1 No. 1 2 2

, 701

IN THE COURT OF APPEALS OF THE STATE OF KANSAS

R OGER W. M C L EAN

, i n H is Capacity a s t he Special Administrator o f t he Estate o f Roger

G . Yarbro Sr., a nd Clyde David Yarbro

, A ppellant s / C ross

- appellees

,

v.

N ATIONAL U NION F IRE I NSURANCE C OMPANY O F P ITTSBURGH

, P.A.,

A ppellee / C ros s

- appellant

.

SYLLABUS BY THE COURT

1.

The overall purpose of K.S.A. 40

- 284, the statute mandating uninsured and

underinsured motorist coverage in all automobile policies

, is to fill a gap in motor vehicle

financial responsibility and compulsory insurance legislation. The coverage is intended to

compensate innocent persons who are damaged through the wrongful conduct of a

motorist who, because they are uninsured or underins ured and not financially responsible,

cannot be made to respond in damages.

2.

K.S.A. 40

- 284 is remedial. It should be liberally construed to provide broad

protection to the insured against all damages resulting from bodily injuries sustained by

the insu red that are caused by an automobile accident where those damages are caused by

the acts of an uninsured or underinsured motorist. The insurance policy containing the

coverage is controlling only to the extent it does not conflict with or attempt to dimini sh

or omit statutorily mandated coverage.2

3.

Kansas law requires that underinsured motorist coverage in an automobile policy

must have coverage limits equal to the liability coverage of the policy. K.S.A. 40

- 284(b).

4.

The named insured has the right to reject, in writing, the uninsured and

underinsured motorist coverages required by subsections (a) and (b) which exceeds the

Kansas minimum limit of $25,000. A ny attempt to reject uninsured coverage in excess of

the statutory minimum must be (1) in writing, as required by K.S.A. 40

- 284(c), and (2)

the product of an affirmative, unequivocal act specifying the insured's rejection of excess

coverage.

5.

When the terms of an insurance policy are ambiguous, the ambiguity is construed

against the insurance company. Because the insurer prepares its own contracts, it has a

duty to make the meaning clear. If the insurer intends to restrict or limit coverage und er

the policy, it must use clear and unambiguous language. Otherwise, the policy will be

liberally construed in favor of the insured. The test is not what the insurer intends the

language to mean, but what a reasonably prudent insured would understand the language

to mean.

6.

If a tentative agreement to settle for liability limits has been reached with an

underinsured tortfeasor, written notice must be given by certified mail to the

underinsured motorist coverage insurer by its insured. The underinsured m otorist

coverage insurer then has 60 days to substitute its payment to the insured for the tentative

settlement amount.3

Appeal from Wyandotte District Court; C ONSTANCE M. A LVEY

, judge. Opinion filed June 18,

2021

. Reversed and remanded with directions

.

John G. O'Connor , of Rob b , Taylor & O'Connor, of Kansas City, for appellants/cross

- appellees.

J. Philip Davidson and Paul J. Skolaut

, of Hinkle Law Firm LLC, of Wichita, for appellee/cross

appellant.

B efore A RNOLD

- B URGER

, C.J., H ILL

, J., and M C A NANY

, S.J.

H ILL

, J.: This lawsuit seeks underinsured motorist benefits from an employer's

automobile insurance carrier. The insurer sought summary judgment on two grounds. The

court granted summary judgment on one theory and denied the claima nts any coverage.

At the same time, the court denied judgment to the insurance company on the second

theory. Both sides appeal. Our review leads us to hold that the court incorrectly granted

summary judgment to the insurance carrier on the first theory and incorrectly denied

summary judgment to the insurance carrier on the second. Thus, we must reverse both

rulings. The claimants win one battle but lose the war.

A bus driver was injured in a collision.

Roger G . Yarbro Sr. was driving a school bus in 201 1 for his employer,

FirstGroup America, Inc., when the bus was struck by a vehicle driven by Christopher

Hernandez. FirstGroup was insured by National Union Fire Insurance Company of

Pittsburgh, P

. A. The insurance policy had a liability limit of $5,000,000 . But an insurance

adjuster sent a letter to Yarbro's counsel advising that the uninsured motorist coverage

under the policy was limited to the Kansas minimum limit of $25,000, which would be

"equal or less th [ a ] n " Hernandez' policy limit. Without telling National Union, Yarbro

settled his personal injury claim against Hernandez for Hernandez' policy limit of

$100,000.4

Yarbro died in 2015. After his death, the administrator of Yarbro's estate and

Clyde David Yarbro , an heir, sued National Union

, for underinsured motorist benefits.

