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Insurance—Rejection of UIM Coverage Need Not Be In Writing

Blevens v Government Employees Ins. Co., 613 Ariz. Adv. Rep. 20 (App. Div. I, July 28, 2011) (J. Portley)

UIM STATUTE DOES NOT REQUIRE WRITTEN AND SIGNED REJECTION OF COVERAGE FOR REJECTION TO BE VALID

Plaintiff purchased auto liability insurance from GEICO. The policy indicated that while he choose to purchase liability coverage, he rejected the offer of underinsured motorist [UIM] coverage. Plaintiff had an accident with an underinsured motorist and sued GEICO when it refused to pay UIM coverage. The trial court granted the plaintiff summary judgment on the contract question finding that GEICO was required to obtain a signed written rejection of the UIM in order to claim the coverage was rejected.

The Arizona Court of Appeals reversed finding that nowhere in the express or implied language of ARS sec. 20-259.01(B) or its more recent amendments, does it state that the rejection of the UIM offer must be in writing and signed. The statute does require a written offer be extended to the insured and the Arizona Department of Insurance provides a form for this purpose. Interestingly, the form has a place for the insured to sign and to elect whether he or she wants to accept or reject the coverage. However the carrier is not required to use the form and the statute does not require the written offer be responded to in writing or signed. Where here it was uncontroverted that the plaintiff did not sign the written offer electing to purchase coverage, nor to reject it the carrier, was entitled to take the position the coverage was rejected.

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