Present: All the Justices 

CARL R. CATRON 

 OPINION BY JUSTICE A. CHRISTIAN COMPTON 

v. Record No. 970582 January 9, 1998 

STATE FARM MUTUAL AUTOMOBILE 

INSURANCE COMPANY, ET AL. 

FROM THE CIRCUIT COURT OF THE CITY OF ROANOKE 

Richard C. Pattisall, Judge 

 In this insurance case, we must determine the respective 

underinsurance obligations of a self-insurer and a commercial 

insurer under two statutes, one codified among the insurance laws 

and the other codified among the motor vehicle laws. 

 The facts were stipulated. On June 15, 1989, appellant 

Carl R. Catron, an employee of appellee Roanoke County acting 

within the scope of his employment, was injured when a Roanoke 

County vehicle that he was operating collided with a vehicle 

operated by Brian D. Layman. 

 At the time of the accident, Layman was insured under a 

policy issued by Rockingham Casualty Company that provided 

liability coverage limits of $100,000 for each person injured. 

At the same time, Catron was the named insured under a policy 

issued by appellee State Farm Mutual Automobile Insurance Company 

that provided uninsured motorist coverage limits of $100,000 for 

each person. 

 At the time, Roanoke County was self-insured for automobile 

liability and uninsured motorist coverage purposes, and also for 

workers' compensation purposes. The County's limit of liability 
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for uninsured motorist coverage was $25,000 for each person. 

 The County has paid in excess of $222,325 in benefits to 

Catron pursuant to its obligations under the Virginia Workers' 

Compensation Act for injuries he sustained in the accident. The 

County continues to be liable for benefits under the Act. 

 Rockingham tendered a check to Catron in the amount of 

$100,000, its policy limits. The County claims entitlement to 

those proceeds as a result of its payment of workers' 

compensation benefits. 

 In July 1994, Catron filed the present motion for 

declaratory judgment naming State Farm, Layman, the County, and 

Rockingham as defendants. Asserting he has incurred medical 

expenses and lost wages in excess of $125,000, plaintiff asked 

the court to declare that State Farm has the obligation to pay 

him $25,000 based on the applicable priority of underinsured 

coverage in the case. State Farm denied that it owed the 

plaintiff any insurance benefits under the circumstances. 

 The pleadings and stipulation presented a pure question of 

law and, upon consideration of argument of counsel, the trial 

court ruled against the plaintiff. The court held that State 

Farm's uninsured/underinsured motorist coverage was primary 

coverage and that it owed no payment to the plaintiff. The court 

also held that the self-insured uninsured/underinsured motorist 

benefit provided by the County was secondary coverage. 

 The plaintiff appeals. The County, although nominally an 
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appellee, supports the plaintiff's position on appeal. 

 We shall summarize the statutes pertinent to this 

controversy. The uninsured motorist statute requires a motor 

vehicle liability policy to provide at least $25,000 for each 

person in uninsured motorist coverage through provisions that 

"also obligate the insurer to make payment for bodily injury 

. . . caused by the operation or use of an underinsured motor 

vehicle to the extent the vehicle is underinsured, as defined in 

subsection B of this section." Code § 38.2-2206(A). 

 Subsection B states that a motor vehicle is "underinsured" 

if "the total amount of bodily injury . . . coverage applicable 

to the operation or use of the motor vehicle and available for 

payment for such bodily injury . . . is less than the total 

amount of uninsured motorist coverage afforded any person injured 

as a result of the operation or use of the vehicle." Code 

§ 38.2-2206(B). 

 The same subsection provides that "available for payment" 

means "the amount of liability insurance coverage applicable to 

the claim of the injured person for bodily injury . . . reduced 

by the payment of any other claims arising out of the same 

occurrence." Id.

 A focus of this appeal is upon the following provisions of 

subsection (B). 

 "If an injured person is entitled to underinsured 

motorist coverage under more than one policy, the 

following order of priority of policies applies and 

any amount available for payment shall be credited 

against such policies in the following order of 
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priority: 

 1. The policy covering a motor vehicle occupied by 

the injured person at the time of the accident; 

 2. The policy covering a motor vehicle not 

involved in the accident under which the injured 

person is a named insured; 

 3. The policy covering a motor vehicle not 

involved in the accident under which the injured 

person is an insured other than a named insured; 

 Where there is more than one insurer providing 

coverage under one of the payment priorities set 

forth, their liability shall be proportioned as to 

their respective underinsured motorist coverages." 