They lost.

Two of the district court's rulings are the subject of this appeal and cross

- appeal.

Yarbro and the Estate appeal the court's grant of summary judgment to National Union

based on its ruling that FirstGroup had waived underinsured motorist coverage in writing.

At the same time, the court denied summary judgment to National Union on a theory that

Yarbro had forfeited any claim for underinsured motorist benefits by failing to notify

National Union of a tentative settlement with the tortfeasor, Hernandez, as required by

law. National Union appeals that ruling in a cross

- appeal.

We first revie w some fundamental principles of automobile insurance law to

provide a context for our analysis and ruling.

Kansas law requires all automobile insurance policies to have certain provisions.

When the Legislature embraced comparative fault principles, a n egligent tortfeasor

would be financially responsible only for the damages he or she had caused

— and no

more. And when it made this change, it required all motor vehicles to be covered by

liability insurance. In other words, Kansas has compulsory automobile insurance.

All policies were, by law, required to have a minimum coverage amount of

$25,000 that of course could be higher as the insured and insurer agreed. The law also

required other types of benefits and coverages to be provided in all policies

, which we

will not review as they are not pertinent to our analysis.

One mandatory provision , however, is pertinent. Recognizing reality, the law in

1968 required all motor vehicle policies to provide uninsured motorist coverage with5

coverage limits equal to t he limits of the liability coverage under the policy. K.S.A. 40

-

284(a). The Legislature foresaw that perhaps not everybody driving on our roads would

comply with this law requiring insurance, so a driver's own policy could provide some

financial protection for the driver.

A few years later, in 1981, the Legislature required underinsured motorist

coverage to also be included in all policies. Like uninsured coverage, u nderinsured

coverage limits were to equal the limits of liability provided by such uninsur ed motorist

coverage to the extent such coverage exceeds the limits of the bodily injury coverage

carried by the owner or operator of the other motor vehicle. K.S.A. 40

- 284(b).

The two policy provisions

— uninsured and underinsured

— may be cousins, but

the y are not identical.

Over the years, caselaw has made manifest certain principles about these two

required coverages. The overall purpose of K.S.A. 40

- 284 was to fill a gap in motor

vehicle financial responsibility and compulsory insurance legislation. T he coverage is

intended to compensate innocent persons who are damaged through the wrongful conduct

of a motorist who, because they are uninsured or underinsured and not financially

responsible, cannot be made to respond in damages.

The statute is remedial. It should be liberally construed to provide broad protection

to the insured against all damages resulting from bodily injuries sustained by the insured

that are caused by an automobile accident where those damages are caused by the acts of

an uninsured or underinsured motorist. O'Donoghue v. Farm Bureau Mut. Ins. Co. , 275

Kan. 430, 437, 66 P.3d 822 (2003). The insurance policy is controlling only to the extent

it does not conflict with or attempt to diminish or omit statutorily mand ated coverage.

Hemenway v. Auto mobile Club Inter

- I nsurance Exch ange , 57 Kan. App. 2d 109, Syl. ¶ 6

,

447 P.3d 382 (2019), rev. denied 311 Kan. 1045 (2020).6

Our Supreme Court has expressed the relationship between subsections (a) and (b)

of K.S.A. 40

- 284 as a syllogism. Under K.S.A. 40

- 284(a), the policy limits of an

uninsured motorist provision must be equal to the liability coverage in the insurance

policy. Under K.S.A. 40

- 284(b), uninsured motorist coverage must include an

underinsured motorist provision with coverage limits equal to the uninsured provision.

Kansas law thus requires that underinsured motorist coverage in an automobile policy

must have covera ge limits equal to the liability coverage of the policy. Mitchell v. Liberty

Mut. Ins. Co. , 265 Kan. 556, 559, 961 P.2d 1235 (1998).

We find one case significant. In McTaggart v. Liberty Mut. Ins. , 267 Kan. 641,

651, 983 P.2d 853 (1999), the court noted that while " the two coverages are separate, the

statute treats the underinsured motorist coverage as a subcategory of uninsured motorist

coverage ' include[d] ' in the uninsured motorist coverage. " But the rejection form the

court approved in that case did specifically inform the insured that " underinsured"

motorist coverage was being rejected. The form stated: " ' I have been given the

opportunity to purchase Uninsured Motorists Insurance (including Underinsured

Motorists Protection) equal to my limits of liability of bodily injury or death, and instead

I select lower limits of

. . . .' " 267 Kan. at 648. The court h eld the language used in the

form was " sufficiently clear in specifying that the higher limit for underinsured motorist

coverage

, not just uninsured motorist coverage, is being rejected. " 267 Kan. at 651.

