Title: State Farm Mutual Automobile Insurance Company v. Nancy G. Langridge
Citation: 2004 WI 113
Docket Number: 2002AP003353-FT
State: Wisconsin
Issuer: Wisconsin Supreme Court
Date: July 13, 2004

2004 WI 113 
 
 
 
SUPREME COURT OF WISCONSIN 
 
 
 
 
 
CASE NO.: 
02-3353-FT 
COMPLETE TITLE: 
 
 
State Farm Mutual Automobile Insurance Company,  
          Plaintiff-Respondent, 
 
     v. 
 
Nancy G. Langridge,  
          Defendant-Appellant-Petitioner. 
 
 
 
REVIEW OF A DECISION OF THE COURT OF APPEALS 
(no cite) 
 
 
OPINION FILED: 
July 13, 2004 
SUBMITTED ON BRIEFS: 
        
ORAL ARGUMENT: 
February 12, 2004   
 
 
SOURCE OF APPEAL: 
 
 
COURT: 
Circuit   
 
COUNTY: 
Racine   
 
JUDGE: 
Charles H. Constantine   
 
 
 
JUSTICES: 
 
 
CONCURRED: 
        
 
DISSENTED: 
BRADLEY, J., dissents (opinion filed). 
ABRAHAMSON, C.J., joins dissent.   
 
NOT PARTICIPATING: SYKES, J., did not participate.   
 
 
 
ATTORNEYS: 
 
For the defendant-appellant-petitioner there were briefs by 
Thomas M. Devine, JoAnne M. Breese-Jaeck, Christopher A. Geary 
and Hostak, Henzl & Bichler, S.C., Racine, and oral argument by 
Thomas M. Devine. 
 
For the plaintiff-respondent there was a brief by Russell 
M. Ware, Kenneth E. Rusch and O’Hagan, Smith & Amundsen, LLC, 
Milwaukee and Michael Resis and O’Hagan, Smith & Amundsen, LLC, 
Chicago, and oral argument by Michael Resis. 
 
 
2004 WI 113 
NOTICE 
This opinion is subject to further 
editing and modification.  The final 
version will appear in the bound 
volume of the official reports.   
No.  02-3353-FT   
(L.C. No. 
02 CV 1133) 
STATE OF WISCONSIN  
 
 
   : 
IN SUPREME COURT 
 
 
State Farm Mutual Automobile Insurance  
Company,  
 
          Plaintiff-Respondent, 
 
     v. 
 
Nancy G. Langridge,  
 
          Defendant-Appellant-Petitioner. 
 
FILED 
 
JUL 13, 2004 
 
Cornelia G. Clark 
Clerk of Supreme Court 
 
 
 
 
 
REVIEW of a decision of the Court of Appeals.  Affirmed.   
 
¶1 
DAVID T. PROSSER, J.   This case requires the court to 
determine underinsured motor vehicle (UIM) coverage in an 
automobile insurance policy.  Nancy Langridge, an insured under 
the policy, seeks review of an unpublished decision of the court 
of appeals1 affirming the circuit court's decision to grant 
summary judgment to the insurer.  For the reasons explained 
below, we affirm.   
                                                 
1 State Farm Mut. Auto. Ins. Co. v. Langridge, No. 02-3353-
FT, unpublished order (Wis. Ct. App. June 4, 2003). 
No. 02-3353-FT 
 
2 
 
 
FACTS AND PROCEDURAL HISTORY 
 
¶2 
On June 19, 2000, William Langridge died in a traffic 
accident caused by a drunk driver.  Langridge was the lone rider 
on a motorcycle that was covered under an automobile insurance 
policy that he and his wife Nancy had purchased from State Farm 
Mutual Automobile Insurance Company (State Farm).  Both Mr. and 
Mrs. Langridge were named insureds.  The State Farm policy 
included UIM coverage with limits of $100,000 per person and 
$300,000 per accident. 
 
¶3 
The drunk driver had liability coverage under a policy 
issued by Liberty Mutual Insurance Company.  The drunk driver's 
policy had liability limits of $150,000.  Following Mr. 
Langridge's death, Nancy Langridge——who was not present when the 
accident occurred——settled with Liberty Mutual for $150,000, 
while acting as representative of her husband's estate. 
 
¶4 
On June 7, 2001, Mrs. Langridge filed her own claim 
with State Farm for the $100,000 UIM coverage.  State Farm 
denied her claim, explaining that she was not involved in the 
accident giving rise to the claim and had sustained no bodily 
injury; therefore, she was not entitled to coverage. 
¶5 
On April 25, 2002, State Farm initiated the present 
action, seeking a declaration that Mrs. Langridge is not 
entitled 
to 
recovery 
under 
the 
policy. 
 
