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Insurance—Portability & Scope of Statutorily Required UIM Coverage—Commercial Vehicle

Posted by Ted A. Schmidt | Sep 25, 2015 | 0 Comments

Bambrell v. IDS Property &  Cas. Ins. Co., 721 Ariz. Adv. Rep. 24 (App. Div. II, September 9, 2015) (J. Miller)

UIM COVERAGE IN PERSONAL AUTO POLICY IS NOT PORTABLE AS TO INJURY IN COMMERCIAL VEHICLE

In 2011, Frank Gambrell was driving a semi-tractor tanker, transporting milk for his employer, when another driver lost control of his vehicle and crashed into the tanker. For Frank's serious injuries, he received $15,000 from the other driver's insurance policy and $100,000 in UIM coverage from his employer's policy. He then sought an additional $100,000 from the UIM coverage of his personal automobile liability insurance policy. This claim was denied and Gambrell sued the defendants for breach of contract and insurance bad faith. The trial court granted defendants summary judgment and the Arizona Court of Appeals affirmed.

Generally speaking underinsured motorist coverage is portable and applies whenever and wherever the insured is injured by an underinsured motorist. However, subsection C of the statute creates an exception:

Any insurer writing automobile liability or motor vehicle liability policies may make available the coverages required by subsections A and B of this section to owners and operators of motor vehicles that are used as public or livery conveyances or rented to others or that are used in the business primarily to transport property or equipment. A.R.S. §20-259.01(C).

The court of appeals, consistent with precedent, held that this statute creates a permissive option to insurers. Where insurers choose not to offer UIM coverage arising out of the operation of a commercial vehicle subsection C supports a finding that such coverage is not portable to an injury sustained in a commercial vehicle .

About the Author

Ted A. Schmidt

Ted's early career as a trial attorney began on the other side of the fence, in the offices of a major insurance defense firm. It was there that Ted acquired the experience, the skills and the special insight into defense strategy that have served him so well in the field of personal injury law. Notable among his successful verdicts was the landmark Sparks vs. Republic National Life Insurance Company case, a $4.5 million award to Ted's client. To this day, it is the defining case for insurance bad faith, and yet it is only one of several other multi-million dollar jury judgments won by Ted during his career. He is certified by the State Bar of Arizona as a specialist in "wrongful death and bodily injury litigation".

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