Present: Carrico, C.J., Compton, Stephenson, Whiting,1

 Lacy, 

Hassell, and Keenan, JJ. 

BARBARA E. COTCHAN, ET AL. 

OPINION BY JUSTICE ROSCOE B. STEPHENSON, JR. 

 September 15, 1995 

v. Record No. 941858 

STATE FARM FIRE & CASUALTY COMPANY 

 FROM THE CIRCUIT COURT OF PRINCE WILLIAM COUNTY 

Richard B. Potter, Judge 

 The sole issue in this appeal is whether an exclusion in an 

automobile insurance policy respecting payment of medical expense 

benefits conflicts with and is prohibited by statutory law. 

 State Farm Fire & Casualty Company (State Farm) filed a 

declaratory judgment proceeding against Barbara E. Cotchan, 

Wesley S. Cotchan, and Christopher J. Cotchan (collectively, the 

Cotchans), seeking a declaration that Christopher was not 

entitled to medical expense benefits under a family automobile 

insurance policy. The parties stipulated the facts, and each 

party moved for summary judgment. The trial court ruled in favor 

of State Farm, and the Cotchans appeal. 

 The relevant facts, as stipulated, are as follows. State 

Farm issued an automobile insurance policy to Barbara and Wesley 

Cotchan as the named insureds. In accordance with Code § 38.2-

2201, the policy provides that State Farm will pay "to or on 

behalf of each injured person, medical expense benefits as a 

result of bodily injury caused by accident and arising out of the 

 

 1Justice Whiting participated in the hearing and decision of 

this case prior to the effective date of his retirement on August 

12, 1995. 
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ownership, maintenance or use of a motor vehicle as a motor 

vehicle." The medical expense coverage provided protection not 

only to Barbara and Wesley, but also to other persons who are 

related to them by blood, marriage, or adoption and who are 

residents of the same household. See Code § 38.2-2201. An 

exclusion in the policy, however, provides that such insurance 

does not apply "to bodily injury sustained by the named insured 

or any relative while occupying any motor vehicle owned by or 

furnished or available for the regular use of such named insured 

or relative and which is not an insured motor vehicle." The only 

vehicle listed in the policy was a 1987 Chevrolet Cavalier. 

 On November 24, 1992, while the policy was in effect, 

Christopher sustained bodily injury and incurred medical expenses 

as a result of a motor vehicle collision which occurred while he 

was operating a motorcycle. The motorcycle was owned by and 

registered to Christopher and was insured for liability by 

Progressive Insurance Company (Progressive). Christopher had 

rejected medical expense coverage on his motorcycle under his 

policy with Progressive, and, therefore, the Progressive policy 

provided no medical expense benefits. 

 Christopher filed a claim with State Farm requesting payment 

of medical bills incurred for the treatment of his injuries. 

State Farm, relying on the subject policy exclusion, denied 

medical expense coverage to Christopher because the motorcycle 

was not an insured motor vehicle under the provisions of its 
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policy. 

 Code § 38.2-2201 provides, in relevant part, that an insurer 

shall provide medical expense coverage "(i) to persons occupying 

the insured motor vehicle; and (ii) to the named insured and, 

while resident of the named insured's household, the spouse and 

relatives of the named insured while in or upon, entering or 

alighting from or through being struck by a motor vehicle while 

not occupying a motor vehicle." 

 The Cotchans contend that Code § 38.2-2201 mandates medical 

expense coverage for the resident relatives of the named insured 

while in or upon any motor vehicle. The Cotchans assert, 

therefore, that the subject policy exclusion is invalid because 

it attempts to exclude coverage that is mandated by Code § 38.2-

2201. 

 State Farm asserts, on the other hand, that Code § 38.2-2201 

does not prohibit reasonable exclusions of medical expense 

coverage that are clear and unambiguous. State Farm opines that 

the subject policy exclusion is reasonable, clear, and 

unambiguous. 

 We have considered the validity of policy provisions that 

excluded medical expense coverage in two recent cases. In State 

Farm Mutual Auto. Ins. v. Gandy, 238 Va. 257, 258, 383 S.E.2d 

717, 717 (1989), the insurer agreed to pay all reasonable medical 

expenses for the named insured for bodily injury caused by 

accident through being struck by an automobile or by a trailer of 
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any type. The insurance policy further provided, however, that 

it "does not apply . . . to bodily injury . . . sustained by the 

named insured . . . through being struck by . . . a farm type 

tractor or other equipment designed for use principally off 

public roads, while not upon public roads." Id. The insured was 

injured when his foot was "run over" by a forklift while he was 

standing on private property. Id. 