Mrs. 
Langridge 
counterclaimed, alleging that she was covered by the UIM feature 
No. 02-3353-FT 
 
3 
 
of the policy.2  Before the counterclaim was filed, an arbitrator 
valued Mrs. Langridge's claim at $850,000.  This dollar value 
consisted of $350,000 for the statutory cap on wrongful death 
damages for loss of society and companionship and $500,000 to 
compensate for pecuniary loss resulting from her husband's 
death. 
¶6 
The parties traded motions for summary judgment.  The 
Racine County Circuit Court, Charles H. Constantine, Judge, 
denied Mrs. Langridge's motion and awarded summary judgment to 
State Farm, concluding that Mrs. Langridge could not make her 
own claim under the policy because "the insured attempting to 
claim underinsured motorist coverage must have suffered a bodily 
injury."  Under the facts presented, the court said William 
Langridge was the only insured to suffer a bodily injury: 
The insured suffering bodily injury (Mr. Langridge) in 
this case is not entitled to collect underinsured 
motorist coverage.  The derivative claims would be 
compensable if there were a viable claim for bodily 
injury . . .  As Mrs. Langridge did not [have bodily 
injury], there is no coverage. 
¶7 
Nancy Langridge appealed.  The court of appeals 
affirmed the circuit court's judgment in favor of State Farm.  
According to the court of appeals,  
William Langridge suffered the bodily injury.  [Mrs.] 
Langridge, therefore, recovers only as the survivor of 
her husband's claim.  In other words, for the purposes 
of this insurance policy, her claim derives from her 
husband's claim for bodily injury. . . .  
                                                 
2 Langridge also alleged that State Farm acted in bad faith 
by denying coverage. 
No. 02-3353-FT 
 
4 
 
Langridge argues that a wrongful death action is 
not a derivative action but is her own independent 
action.  This is true in the sense that she may bring 
an independent cause of action for wrongful death.  
But we are not deciding whether a wrongful death 
action is an independent action.  We are construing an 
insurance policy which provides that she must have 
sustained a bodily injury herself.  In this sense, her 
action is derivative because under the policy, only 
those who have suffered bodily injury may recover.  
She has not, and consequently, is not entitled to 
recover. 
We subsequently accepted Mrs. Langridge's petition for review. 
APPLICABLE POLICY PROVISIONS 
 
¶8 
The Langridge policy contains the following relevant 
provisions, some of which are defined terms that are used 
throughout the policy and which appear in bold face italics: 
Bodily Injury——means bodily injury to a person and 
sickness, disease or death which results from it. 
Insured——means the person, persons or organization 
defined as insureds in the specific coverage. 
Person——means a human being. 
. . . .  
UNDERINSURED MOTOR VEHICLE——COVERAGE W 
You 
have 
this 
coverage 
if 
"W" 
appears 
in 
the 
"Coverages" space on the declarations page. 
We will pay damages for bodily injury an insured is 
legally entitled to collect from the owner or driver 
of an underinsured motor vehicle.  The bodily injury 
must be caused by accident arising out of the 
operation, maintenance or use of an underinsured motor 
vehicle. 
. . . .  
Underinsured 
Motor 
Vehicle——means 
a 
land 
motor 
vehicle. 
No. 02-3353-FT 
 
5 
 
1. 
the ownership, maintenance or use of which is 
insured or bonded for bodily injury liability at 
the time of the accident; and 
2. 
whose limits of liability for bodily injury 
liability: 
a. 
are less than the limits of liability of 
this coverage; or 
b. 
have been reduced by payments to persons 
other than the insured to less than the 
limits of liability of this coverage. 
. . . .  
Limits of Liability 
Coverage W 
1. 
The 
amount 
of 
coverage 
is 
shown 
on 
the 
declarations page under "Limits of Liability-W-
Each Person, Each Accident".  Under "Each Person" 
is the amount of coverage for all damages due to 
bodily injury to one person.  "Bodily injury to 
one person" includes all injury and damages to 
others resulting from this bodily injury.  Under 
"Each Accident" is the total amount of coverage, 
subject to the amount shown under "Each Person", 
for all damages due to bodily injury to two or 
more persons in the same accident. 
¶9 
As noted above, the UIM limit in the Langridge policy 
for "Each Person" was $100,000.  The UIM limit for "Each 
Accident" was $300,000.  With these provisions at hand, we 
summarize each party's interpretation of the provisions as they 
apply to the facts underlying the claim. 
¶10 Nancy Langridge asserts that her policy defines an 
"underinsured motor vehicle" to include a vehicle owned by an 
insured driver whose limits of liability for bodily injury 
[$150,000] "b. have been reduced by payments to persons [William 
No. 02-3353-FT 
 