To us, this holding implies that a rejection form which does not reject the higher

limit for underinsured motorist coverage is not a valid rejection of that higher limit for

such coverage. The McTaggart court did not face the facts presented here, where the term

"underinsure d" does not appear on the rejection form.

We have one final note about these two coverages. The named insured has the

right to reject, in writing, the uninsured and underinsured motorist coverages required by

subsections (a) and (b) which exceeds the Kans as minimum limit of $25,000. See K.S.A.7

40

- 284(c). In other words, the law requires coverage in the amount of the liability

coverage on the policy, but an insured can choose only the statutory minimum amount if

they wish. This brings us to the first issue

— D id the employer, FirstGroup

, validly reject

underinsured coverage under the facts here?

When it granted summary judgment, the district court ruled that FirstGroup had

rejected the higher coverage. Summary judgment is appropriate when the record shows

no genuine issue exists about any material fact and that the moving party is entitled to

judgment as a matter of law. Appellate review of the legal effect of undisputed facts is de

novo. GFTLenexa, LLC v. City of Lenexa , 310 Kan. 976, 981

- 82, 453 P.3d 304 (2 019).

Here, the facts are undisputed.

Yarbro and the Estate do not dispute that FirstGroup executed a valid written

rejection of "uninsured" motorist coverage in excess of $25,000. But they argue that there

was no such written rejection of "underinsured" motorist coverage because underinsured

coverage is not mentioned in the rejection form. Thus, in their view, the policy contains

underinsured coverage equal to the liability limit of $5,000,000.

National Union contends that since the definition of uninsured motorist coverage

in its policy included underinsured motorist coverage, that its rejection form meets the

requirements of K.S.A. 40

- 284(c), and that its rejection form did not have to include the

term "underinsured" because Ka nsas law treats underinsured motorist coverage as a

subcategory of uninsured motorist coverage.

Why the district court was wrong on the first issue.

We hold the district court misinterpreted both th e insurance policy and the

rejection form signed by FirstGroup. We find no unequivocal rejection of underinsured8

limits less than the liability limits of the policy with National Union in this record. In fact,

the rejection form did not even mention underinsured motorist coverage.

Interpretation of an ins urance policy is a question of law over which appellate

courts have unlimited review. When the terms of an insurance policy are ambiguous, the

ambiguity is construed against the insurance company. Because the insurer prepares its

own contracts, it has a du ty to make the meaning clear. If the insurer intends to restrict or

limit coverage under the policy, it must use clear and unambiguous language. Otherwise,

the policy will be liberally construed in favor of the insured. The test is not what the

insurer int ends the language to mean, but what a reasonably prudent insured would

understand the language to mean. Bussman v. Safeco Ins. Co. of Am. , 298 Kan. 700, 707,

317 P.3d 70 (2014).

Kansas courts liberally construe K.S.A. 40

- 284 to protect the insured's right to

uninsured motorist coverage and strictly construe policy provisions trying to limit such

coverage. Escue v. Allstate Fire & Cas. Ins. Co. , No. 19

- 1271

- EFM, 2020 WL 7042598,

at *3 (D. Kan. 2020). A ny attempt to reject uninsured coverage in excess of the statutory

minimum must be (1) in writing, as required by K.S.A. 40

- 284(c), and (2) the product of

an affirmative, unequivocal act specifying the insured's rejection of excess coverage.

Bishop v. Empire Fire & Marine Ins. Co. , 47 F. Supp. 2d 1300, 1306 (D. Kan. 1999).

Because the rejection provisions of K.S.A. 40

- 284(c) detract from the public

policy goals of protecting innocent victims, the rejection provisions are narrowly and

strictly construed

. Even so, strict construction should not be invoked to cir cumvent

application of an election under K.S.A. 40

- 284(c) that is apparent from the four corners

of the insurance policy and the rejection form. Ochs v. Federated Mut. Ins. Co. , 43 Kan.

