 2002).

The Supreme Court agreed with Grange and the trial court that the regime established by the intermediate appellate court may encourage “collusion” among insureds to structure their relationships in order to trigger Corr. But the justices disagreed with the proposed “fix” to that issue, adopting a different standard from another line of precedent.

Justice Frank Sullivan wrote for the court that when there are multiple claimants on these types of cases, courts should examine each claim individually and compare each with the per-person limits of applicable UIM coverage. The per-accident limits have no bearing on whether a vehicle is underinsured, Sullivan wrote, and the per-accident limits come into play only to limit the insurer’s liability.

The trial court judgment is reversed and the case is remanded for further proceedings consistent with this opinion.

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in Indiana Lawyer editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by

facebook - twitter on Facebook & Twitter

Indiana State Bar Association

Indianapolis Bar Association

Evansville Bar Association

Allen County Bar Association

Indiana Lawyer on Facebook

facebook
ADVERTISEMENT
Subscribe to Indiana Lawyer
  1. I just wanted to point out that Congressman Jim Sensenbrenner, Senator Feinstein, former Senate majority leader Bill Frist, and former attorney general John Ashcroft are responsible for this rubbish. We need to keep a eye on these corrupt, arrogant, and incompetent fools.

  2. Well I guess our politicians have decided to give these idiot federal prosecutors unlimited power. Now if I guy bounces a fifty-dollar check, the U.S. attorney can intentionally wait for twenty-five years or so and have the check swabbed for DNA and file charges. These power hungry federal prosecutors now have unlimited power to mess with people. we can thank Wisconsin's Jim Sensenbrenner and Diane Feinstein, John Achcroft and Bill Frist for this one. Way to go, idiots.

  3. I wonder if the USSR had electronic voting machines that changed the ballot after it was cast? Oh well, at least we have a free media serving as vicious watchdog and exposing all of the rot in the system! (Insert rimshot)

  4. Jose, you are assuming those in power do not wish to be totalitarian. My experience has convinced me otherwise. Constitutionalists are nearly as rare as hens teeth among the powerbrokers "managing" us for The Glorious State. Oh, and your point is dead on, el correcta mundo. Keep the Founders’ (1791 & 1851) vision alive, my friend, even if most all others, and especially the ruling junta, chase only power and money (i.e. mammon)

  5. Hypocrisy in high places, absolute immunity handed out like Halloween treats (it is the stuff of which tyranny is made) and the belief that government agents are above the constitutions and cannot be held responsible for mere citizen is killing, perhaps has killed, The Republic. And yet those same power drunk statists just reel on down the hallway toward bureaucratic fascism.

ADVERTISEMENT