UIM Coverage Not Available for Driver's Negligence: UIM Coverage Only Available When Insured Injured by a Third Party.

• Author: Zalma, Barry
• Position: [ON MY RADAR]

* Uninsured Motorist (UM) and Underinsured Motorist (UIM) coverages are designed to provide indemnity to an insured who is injured by an uninsured or underinsured motorists negligence. It is not designed to supplement the liability coverage of the negligent person.

In Simmons v. Geico Indemnity Company, Not Reported in S.W.3d, Court of Appeals of Kentucky, 2016 WL 4575669 (9/2/2016), the Kentucky Court of Appeals was asked to broaden the coverages available to the injured person.

ISSUE

This case involves a dispute over insurance coverage. The issue presented is whether the decedent's estate may recover Underinsured Motorist (UIM) benefits on behalf of the decedent under a policy of insurance tendered by Geico Indemnity Company. The circuit court found it could not.

FACTS AND PROCEDURE

On August 16, 2012, the decedent, Charles Simmons, was a passenger in a 2003 Chevrolet Blazer that he owned. Charles' stepson, Michael Mundy, was driving. Mundy, traveling westbound, crossed the center line and collided head-on with an eastbound vehicle. The collision claimed Charles' life.

The Blazer was insured pursuant to a policy issued by Geico to Charles and Lenora Simmons. The policy provided liability coverage up to $25,000 per person ($50,000 per occurrence) and included UIM coverage with policy limits of $25,000.00 per person. Mundy was named an "additional driver" under the policy.

Appellant Lenora Simmons, in her individual capacity and as Executrix of the Estate of Charles Simmons, filed the underlying action seeking a declaratory judgment that the Geico policy provided UIM benefits to which the Estate was entitled. Geico counterclaimed, requesting a declaration that the policy's express terms explicitly excluded UIM coverage for this particular collision because the vehicle driven by Mundy was not an "underinsured auto."

The parties filed competing motions for declaratory summary judgment. By Order entered April 15, 2014, the circuit court granted Geico's motion, finding the insurance policy did not provide UIM coverage for the subject collision.

ANALYSIS

The sole issue, as framed, is whether Charles was entitled to UIM benefits under his own insurance policy with Geico for this particular accident.

As a general rule, the construction and legal effect of an insurance contract is a matter of law for the court. A court must give clear and unambiguous terms in an insurance policy their plain and ordinary meaning.

The policy at issue states Geico...