Title: Dillard v. Alabama Ins. Guar. Ass'n

State: alabama

Issuer: Alabama Supreme Court

Document:

601 So. 2d 894 (1992)
Sue DILLARD
v.
ALABAMA INSURANCE GUARANTY ASSOCIATION.
1910295.

Supreme Court of Alabama.
May 8, 1992.
Rehearing Denied July 31, 1992.
William H. Atkinson of Fite, Davis and Atkinson, P.C., Hamilton, for appellant.
Allwin E. Horn III and W. Gregory Smith of Spain, Gillon, Grooms, Blan & Nettles, Birmingham, for appellee.
The Alabama Insurance Guaranty Association ("AIGA") filed a declaratory action against Denica June Densmore and Sue Dillard, seeking a judicial determination of whether, and if so to what extent, payment of uninsured/underinsured motorist benefits to Dillard offsets or reduces the amount the AIGA was obligated to pay under a policy of liability insurance, issued by the now insolvent Champion Insurance Company, which covered Densmore.
The parties entered into the following joint stipulation of facts:
Both Dillard and the AIGA moved for a summary judgment. The trial court granted the AIGA's motion for summary judgment. In its order, the trial court stated:
Dillard appeals and raises as her sole issue whether the recovery of uninsured/underinsured motorist benefits of $20,000 reduces or offsets the obligation of the AIGA under an automobile liability policy in a like amount. This same issue was recently addressed by this Court in Windle v. Alabama Insurance Guaranty Association, 591 So. 2d 78 (Ala.1991). In Windle, we held that the AIGA's obligation to pay a covered claim is reduced by the amount recovered under uninsured motorist policies.
Also, we recently decided another case that distinguished recovery of uninsured motorist benefits from recovery of underinsured motorist benefits in cases involving the AIGA. In Alabama Insurance Guaranty Association v. Hamm, 601 So. 2d 419 (Ala.1992), we held:
(Emphasis in original.)
Dillard argues that her recovery from Alfa was of underinsured benefits, and, thus, was not subject to the offset provision in the Code. However, our holding in Hamm clearly established that when benefits are paid under the claimant's uninsured/underinsured motorist policy and the tort-feasor's liability insurer is insolvent, the benefits are paid as uninsured motorist benefits. Such payments will offset the obligation of the AIGA dollar for dollar up to the policy limits. Therefore, the payment by Alfa to Dillard of $20,000 under Dillard's policy for uninsured/underinsured motorist coverage offsets the AIGA's obligation under the policy held by Densmore with Champion, which policy limits were $20,000.
The summary judgment of the trial court is affirmed.
AFFIRMED.
HORNSBY, C.J., and ALMON, ADAMS and STEAGALL, JJ., concur.