Articles Posted in INSURANCE – UNINSURED MOTORIST

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Posted by H. Lee Pruett

The Georgia Supreme Court recently clarified that it is the insured/plaintiff, not the UM carrier, who has the burden of proof as to whether the at-fault driver was in fact an uninsured motorist under the plaintiff’s UM policy. In Travelers Home & Marine Ins. Co. v. Castellanos, Case No. S14G1878, 2015 Ga. LEXIS 350 (Ga. S. Ct., June 1, 2015), the defendant did not appear at trial in the underlying case. After the plaintiff obtained a judgment, the defendant’s liability carrier, United Auto, denied coverage to the defendant based on a failure to cooperate in the defense. The plaintiff then sought payment from Travelers, his UM carrier, and eventually filed suit against Travelers for bad faith refusal to pay a covered loss. Travelers raised the defense that United Auto did not “legally deny” the underlying defendant’s liability coverage and, therefore, the defendant was not an “uninsured motorist” under the policy.
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Posted by H. Lee Pruett

In Wade v. Allstate Fire & Cas. Co., Case No. A13A0827 (Ga. Ct. App., Nov. 6, 2013) the plaintiff was injured in a multi-vehicle accident and sued the three other drivers involved (as well as one driver’s employer under respondeat superior, and another driver’s mother under the family purpose doctrine). He also served Allstate as his uninsured motorist insurance carrier. The plaintiff reached a partial settlement with two of the defendants for their liability policy limit, and signed a limited release so that he could pursue any other insurance coverage. The plaintiff then settled with the other defendants for an amount less than the total of their liability policy limits, signed a general release, and dismissed these defendants with prejudice. Arguing that the plaintiff was not entitled to uninsured motorist coverage because he had not exhausted the liability limits available to all of the defendants, Allstate moved for summary judgment. The trial court granted the motion, but the Court of Appeals reversed.
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Posted by H. Lee Pruett

A recent telephone call from an acquaintance who happens to be a plaintiffs’ lawyer prompted a little research on my part to determine an insurance company’s obligations to provide uninsured motorist coverage, and how to know whether the coverage is “traditional” or “add-on.” With traditional UM, the insurance company is entitled to a setoff for any underlying liability coverage. For example, if the defendant driver has $25,000 in liability limits, and the plaintiff has $25,000 in UM coverage, the UM carrier has no exposure (assuming the liability carrier made no direct payments to satisfy any federal benefits liens). With add-on UM, the insurer would provide the full $25,000 in coverage after the defendant carrier’s payment of the liability limit. How do you know whether the plaintiff has traditional or add-on UM coverage?
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Posted by H. Lee Pruett

In State Farm v. Adams, Case No. S09G1710 (Ga. S. Ct., Nov. 30, 2010), the Georgia Supreme Court reversed the Court of Appeals’ decision in Adams v. State Farm, 298 Ga. App. 249 (2009), in which the Court of Appeals held that a liability insurance carrier’s payment of the plaintiff’s hospital lien reduced the amount of liability coverage available, so the plaintiff’s uninsured motorist coverage carrier was not entitled to set off the amount of the lien. (See Levy & Pruett’s April 27, 2009 blog post.) Looking to the language and purposes of the uninsured motorist statute and the hospital lien statute, the Georgia Supreme Court held that payment of the hospital lien does not increase the amount of uninsured motorist coverage, that the UM carrier is entitled to the setoff.
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Posted by Wm. Daniel Floyd
INSURANCE COVERAGE/UM STACKING: In cases of conflict between pre-printed and written portions of insurance policy, written portions will prevail. State Farm v. Staton, 286 Ga. 23, 685 S.E.2d 263 (2009)

Cecil Staton was involved in a serious automobile accident suffering serious injuries. The vehicle he was traveling in was owned by his employer, Smyth & Helwys, and insured by State Farm at the time of loss. The State Farm policy identified the “named insured” as the “first person named” on the declarations page. Smyth & Helwys was the first and only name listed on that page. Smyth & Helwys owned two other vehicles which were insured separately by State Farm, but which were not involved in the collision. These additional vehicle policies issued by State Farm also identified Smyth & Helwys as the sole named insured on the respective declarations pages.
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Posted by Jonathan A. Barash

In Ramos-Silva v. State Farm Inc. Co., 2009 Ga. App. LEXIS 1250 (2009), the Georgia Court of Appeals held that a Uninsured Motorist (“UM”) insurer’s right of subrogation survives the execution of a limited liability release.
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Posted by Jonathan A. Barash

In a recent study, the Insurance Research Council (“IRC”) predicted that the recent economic downtown will trigger a sharp rise in the number of uninsured motorists nationwide. In its Uninsured Motorist, 2008 Edition report, IRC predicted a rise from an estimated 13.8% uninsured drivers in 2007 to 16.1% in 2010.
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Posted by H. Lee Pruett

On reconsideration, the Georgia Court of Appeals reversed itself in Adams v. State Farm, Case. No. A08A2315 (Ga. Ct. App., April 14, 2009), and ruled that an automobile liability carrier’s payment to satisfy a hospital lien reduces the amount of available coverage so as to increase the amount of uninsured motorist coverage. In its initial decision of February 17, 2009, the Court held that such a payment did not reduce the amount of available liability coverage. (See Levy & Pruett Blog Post dated March 2, 2009.) That initial decision, however, became the minority position of the dissent following the Court’s reconsideration of the case.
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Posted by H. Lee Pruett

The Georgia Supreme Court ruled that a limited release for pursuit of uninsured motorist (“UM”) coverage is ambiguous when the plaintiffs — husband and wife — settle bodily injury claims and a loss of consortium claim for single person liability limits.
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Posted by H. Lee Pruett

The Georgia Court of Appeals recently issued an important decision concerning automobile liability and uninsured motorist coverage. In Adams v. State Farm, Case. No. A08A2315 (Ga. Ct. App., Feb. 17 2009), the plaintiff was seriously injured in a car accident with the defendant who had $25,000 in liability coverage. Nationwide, the defendant’s insurer, paid a portion of the limits to Grady Hospital to satisfy a hospital lien. The balance was paid directly to the plaintiff in exchange for a limited release. The plaintiff then sought uninsured motorist (“UM”) coverage from his insurer, State Farm, which provided $100,000 in uninsured motorist coverage. State Farm sought to apply the full amount of the underlying liability coverage as a setoff. The plaintiff argued that State Farm should not be allowed to set off the portion paid to the hospital because payment of the lien reduced the amount of “available” liability coverage.
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