 The appeal also focuses on Code § 46.2-368 (formerly 

§ 46.1-395), codified among the motor vehicle laws. This statute 

deals with the discretionary power of the Commissioner of the 

Department of Motor Vehicles to issue certificates of selfinsurance. 

 It specifies the certificate must provide protection 

against an uninsured or underinsured motorist "to the extent 

required by § 38.2-2206." It also provides that "protection 

against the uninsured or underinsured motorist required under 

this section . . . shall be secondary coverage to any other valid 

and collectible insurance providing the same protection which is 

available to any person otherwise entitled to assert a claim to 

such protection by virtue of this section." § 46.2-368(B). 

 On appeal, the plaintiff contends the trial court erred in 

ruling that the credit priorities of § 38.2-2206(B) were reversed 

by the "secondary" language of § 46.2-368(B). 
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 The plaintiff argues he met the definition of 

"underinsured" in 2206(B). He says the amount of coverage 

"available for payment" is $100,000, the full amount of the 

bodily injury liability coverage of Layman's Rockingham policy. 

This sum is less than the total amount of uninsured motorist 

coverage afforded him, which is $125,000 (the County's $25,000 

uninsured coverage plus the plaintiff's $100,000 State Farm 

policy in which he was the named insured). Consequently, he 

argues, he was underinsured in the amount of $25,000. 

 Continuing, the plaintiff argues that the "order of 

priorities for crediting an amount available for payment against 

the underinsured coverage is controlled by § 38.2-2206(B)(1)." 

He contends that the statutory language establishes the following 

order of credits: (1) $25,000 uninsured coverage from the County 

(the policy covering the vehicle occupied by the injured person 

at the time of the accident); and (2) $100,000 uninsured coverage 

from plaintiff's State Farm policy (the policy covering a vehicle 

not involved in the accident but under which the injured person 

is a named insured). 

 Therefore, the plaintiff contends, "[t]he entire $25,000 of 

Roanoke County's coverage is covered by the $100,000 credit. The 

remaining $75,000 of that $100,000 credit covers $75,000 of State 

Farm's $100,000." Thus, plaintiff concludes, $25,000 remains and 

State Farm will owe that amount if his personal injury claim is 

tried or settled for an amount equal to or more than $125,000. 
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 State Farm, on the other hand, argues the trial court 

correctly ruled that its coverage was primary and the County's 

coverage was secondary. Because the municipal self-insurance is 

secondary, State Farm argues, State Farm's coverage assumes the 

"position of primary coverage in the UIM calculation," meaning 

that "State Farm's policy is first in line for payment and also 

for the credit generated by the available liability coverage." 

Thus, it contends, "that credit covers all of State Farm's 

potential coverage, and State Farm owes nothing in this case." 

 State Farm argues "the legislature meant what it said" in 

Code § 46.2-368(B) "when it made a self-insurer `secondary' for 

purposes of coverage analysis under the Virginia UM/UIM statute, 

Code § 38.2-2206." Embarking on what it calls a "chronological 

review of the relevant statutory and decisional history" of the 

subject, State Farm urges there is "no doubt" that the County, 

"as a UM/UIM self-insurer, is subject to the requirements of Code 

§ 38.2-2206 in all respects except that its coverage is 

`secondary' for all purposes." 

 State Farm argues that, since 1972, "former Code § 46.1-395 

and current Code § 46.2-368 have required self-insurers to 

provide UM coverage, but have placed self-insurers categorically 

in the `secondary' position for purposes of UM coverage 

priority." State Farm contends that, in 1988, "sixteen years 

after self-insurers first became obligated to provide `secondary' 

UM coverage, Code § 38.2-2206 was amended to create a single, 
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statutory priority rule for multiple applicable UIM coverages -- 

a priority that governs the order in which the coverages line up 

both for payment and for allocation of the `credit' for available 

liability coverage." 

 Continuing, State Farm urges that, regarding "coverage on 

the vehicle involved in the accident, self-insured coverage 

ordinarily would be first priority UIM coverage for purposes of 

payment and allocation of the credit under Code § 38.2-2206. The 

categorical command of Code § 46.2-368, however, makes the selfinsured coverage `secondary' to all other coverages, meaning that 

it comes last for purposes of payment and allocation of the 

credit. This is the conclusion that the trial court correctly 

reached in this case." 

 Finally, State Farm contends the plaintiff's argument rests 

on a "misreading" of Code § 38.2-2206. It claims the General 

Assembly did not intend "to make self-insurers secondary for some 

purposes but primary for other purposes under Code § 38.2-2206." 

