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 .