UM/UIM Statute Makes a Motorcycle Into an Automobile
Barry Zalma
Apr 12, 2023
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Progressive Classic Insurance Company contested the trial court’s entry of summary judgment in favor of plaintiff. The sole question to the Court of Appeals was whether the insurer was required by statute to provide coverage for “newly acquired vehicles,” such as plaintiffs motorcycle, notwithstanding an insurance policy term that excluded transportation devices with less than four wheels. The trial court granted plaintiffs motion and denied defendant’s motion.
In Steven Cantu v. Progressive Classic Insurance Company, 325 Or.App. 184, A175784, Court of Appeals of Oregon (April 5, 2023) the Court interpreted Oregon’s UM/UIM statute.
FACTS
Plaintiff was insured by defendant for three automobiles. The policy at issue did not list any motorcycles on the declaration page. About eight days after purchasing a motorcycle, plaintiff was severely injured when another driver negligently made a left turn in front of plaintiff.
As a result of the injuries, plaintiff sought damages in excess of the liability limits of the other driver. Defendant denied underinsured motorist bodily injury benefits based on specific terms of the insurance policy that excluded vehicles with less than four wheels.
The trial court granted summary judgment to plaintiff, after concluding that the relevant definitions in the insurance policy impermissibly provided underinsured motorist benefits that are less favorable to the insured than the terms of ORS 742.504 required.
A motorcycle, under a common understanding of the term, is a “device” “upon or by which any person” “may be transported *** upon a public highway” and is not “moved by human power” or “used exclusively upon stationary rails or tracks.” A motorcycle is therefore a vehicle within the definition provided by the legislature.
Defendant contended that the trial court erred by construing the statute as requiring the newly acquired vehicle provision to include the motorcycle when the policy itself did not cover any motorcycles.
There is no evidence that suggests that the legislature intended a different meaning for the word “vehicle” when defining “insured vehicle” than it did when defining “hit-and-run vehicle,” “phantom vehicle,” “stolen vehicle,” or “uninsured vehicle.”
The Court of Appeals concluded that it was apparent that the legislature intended the term “vehicle” to carry the definition the legislature provided in paragraph (m) and that the trial court did not err by concluding that the paragraph (m) definition of vehicle was the applicable definition of that word and it included motorcycles.
The court inferred that the motorcycle did not have “at least four wheels,” and was therefore excluded as a “covered auto” under the terms of the policy. A UM policy provides “less favorable” terms to an insured not by a direct comparison between the challenged provision with an individual statutory provision, rather, the coverages provided in the policy against those required by statute.
Thus, the court concluded that, by limiting the definition of “auto” in the policy to devices having “at least four wheels,” defendant impermissibly provided less favorable coverage to plaintiff than that required by law. The trial court did not err by concluding, or by granting summary judgment to plaintiff on that basis.
ZALMA OPINION
Legislatures have an amazing ability to deprive an insurer and insured of the ability to agree to the terms and conditions of the policy contract. Here, the plaintiff and his insurer agreed that it would not insure motorcycles. The plaintiff knew this when he bought his motorcycle. He got the court to provide coverage different than that agreed to in the policy by interpreting the UM/UIM statute to make a motorcycle an auto by the definitions in the statute because Progressive provided a policy wording – approved by the Department of Insurance – that provided coverage for the operation of the motorcycle. Of course, if the accident was plaintiff’s fault he would have had no liability coverage.
(c) 2023 Barry Zalma & ClaimSchool, Inc.
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Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 54 years in the insurance business. He is available at http://www.zalma.com and [email protected]
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Barry Zalma, Esq., CFE is available at http://www.zalma.com and [email protected]
Chutzpah: After Criminal Prosecution Defendant Sues USA
Post 5164
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Dr. Segun Patrick Adeoye, a medical doctor, filed a lawsuit against the United States of America, seeking damages for alleged violations during his criminal prosecution. He was acquitted by a jury but claims to have suffered significant harm, including financial losses, damage to his professional reputation, and personal distress.
In Dr. Segun Patrick Adeoye v. The United States Of America, Civil Action No. 4:25-cv-83, United States District Court, E.D. Texas, Sherman Division (July 23, 2025) the USDC dismissed Adeoye’s suit.
FACTUAL BACKGROUND
Dr. Adeoye was indicted on charges of conspiracy to commit wire fraud and money laundering. The indictment alleged that he and his co-conspirators obtained at least seventeen million dollars through various fraudulent schemes. Despite being acquitted, Dr. Adeoye claims that his ...