 In Gandy, like the present case, the insured contended that 

the exclusion was invalid because it conflicted with the minimum 

requirements imposed by statute. We rejected the insured's 

contention and held that the exclusion was valid. In so holding, 

we noted that the statute did not address or prohibit policy 

exclusions and that the exclusion did not conflict with the 

statutory provisions. Id. at 260, 383 S.E.2d at 718-19. We 

further stated that an exclusion is valid if it is reasonable, 

clear, and unambiguous. Id. at 261, 383 S.E.2d at 719. 

 In Baker v. State Farm Mut. Auto Ins., 242 Va. 74, 75, 405 

S.E.2d 624, 624 (1991), the insured, while operating a bus in the 

course of his employment, sustained a back injury "when the 

steering on the bus locked up." The insured received workers' 

compensation benefits for his medical expenses, and also sought 

to recover a part of his medical expenses under his automobile 

insurance policy. Id. at 75-76, 405 S.E.2d at 625. The policy, 

however, provided that the medical expense benefits coverage did 

not apply "to bodily injury sustained by any person to the extent 
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that benefits therefor are in whole or in part payable under any 

[workers'] compensation law." Id. at 75, 405 S.E.2d at 624. The 

insurer, therefore, declined to pay under the policy, and the 

insured contended that the exclusion was invalid because it was 

not authorized by Code § 38.2-2201. Id. at 76, 405 S.E.2d at 

625. 

 Relying upon Gandy, we held that "a clear and unambiguous 

provision reasonably excludes medical payments coverage where 

those benefits are payable under a workers' compensation 

statute," and that, as in Gandy, the "`statute does not address, 

or prohibit, policy exclusions. Nor is there a conflict or 

inconsistency between the statutory provisions and the policy 

exclusion.'" Id. at 76, 405 S.E.2d at 625 (quoting Gandy, 238 

Va. at 260, 383 S.E.2d at 719).2

 We find the rationale in Gandy and Baker controlling in the 

present case. The policy provision excludes coverage for the 

named insured or any relative while occupying a motor vehicle 

owned by or available for the regular use of the named insured or 

relative and "which is not an insured motor vehicle." Nothing in 

Code § 38.2-2201 prohibits such exclusion, and the exclusion is 

clear and unambiguous. Moreover, as State Farm argues, the 

 

 2In Gandy, the insurer voluntarily provided medical expense 

coverage without a specific request by the insured. Therefore, 

our analysis proceeded under Code § 38.2-124(B)(1). 238 Va. at 

259, 383 S.E.2d at 718. In the present case, medical expense 

coverage was required to be provided under the provisions of Code 

§ 38.2-2201. In Baker, we held that this distinction makes no 

difference. 242 Va. at 76-77, 405 S.E.2d at 625. 
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exclusion of substantial risks that are unknown to it and for 

which it receives no premium are clearly reasonable. 

 Accordingly, we will affirm the trial court's judgment. 

Affirmed. CHIEF JUSTICE CARRICO, with whom JUSTICE LACY and JUSTCE KEENAN 

join, dissenting. 

 I would reverse. The majority acknowledges that the policy 

exclusion involved in this case is valid only if there is no 

conflict or inconsistency between the exclusion and statutory 

provisions. As pertinent here, Code § 38.2-2201(A) provides that 

medical expense coverage shall be extended: "(i) to persons 

occupying the insured motor vehicle; and (ii) to the named 

insured and, while resident of the named insured's household, the 

spouse and relatives of the named insured while in or upon, 

entering or alighting from . . . a motor vehicle." 

 In other words, the coverage provided by (i) is extended to 

all persons occupying the insured vehicle while the coverage 

provided by (ii) is extended only to the named insured and to his 

or her resident spouse and relatives. However, the coverage 

under (ii) is extended while the persons specified are occupying 

a motor vehicle, meaning any motor vehicle, whether insured or 

not. Yet, State Farm's policy exclusion would deny coverage to 

the persons specified in (ii) while occupying a vehicle that is 

not insured. Hence, there is a direct conflict or inconsistency 

between the policy exclusion and the statute, and the exclusion 

cannot stand.