App. 2d 127, 133

- 34, 221 P.3d 622 (2010). The terms of the signed reje ction form

became part of the insurance contract between the parties. Wh ere the insurance contract9

is not ambiguous, courts do not make another contract for the parties but will enforce the

contract as written. 43 Kan. App. 2d at 137.

Some policy details are important to our reasoning.

In the insurance agreement between National Union and FirstGroup, the

"SCHEDULE OF COVERAGES" lists 12 different types of coverage. Liability coverage

is at the top with a $5,000,000 coverage limit. Uninsured motor ist coverage and

underinsured motorist coverage are separately listed. Under the entry for underinsured

motorist coverage there is a note in parenthesis that states

, " ( When not included in

Uninsured Motorists Coverage )

. " The limits for uninsured motorist c overage are

"SEPARATELY STATED IN EACH UNINSURED MOTORISTS ENDORSEMENT."

And the limits for underinsured motorist coverage are "SEPARATELY STATED IN

EACH UNDERINSURED MOTORISTS ENDORSEMENT." We find no underinsured

motorist endorsement included in this pol icy.

As part of the policy, there is another document titled

, "KANSAS SPLIT

UNINSURED MOTORISTS COVERAGE LIMITS." This document states that it

modifies the "UNINSURED MOTORISTS COVERAGE ENDORSEMENT." It lists the

coverage limits for bodily injury as $25,000 for each person and $50,000 for each

accident. Within the d efinition section of the "KANSAS UNINSURED MOTORISTS

COVERAGE" endorsement, an "Uninsured motor vehicle" means a land motor vehicle or

trailer:

"a

. For which no liability bond or policy at the time of an 'accident' provides at least the

amounts required by Kansas law, or

" b

. That is an underinsured motor vehicle . An underinsured motor vehicle is a land motor

vehicle or 'trailer' for which the sum of all liability bonds or policies at the time of an

'accident' provides at least the amounts required by Kans as law, but their limits are

less than the limit of this insurance, or10

" c. For which an insuring or bonding company denies coverage or is or becomes

insolvent, or

" d. For which neither the driver nor owner can be identified." (Emphasis added.)

Finally, the policy contains a document titled

, "KANSAS NOTICE UNINSURED

MOTORISTS COVERAGE" (the rejection form) that states:

"Kansas law requires us to provide Uninsured Motorists Coverage in your policy with a

coverage limit equal to your policy's bodily injury limit of liability. You are not required

to accept Uninsured Motorists Coverage at this coverage limit. You may select a lower

coverage limit, but the coverage lim it you select may not be lower than Kansas' minimum

requirement, which is split limits of $25,000 each person and (subject to the each person

limit) $50,000 each accident. This coverage limit may be selected as a combined single

limit of $50,000 each accid ent."

FirstGroup selected "Uninsured Motorists Coverage with a coverage limit equal to

Kansas' minimum requirement" split limits. This rejection form does not mention

underinsured motorist coverage.

From the four corners of this insurance contract, it is not apparent when

underinsured motorist coverage is included within the uninsured motorist coverage and

when it is not. On the schedule of coverages, uninsured motorist coverage and

underinsured motorist coverage are separate line items. The schedule o f coverages shows

there is supposed to be a separate underinsured motorist coverage endorsement that

provides the coverage limits for underinsured coverage, but one was apparently not

provided to FirstGroup.

The schedule shows that underinsured coverage may be included within uninsured

coverage for some purposes

, but does not specify for what purposes. A close reading of

the Kansas uninsured coverage endorsement reveals that an uninsured motor vehicle11

includes an underinsured motor vehicle for purposes of that document. But there is no

indication on the rejection form that underinsured motorist coverage is included under

uninsured motorist coverage for purposes of the rejection. It is ambiguous.

This ambiguity must be construed against National Union. If National Union

intended for underinsured coverage to be included on the rejection form, it could have so

stated. FirstGroup did not affirmatively and unequivocally reject in writing excess

underinsured coverage as required by K.S.A. 40

- 284(c).

Finally, we are unmoved by the parties' argument about whether certain rejection

forms were approved by the Department of Insurance. We no longer apply the doctrine of

operative construction. We give no deference to administrative agencies' interpretations

of their own implementing statutes when we are construing such statutes. The doctrine is

now invalid. Golden Rule Ins. Co. v. Tomlinson , 300 Kan. 944, 955, 335 P.3d 1178

(2014).

Thus, the district court erred when it granted summary judgment to National

Union on this point. We must reverse and set aside that summary judgment. We turn now

to the cross

- appeal.