 It argues "Code § 38.2-2206(B) establishes a single order of 

priority among applicable UIM coverages and endows that order of 

priority with two consequences: it governs both the order in 

which UIM coverage pay[s] and the order in which available 

liability insurance is credited. Code § 46.2-368 make[s] selfinsured UM/UIM coverages `secondary' to all other coverages for 

all purposes, without distinction." We do not agree with State 

Farm. 
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 We have already determined "the language of Code § 38.2-

2206(B) to be clear and unambiguous." Dairyland Ins. Co. v. 

Sylva, 242 Va. 191, 195, 409 S.E.2d 127, 129 (1991). And, when 

statutory language is clear and unambiguous, "there is no need 

for construction by the court; the plain meaning and intent of 

the enactment will be given it." Brown v. Lukhard, 229 Va. 316, 

321, 330 S.E.2d 84, 87 (1985). Unless a literal interpretation 

of statutory language will amount to a manifest absurdity, courts 

should not adopt a construction that, in effect, holds the 

legislature did not mean what it actually has expressed. Sylva, 

242 Va. at 194, 409 S.E.2d at 129. 

 We shall read § 38.2-2206(B) literally, for the moment 

without regard to § 46.2-368. The applicable "order of priority 

of policies" dictates that the sum available for "payment" shall 

be "credited" against the several policies in "the following 

order of priority:" first, the County's $25,000, from the policy 

covering the County motor vehicle occupied by the plaintiff at 

the time of the accident (there is no dispute that a selfinsurer's certificate of insurance is equivalent to an insurance 

"policy" for purposes of this controversy); second, State Farm's 

$100,000, from the policy covering a motor vehicle not involved 

in the accident under which the plaintiff was the named insured. 

 Code § 46.2-368(B), however, provides that the "protection 

against the uninsured or underinsured motorist required under 

this section . . . shall be secondary coverage to any other valid 
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and collectible insurance providing the same protection which is 

available to any person otherwise entitled to assert a claim to 

such protection by virtue of this section." We hold that this 

language does not alter or reverse the credit priorities, as 

opposed to the payment priorities, set forth in § 38.2-2206(B). 

 The General Assembly, in what is now § 46.2-368, has 

recognized "a distinction in the financial implications of 

recovery from self-insurers and recovery from commercial 

insurers." William v. City of Newport News, 240 Va. 425, 432, 

397 S.E.2d 813, 817 (1990). The legislature has placed selfinsurers in a favored status. For example, the proviso in Code 

§ 38.2-2206(I) requires a self-insurer's workers' compensation 

payments to be set off against any judgment for damages awarded 

pursuant to the statute for personal injuries resulting from the 

industrial accident. 

 Consistent with the foregoing legislative policy, the 

General Assembly has not specified that the "secondary" language 

in 368 modifies the credit priority design of 2206. Nowhere in 

368 are the words "credit" or "priority" used. Surely, if the 

General Assembly had intended 368 to modify the credit priorities 

of 2206, it would have included language to effect that purpose, 

so that a self-insurer always would be prohibited from assuming a 

first priority credit position. This has not been done. 

 As the plaintiff points out, State Farm seeks a reading of 

the statutes "that will push its $100,000 credit ahead of Roanoke 
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County's $25,000 credit, so that its underinsurance coverage will 

be totally set off by the credit, and the County will therefore 

bear the entire burden of the underinsurance coverage . . . . 

[T]his would totally defeat the legislative intent behind § 46.2-

368(B)." 

 Finally, State Farm relies heavily on Hackett v. Arlington 

County, 247 Va. 41, 439 S.E.2d 348 (1994), a case decided before 

the 1995 amendment to § 46.2-368(B) that obligated self-insurers 

to provide underinsured motorist coverage. See Acts 1995, ch. 

85. There, we stated: "The sole question presented in this 

appeal is whether Arlington County, a self-insured entity, is 

required to provide underinsurance coverage to an employee." 247 

Va. at 42, 439 S.E.2d at 348. Interpreting § 46.2-368(B) with 

§ 38.2-2206, we answered the query in the affirmative. Hackett

is not controlling here. The issues in the two cases are 

entirely different. 

 Consequently, we hold that the trial court erred in ruling 

§ 46.2-368(B) modified the credit priorities of § 38.2-2206. We 

will reverse the judgment below and enter final judgment here in 

favor of the plaintiff. We will declare that Code § 38.2-2206(B) 

controls the coverage credit priorities in this case and that 

State Farm is liable to the plaintiff for $25,000 if there is a 

settlement or judgment in the plaintiff's personal injury claim 

equal to or in excess of $125,000. 
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 Reversed and final judgment.