Insured May Limit the Extent of UM Coverage Acquired
You Only Get What You Pay For
Post 5068
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Sonya Harness was employed as a home health nurse with Volunteer Staffing, Inc. On July 10, 2021, Ms. Harness was injured in a two-car collision while driving her vehicle in connection with her employment. She later sought uninsured motorist benefits under a business automobile liability policy issued to her employer.
In Sonya Harness v. John Mansfield et al., No. E2023-00726-COA-R3-CV, the Court of Appeals of Tennessee, Knoxville (April 30, 2025) resolved the dispute.
FACTS
Arguing that the uninsured motorist coverage in the business policy did not apply to the Ms. Harness’ accident, the insurer successfully moved for summary judgment.
At the time of the accident, she was driving her own vehicle, a Chevrolet Trax, within the course and scope of her employment. Ms. Harness had insurance coverage for her vehicle under a personal automobile liability insurance policy issued by Tennessee Farmer’s Mutual Insurance Company. Her policy included uninsured motorist coverage. Volunteer Staffing maintained a business automobile liability policy issued by The Cincinnati Insurance Company that also provided liability coverage for Ms. Harness under these circumstances.
The Commercial Policy
By its plain terms, the policy limited uninsured motorist coverage to injuries that occurred while the insured was occupying an automobile specifically listed in the declarations. Because Ms. Harness’s Chevrolet Trax was not listed, the insurer argued that the uninsured motorist coverage in the Cincinnati policy did not apply.
ANALYSIS
By statute, every general automobile liability policy issued or renewed in Tennessee must include uninsured motorist coverage. The named insured may reject coverage completely or select lower limits not less than the minimum coverage limits in [he Financial Responsibility Law in a signed writing.
It is undisputed that Ms. Harness was an additional “insured” under the liability provisions of the Cincinnati policy. As required by the statute, the Cincinnati policy includes uninsured motorist coverage with limits equal to the liability limits for bodily injury.
The Coverage Form specifies that each type of coverage in the policy only applies to the automobiles shown as covered. By its plain terms, the policy expressly limits uninsured motorist coverage to injuries that occur while occupying the one described vehicle and Ms. Harness suffered her injuries while driving her vehicle, the Chevrolet Trax not the described vehicle.
The statute mandates the coverage amount. Otherwise, the statute does not explicitly address the scope of the required coverage or dictate the form of coverage. Ms. Harness contended that the statutory requirement is “for the protection of persons insured under the policy” who are injured by an uninsured motorist. And she is an “insured” under the liability provisions of the Cincinnati policy.
The Court of Appeals noted that the statutory language does not guarantee uninsured motorist coverage for Ms. Harness in this instance. Ms. Harness’ rights under the policy necessarily depend on the choices and selections of coverage made by the named insured Volunteer Staffing that chose to include the mandated amount of uninsured motorist coverage in the Cincinnati policy. Volunteer Staffing decided to limit that coverage to specifically listed vehicles and its choices did not contravene the plain language of the uninsured motorist statute.
Because the Cincinnati policy unambiguously limits uninsured motorist coverage to injuries that occur while the insured is occupying a specifically listed vehicle and because Ms. Harness was not in that automobile the statute allowed Cincinnati to exclude from UM coverage. The limitation in the Cincinnati policy appears to be designed to avoid duplicate coverage. As such, it is a permissible limitation under the statute. The Cincinnati policy does not provide uninsured motorist coverage for Ms. Harness’s injuries.
ZALMA OPINION
Statutory interpretation by an appellate court must be reasonable and directed to fulfill the intention of the Legislature. Finding that it was appropriate to allow an insured and its insurer to limit its uninsured motorist coverage to named vehicles and limit Ms. Harness’ coverage to that she purchased for her own vehicle and not allow her to double the available coverage by recovering from her employer’s insurance which the insured refused to purchase. Reasonable interpretation made it appropriate to affirm the trial court.
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Jury’s Findings Interpreting Insurance Contract Affirmed
Post 5105
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Madelaine Chocolate Novelties, Inc. (“Madelaine Chocolate”) appealed the district court’s judgment following a jury verdict in favor of Great Northern Insurance Company (“Great Northern”) concerning storm-surge damage caused by “Superstorm Sandy” to Madelaine Chocolate’s production facilities.
In Madelaine Chocolate Novelties, Inc., d.b.a. The Madelaine Chocolate Company v. Great Northern Insurance Company, No. 23-212, United States Court of Appeals, Second Circuit (June 20, 2025) affirmed the trial court ruling in favor of the insurer.
BACKGROUND
Great Northern refused to pay the full claim amount and paid Madelaine Chocolate only about $4 million. In disclaiming coverage, Great Northern invoked the Policy’s flood-exclusion provision, which excludes, in relevant part, “loss or damage caused by ....
Failure to Name a Party as an Additional Insured Defeats Claim
Post 5104
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Contract Interpretation is Based on the Clear and Unambiguous Language of the Policy
In Associated Industries Insurance Company, Inc. v. Sentinel Insurance Company, Ltd., No. 23-CV-10400 (MMG), United States District Court, S.D. New York (June 16, 2025) an insurance coverage dispute arising from a personal injury action in New York State Supreme Court.
The underlying action, Eduardo Molina v. Venchi 2, LLC, et al., concerned injuries allegedly resulting from a construction accident at premises owned by Central Area Equities Associates LLC (CAEA) and leased by Venchi 2 LLC with the USDC required to determine who was entitled to a defense from which insurer.
KEY POINTS
Parties Involved:
CAEA is insured by Associated Industries Insurance Company, Inc. ...
Exclusion Establishes that There is No Duty to Defend Off Site Injuries
Post 5103
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Attack by Vicious Dog Excluded
In Foremost Insurance Company, Grand Rapids, Michigan v. Michael B. Steele and Sarah Brown and Kevin Lee Price, Civil Action No. 3:24-CV-00684, United States District Court, M.D. Pennsylvania (June 16, 2025)
Foremost Insurance Company (“Foremost”) sued Michael B. Steele (“Steele”), Sarah Brown (“Brown”), and Kevin Lee Price (“Price”) (collectively, “Defendants”). Foremost sought declaratory relief in the form of a declaration that
1. it owes no insurance coverage to Steele and has no duty to defend or indemnify Steele in an underlying tort action and
2. defense counsel that Foremost has assigned to Steele in the underlying action may withdraw his appearance.
Presently before the Court are two ...
ZIFL Volume 29, Issue 10
The Source for the Insurance Fraud Professional
See the full video at https://lnkd.in/gK_P4-BK and at https://lnkd.in/g2Q7BHBu, and at https://zalma.com/blog and at https://lnkd.in/gjyMWHff.
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 ...
A Heads I Win, Tails You Lose Story
Post 5062
Posted on April 30, 2025 by Barry Zalma
"This is a Fictionalized True Crime Story of Insurance Fraud that explains why Insurance Fraud is a “Heads I Win, Tails You Lose” situation for Insurers. The story is designed to help everyone to Understand How Insurance Fraud in America is Costing Everyone who Buys Insurance Thousands of Dollars Every year and Why Insurance Fraud is Safer and More Profitable for the Perpetrators than any Other Crime."
Immigrant Criminals Attempt to Profit From Insurance Fraud
People who commit insurance fraud as a profession do so because it is easy. It requires no capital investment. The risk is low and the profits are high. The ease with which large amounts of money can be made from insurance fraud removes whatever moral hesitation might stop the perpetrator from committing the crime.
The temptation to do everything outside the law was the downfall of the brothers Karamazov. The brothers had escaped prison in the old Soviet Union by immigrating to the United...
