NO. 90-272 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

1991 

ARVID GRIER, 

Plaintiff, 

-vsNATIONWIDE MUTUAL INSURANCE COMPANY, jUN - 4 1991 

ORIGINAL PROCEEDING: 

COUNSEL OF RECORD: 

For Plaintiff: 

Richard Reep argued; Graham, Reep & Spoon, 

Missoula, Montana 

For Defendant: 

Paul C. Meismer argued; Garlington, Lohn & Robinson, 

Missoula, Montana 

For Amicus Curiae: 

Molly Shepherd; Worden, Thane & Haines, Missoula, 

Montana 

Submitted: May 9, 1991 

Decided: June 4, 1991 

Filed: 
Chief Justice J. A. Turnage delivered the Opinion of the Court. 

This is a certified question submitted by the United States 

District Court for Montana. This Court accepted certification of 

the question by order dated June 5, 1990. 

The certified question as presented by the federal court was: 

Is an offset provision in an Itunderinsured 

motoristu policy, entitling the insured to an 

offset for an amount equal to the liability 

coverage available from a responsible tortfeasor, void as contrary to the public policy 

of the State of Montana? 

We rephrase the question as follows: 

Does the contested provision contained in this 

insurance policy provide uninsured motorist 

coverage or underinsured motorist coverage? 

If it provides uninsured motorist coverage, is 

the offset provision void as contrary to the 

public policy of the State of Montana? 

Nationwide Mutual Insurance Company (Nationwide) issued a 

policy of automobile liability insurance to Arvid Grier, a resident 

of Missoula, Montana. The policy provided coverage for Grierls 

1988 Dodge Caravan from December 8, 1988, through December 8, 1989. 

On December 19, 1988, while driving his Dodge Caravan, Grier 

was rear-ended by a driver insured by Farmers Union Insurance 

Company for the statutory minimum $25,000 for bodily injury. Grier 

suffered severe and permanent injuries for which Farmers Union 

Insurance Company has paid its entire $25,000 policy limit. Grier 

now seeks to recover under his own insurance policy. 
The pertinent provision of the Nationwide insurance policy is 

found at page 3 of the 1999B endorsement, under the UNINSURED 

MOTORISTS coverage: 

We will pay compensatory bodily injury (meaning bodily injury, sickness, disease, or 

death) damages that are due you by law from 

the owner or driver of an uninsured motor 

vehicle . . . ... 

An uninsured motor vehicle is: . . . 2. one which is underinsured. This is one 

for which there are bodily injury liability 

coverage or bonds in effect. Their total 

amount, however, is less than the limits of 

this coverage. These limits are shown in your 

policy's Declarations. 

The policy also provides, on the same page, under LIMITS OF 

PAYMENT, that Iv[t]he limits of this coverage will be reduced by any 

amount paid by or for any liable parties." Grierts policy of 

insurance included UNINSURED MOTORISTS coverage in the amounts of 

$25,000 for each person and $50,000 for each occurrence. 

This Court has been consistent in invalidating insurance 

contract clauses wherein the insurer attempts to limit its 

liability for uninsured motorist coverage. See, e.g., Sullivan v. 

Doe (1972), 159 Mont. 50, 495 P.2d 193; Guiberson v. Hartford Cas. 

Ins. Co. (1985), 217 Mont. 279, 704 P.2d 68. The purpose of 

Montana's uninsured motorist statute, 5 33-23-201, MCA, is the 

protection of persons insured from acts of the uninsured. 

Guiberson, 704 P.2d at 74. 
Montana has no statutory insurance requirement concerning 

underinsured motorists. The question presented by the federal 

court was whether the public policy prohibiting offsets against 

coverage for uninsured motor vehicles also extends to cases 

involving underinsured motorists. The parties have briefed this 

issue at length. 

However, the insurance policy in this case is set up in a 

unique fashion. As set forth above, the "underinsuredtt motorist 

provision is part of the section on uninsured motorist coverage. 

There is no separate policy section providing for underinsured 

motor vehicle coverage. According to the declarations page of the 

policy, no separate premium was charged for underinsured motorist 

coverage. In fact, the declarations page makes no mention 

whatsoever of underinsured motor vehicle coverage. We conclude 

that, under these circumstances, the "underinsuredtt coverage is 

part of the uninsured motor vehicle coverage. As such, the public 

policy of Montana prohibits any offset for the amount of coverage 

carried by the third-party tortfeasor. 

As the parties noted in oral argument, this Court is not 

presented with the issues of whether the insurance policy is 

ambiguous or whether the vehicle driven by the tortfeasor was 

wunderinsuredtt under Grierts insurance policy. Those are issues 

to be resolved in the federal court. 
The answer to the certified question as we have restated it 

is that the ltunderinsuredll provision in question is part of the 

uninsured motor vehicle coverage and that no offset is permissible. 

We concur: 

Chief Justice /F