Payment of Appraisal Award Defeats Claim of Bad Faith
Post 5163
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Hurricane Damage to Dwelling Established by Appraisal Award
In Homeowners Of America Insurance Company v. Emilio Menchaca, No. 01-23-00633-CV, Court of Appeals of Texas, First District (July 31, 2025) after a hurricane Homeowners of America Insurance Company (“HAIC”) estimated that the cost of covered repair to Menchaca’s house was $3,688.54, which was less than his deductible, and therefore no payment would be made.
FACTS
After Menchaca retained counsel HAIC advised that, under the terms of the policy, Menchaca was required to first invoke the appraisal process prior to filing suit, and that HAIC reserved the right to request that Menchaca and any adjuster hired on his behalf submit to an Examination Under Oath (“EUO”).
On August 23, 2018, Menchaca’s counsel ...
Payment of Appraisal Award Defeats Claim of Bad Faith
Post 5163
Read the full article at https://lnkd.in/dNpKKcYx, see the full video at https://lnkd.in/dNgwRP8q and at https://lnkd.in/dA9dvd-D, and at https://zalma.com/blog plus more than 5150 posts.
Hurricane Damage to Dwelling Established by Appraisal Award
In Homeowners Of America Insurance Company v. Emilio Menchaca, No. 01-23-00633-CV, Court of Appeals of Texas, First District (July 31, 2025) after a hurricane Homeowners of America Insurance Company (“HAIC”) estimated that the cost of covered repair to Menchaca’s house was $3,688.54, which was less than his deductible, and therefore no payment would be made.
FACTS
After Menchaca retained counsel HAIC advised that, under the terms of the policy, Menchaca was required to first invoke the appraisal process prior to filing suit, and that HAIC reserved the right to request that Menchaca and any adjuster hired on his behalf submit to an Examination Under Oath (“EUO”).
On August 23, 2018, Menchaca’s counsel ...
Rulings on Motions Reduced the Issues to be Presented at Trial
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CASE OVERVIEW
In Richard Bernier v. State Farm Mutual Automobile Insurance Company, No. 4:24-cv-00002-GMS, USDC, D. Alaska (May 28, 2025) Richard Bernier made claim under the underinsured motorist (UIM) coverage provided in his State Farm policy, was not satisfied with State Farm's offer and sued. Both parties tried to win by filing motions for summary judgment.
FACTS
Bernier was involved in an auto accident on November 18, 2020, and sought the maximum available UIM coverage under his policy, which was $50,000. State Farm initially offered him $31,342.36, which did not include prejudgment interest or attorney fees.
Prior to trial Bernier had three remaining claims against State Farm:
1. negligent and reckless claims handling;
2. violation of covenant of good faith and fair dealing; and
3. award of punitive damages.
Both Bernier and State Farm dispositive motions before ...
ZIFL Volume 29, Issue 10
The Source for the Insurance Fraud Professional
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Zalma’s Insurance Fraud Letter (ZIFL) continues its 29th year of publication dedicated to those involved in reducing the effect of insurance fraud. ZIFL is published 24 times a year by ClaimSchool and is written by Barry Zalma. It is provided FREE to anyone who visits the site at http://zalma.com/zalmas-insurance-fraud-letter-2/ You can read the full issue of the May 15, 2025 issue at http://zalma.com/blog/wp-content/uploads/2025/05/ZIFL-05-15-2025.pdf
This issue contains the following articles about insurance fraud:
Health Care Fraud Trial Results in Murder for Hire of Witness
To Avoid Conviction for Insurance Fraud Defendants Murder Witness
In United States of America v. Louis Age, Jr.; Stanton Guillory; Louis Age, III; Ronald Wilson, Jr., No. 22-30656, United States Court of Appeals, Fifth Circuit (April 25, 2025) the Fifth Circuit dealt with the ...
Professional Health Care Services Exclusion Effective
Post 5073
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This opinion is the recommendation of a Magistrate Judge to the District Court Judge and involves Travelers Casualty Insurance Company and its duty to defend the New Mexico Bone and Joint Institute (NMBJI) and its physicians in a medical negligence lawsuit brought by Tervon Dorsey.
In Travelers Casualty Insurance Company Of America v. New Mexico Bone And Joint Institute, P.C.; American Foundation Of Lower Extremity Surgery And Research, Inc., a New Mexico Corporation; Riley Rampton, DPM; Loren K. Spencer, DPM; Tervon Dorsey, individually; Kimberly Dorsey, individually; and Kate Ferlic as Guardian Ad Litem for K.D. and J.D., minors, No. 2:24-cv-0027 MV/DLM, United States District Court, D. New Mexico (May 8, 2025) the Magistrate Judge Recommended:
Insurance Coverage Dispute:
Travelers issued a Commercial General Liability ...