The cross

- appeal has merit.

In its cross

- appeal, National Union contends that Yarbro had to provide notice to

National Union of any tentative settlement under K .S.A. 40

- 284(f). When he failed to do

so

, Yarbro waived any right to underinsured motorist benefits under the policy. In

response, Yarbro and the Estate contend that when National Union denied the existence

of any underinsured motorist coverage in a letter dated January 2012, the insurer waived

its right to receive notice under K.S.A. 40

- 284(f). Thus, National Union should be

estopped from raising this argument.12

To solve this proble m, we must begin with the statute which gives an insurer the

right to pay the claim instead of the tortfeasor and then pursue a subrogation claim

against the tortfeasor for what it has paid.

"If a tentative agreement to settle for liability limits has be en reached with an

underinsured tortfeasor, written notice must be given by certified mail to the

underinsured motorist coverage insurer by its insured." K.S.A. 40

- 284(f). The

underinsured motorist coverage insurer then has 60 days to substitute its paymen t to the

insured for the tentative settlement amount.

If the underinsured motorist coverage insurer substitutes payment, the insurer is

then subrogated to the insured's right of recovery to the extent of such payment and any

settlement under the underins ured motorist coverage

. If the insurer does not substitute

payment within 60 days, the insurer has no right of subrogation for any amount paid

under the underinsured motorist coverage. K.S.A. 40

- 284(f).

To sum up, this law requires notice of tentative settlement, a timely substitute

payment by the underinsured motorist coverage carrier, and then subrogation rights are

preserved.

An underinsured motorist insurance carrier that pays on a claim has the righ t to

maintain a subrogation action against the party responsible for the motor vehicle

collision. But the insurer's right to proceed against the responsible party stems from the

rights of the injured insured. Thus, if the insured settles with the responsib le party and

executes a release of liability in favor of the responsible party, the insurer's subrogation

right is impaired. The statute permits the insured to negotiate a speedy settlement while

preserving the underinsured motorist insurer's subrogation r ight if it tenders substitute

payment to the insured for the settlement amount. Anderson v. Emp loyer s Mut ual

Cas ualty Ins. Co. , 27 Kan. App. 2d 623, 627

- 28, 6 P.3d 918 (2000).13

A case that offers guidance on this issue is Dalke v. Allstate Ins. Co. , 23 Kan. App.

2d 742, Syl. ¶ 4, 935 P.2d 1067 (1997). The Dalke panel held that an insured who settles

his or her claim for injuries against an underinsured motorist and who releases t hat

tortfeasor from further liability, all without notice to such insured's insurance carrier as

required by K.S.A. 40

- 284(f), forfeits the right to recover under his or her policy's

underinsured motorist provision. The court noted that the language of K.S.A. 40

- 284(f)

contained no specific consequence to the insured for noncompliance with the notification

requirement. But the court considered the mandatory language of K.S.A. 40

- 284(f), that

Dalke's noncompliance had led to the loss of Allstate's subrogation rights, and public

policy. 23 Kan. App. 2d at 747

- 49; see also Owens v. Continental Ins. Co.

, No. 99

- 3201,

2000 WL 703133, at * 4

- 6 (10th Cir. 2000) (unpublished opinion) (following Dalke ).

Dalke is horizontal pr ecedent and not binding authority upon this panel

. We have

some reservations about the holding. The statute does not say that the insured forfeits the

right to recover underinsured motorist benefits by failing to provide notice to the

carrier

— the panel did

. On the other hand, the statute also does not say that an insurer

waives the right to notice under K.S.A. 40

- 284(f) by denying coverage as Yarbro and the

Estate contend.

In a different context, a panel of this court held that failure to comply with K.S.A.

40

- 284(f) and K.S.A. 40

- 287 precluded a remedy in equity. In Farm Bureau Mut. Ins.

Co. v. Progressive Direct Ins. Co. , 40 Kan. App. 2d 123, 130

- 31, 190 P.3d 989 (2008), a n

underinsured motorist insurance carrier substituted payment after receiving notice of

tentative settlement in accordance with K.S.A. 40

- 284(f). But the underinsured insurance

carrier failed to sue before the statute of limitations ran. This court held th e insurance

carrier could not invoke equity because it failed to seize the chance to bring a timely tort

action. " ' Equity aids the vigilant and not those who slumber on their rights. ' " 40 Kan.

