Insurance: UIM Coverage for Wrongful Death Benefits for Loss of Son Under Grandmother's Policy State Farm Mut. Auto. Ins. Co. v. White, 651 Ariz. Adv. Rep. 8 (App. Div. I, January 3, 2013) (J. Johnsen) ARS SEC. 20-259.03 DOES NOT LIMIT WRONGFUL DEATH DAMAGES UNDER UIM POLICY TO NAMED INSUREDS
Plaintiff's teenage son was killed in a head on collision while riding as a passenger in his maternal grandmother's car. Plaintiff was the decedent's mother and daughter to the policyholder . The adverse driver was underinsured. Grandma had an auto policy with State Farm that included $250,000 per person/$500,000 per accident. Plaintiff sued State Farm for wrongful death damages under the policy. State Farm was granted summary judgment claiming that while the policy would otherwise cover this claim, it was barred by Ariz. Rev. Stat. sec. 20-259.03. The Arizona Court of Appeals reversed and remanded.
The statute in question provides that wrongful death damages may be had under UIM and UM coverage provided the person seeking the damages has a statutory right to wrongful death damages under Ariz. Rev. Stat. sec. 12-612 and provided the claimant is "also a surviving insured under the same coverages of the policy." Here, while the plaintiff was not a "named insured the policy stated that "any relative" of the named insured was also an insured. The court of appeals held: "More broadly, we reject State Farm's argument that by enacting §20-259.03, the legislature intended to forbid an insurer from choosing to provide UIM benefits to claimants other than a named insured and resident family members. It is one thing to require an insurer to provide certain coverage. The legislature did just that when it enacted the Uninsured Motorist Act, which requires insurers to 'make available' to policyholders uninsured motorist and UIM coverage 'which extends to and covers all persons insured under the policy.' It is quite another thing to suppose that in imposing such a requirement, the legislature intended to restrict the freedom of an insurer to choose to define broadly who is an 'insured' eligible to receive such benefits."
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