App. 2d at 131. The failure to comply with statutory requiremen ts when the insurance

carrier could have done so precluded a remedy in equity.14

Both cases recognize that K.S.A. 40

- 284(f) creates and preserves an insurer ' s right

to subrogation and promotes the public policy of making the tortfeasor responsible for the

damages he or she has caused. We cannot ignore the importance of these policies and

follow the Dalke holding.

Where the court got it wrong on this issue

.

After reviewing the facts, the case law, and the statute, we hold the January 2012

letter was not a waiver of notice of settlement by National Union. Waiver in contract law

implies that a party has voluntarily and intentionally given up a known right or has done

some positive act inconsistent with the contractua l right. Once it has been established that

a right has been waived, the party possessing the contractual right is precluded from

asserting it in a court of law.

Equitable estoppel is the effect of the voluntary conduct through which the party is

preclude d, both at law and in equity, from asserting a right against another person relying

on such conduct. A party asserting equitable estoppel must show that another party, by

acts, representations, admissions, or silence when it had a duty to speak, induced it to

believe certain facts existed. The party must also show it rightfully relied and acted on

such belief and would now be prejudiced if the other party could deny the existence of

such facts. Steckline Comm unications

, Inc. v. J ournal Broad cast Gr ou

p of Ka nsas, Inc.

,

305 Kan. 761, 769, 388 P.3d 84 (2017).

Waiver and equitable estoppel are not appropriately invoked here. Yarbro's

counsel sent a letter requesting that the insurance adjusters open a file for underinsured

motorist benefits in this case. The l etter correctly noted that Kansas law required any

policy of motor vehicle liability insurance to include underinsured motorist coverage with

limits equal to the liability limits. See K.S.A. 40

- 284(b). The insurance adjuster

responded that FirstGroup had c hosen "uninsured" motorist coverage equal to the Kansas15

minimum limits and instructed Yarbro's attorney to advise him "[s]hould you believe

your client is entitled to underinsured benefits." The adjuster advised the attorney to

contact him if more informat ion was needed. The letter in part read:

"I am the adjuster assigned to handle your inquiry of the potential underinsured motorist

claim for Rodger Yarbro the First Student driver. For your record I have attached a copy

of the First Groups declaration pag e and the Kansas Uninsured Motorists coverage in

effect at the time of this accident, effective dates of 12/31/10 to 12/31/11. The selection

that is chosen for uninsured motorist coverage is limited equal to Kansas minimum

required limits which would be eq ual or less th [a] n the Tortfeasors policy limits. Should

you have any further questions or require any addition [al] information please contact me.

"Should you believe your client is entitled to underinsured benefits please advise me

accordingly. Provide me with a current update in regards to your client's diagnoses and

prognoses of injuries so we may update our file. Have the attached HIPAA medical

a uthorization form completed and return along with the names addresses and phone

numbers of the medical providers who are treating your client for any injuries resulting

from this accident."

A copy of the signed rejection form was included with this lette r.

The letter does not show National Union intended to give up its right to notice of a

tentative settlement. Rather, the insurance adjuster asked Yarbro's attorney to

• k eep him updated about Yarbro's diagnoses and prognoses of injuries ;

• complete a HIPAA auth orization ;

• provide contact information for Yarbro's medical providers ;

• provide copies of medical bills ; and

• notify him if Yarbro still believed he was entitled to underinsured motorist

benefits.16

It does not appear that National Union was ready to close its file on the case. Rather, the

insurance adjuster was ready to open the file as Yarbro had requested. This letter is not

inconsistent with National Union's right to notice of a tentative settlement. The insurance

adjuster wanted more information on the claim. And assuming the insurance adjuster did

deny coverage of underinsured benefits, Yarbro did not have to rely on that statement.

The rejection form was included in the correspondence and did not mention underinsured

motorist coverage. Yarbro could ha ve sent notice of a tentative settlement to National

Union but failed to do so. Under Dalke , Yarbro forfeited his right to underinsured

motorist benefits.

We summarize our holdings.

On the appeal, w e set aside the district court's grant of summary judgment to

National Union where the court found that FirstGroup had rejected in writing excess

underinsured coverage as required by K.S.A. 40

- 284(c).

On the cross

- appeal, w e reverse the ruling of the distr ict court denying summary

judgment to National Union

.

We remand this case to the district court with directions to enter summary

judgment in favor of National Union because Yarbro failed to notify the insurance carrier

of the tentative settlement he had reached with Hernandez.

Reversed and remanded with directions.