6 
 
Langridge] other than the insured [Nancy Langridge] to less than 
the limits of the coverage."  She argues that because she is a 
named insured under the policy, and the drunk driver's liability 
limits were paid to persons other than her, the insured drunk 
driver was underinsured as to her.  Therefore, she asserts, she 
should be able to claim coverage under her policy for her 
wrongful death claim. 
¶11 State Farm counters that Mrs. Langridge is attempting 
to split the claim for her husband's bodily injury into two 
claims to gain access to coverage to which she is not entitled.  
It asserts that since the drunk driver was not underinsured as 
to William Langridge and since Mrs. Langridge's claim under the 
policy is derivative of her husband's claim, the drunk driver 
was not underinsured.  State Farm's position is that, based upon 
the context of the whole policy, the only relevant question to 
ask is whether the drunk driver was underinsured as to William 
Langridge.  In its view, the answer is "no," and consequently 
there was no "underinsured motor vehicle" and no UIM coverage.   
STANDARDS OF REVIEW 
¶12 In this case, the circuit court granted State Farm's 
motion for summary judgment.  When we review a grant of summary 
judgment, our review is de novo.  Mullen v. Walczak, 2003 WI 75, 
¶11, 262 Wis. 2d 708, 664 N.W.2d 76 (citing Ahrens v. Town of 
Fulton, 2002 WI 29, ¶15, 251 Wis. 2d 135, 641 N.W.2d 423)); 
Smith v. Katz, 226 Wis. 2d 798, 805, 595 N.W.2d 345 (1999) 
(citing Burkes v. Klauser, 185 Wis. 2d 308, 327, 517 N.W.2d 503 
(1994)).  We rely upon the standard that summary judgment is 
No. 02-3353-FT 
 
7 
 
granted when there is no genuine issue of material fact, and the 
moving party is entitled to judgment as a matter of law.  
Mullen, 2003 WI 75, ¶11; Smith, 226 Wis. 2d at 805; see also 
Taylor v. Greatway Ins. Co., 2001 WI 93, ¶9, 245 Wis. 2d 134, 
628 N.W.2d 916.  This is the same standard used by the circuit 
court and the court of appeals, and accordingly, we benefit 
from, but need not give deference to, the analyses of both 
courts.  Taylor, 245 Wis. 2d 134, ¶9.   
¶13 This case requires the court to interpret the terms of 
an insurance policy.  The interpretation of an insurance policy 
is a question of law and is also reviewed de novo.  Folkman v. 
Quamme, 2003 WI 116, ¶12, 264 Wis. 2d 617, 665 N.W.2d 857 
(citing Danbeck v. Am. Fam. Mut. Ins. Co., 2001 WI 91, ¶10, 245 
Wis. 2d 186, 629 N.W.2d 150); Mullen, 262 Wis. 2d 708, ¶12 
(citing same).  We construe insurance policies to give effect to 
the intent of the parties.  Folkman, 264 Wis. 2d 617, ¶16 
(citing Sprangers v. Greatway Ins. Co., 182 Wis. 2d 521, 536, 
514 N.W.2d 1 (1994)); Mullen, 262 Wis. 2d 708, ¶12.   
¶14 To do so, we give the words in the insurance policy 
their common and ordinary meaning, that is, the meaning a 
reasonable person in the position of the insured would have 
understood the words to mean.  Folkman, 264 Wis. 2d 617, ¶17 
(citing Arnold P. Anderson, Wisconsin Insurance Law § 1.1(C) 
(4th ed. 1998)); State Farm Mut. Auto. Ins. Co. v. Gillette, 
2002 WI 31, ¶28, 251 Wis. 2d 561, 641 N.W.2d 662 (citing 
Danbeck, 245 Wis. 2d 186, ¶10; Maas v. Ziegler, 172 Wis. 2d 70, 
81-82, 
492 
N.W.2d 621 
(1992); 
Garriguenc 
v. 
Love, 
67 
No. 02-3353-FT 
 
8 
 
Wis. 2d 130, 134-35, 226 N.W.2d 414 (1975); Henderson v. State 
Farm Mut. Auto. Ins. Co., 59 Wis. 2d 451, 459, 208 N.W.2d 423 
(1973)).   
¶15 If a policy is ambiguous as to coverage, it will be 
construed in favor of the insured.  Folkman, 264 Wis. 2d 617, 
¶16; Gillette, 251 Wis. 2d 561, ¶28.  Thus, the first task in 
construing an insurance policy is to determine whether there is 
ambiguity with respect to the disputed coverage.  Badger Mut. 
Ins. Co. v. Schmitz, 2002 WI 98, ¶51, 255 Wis. 2d 61, 647 
N.W.2d 223.  Language in an insurance policy is ambiguous "if it 
is susceptible to more than one reasonable interpretation."  
Folkman, 264 Wis. 2d 617, ¶13 (emphasis added); see also Taylor, 
245 Wis. 2d 134, ¶10.  Courts will interpret the words of an 
insurance contract against the insured when the insurer's 
interpretation conforms to what a reasonable person in the 
position of the insured would have understood the words to mean.  
Folkman, 264 Wis. 2d 617, ¶20 (citing McPhee v. Am. Motorists 
Ins. Co., 57 Wis. 2d 669, 676, 205 N.W.2d 152 (1973)).  We will 
not interpret a policy "to provide coverage for risks that the 
insurer did not contemplate or underwrite and for which it has 
not received a premium."  Am. Fam. Mut. Ins. Co. v. Am. Girl, 
Inc., 2004 WI 2, ¶23, 268 Wis. 2d 16, 673 N.W.2d 65.   
ANALYSIS 
A. 
Overview of UIM Coverage and "Underinsured Motor Vehicle" 
¶16 In Schmitz, we noted two schools of thought concerning 
UIM coverage.  255 Wis. 2d 61, ¶17.  Under the first view, UIM 
coverage operates as a separate fund to "compensate an insured 
No. 02-3353-FT 
 
9 
 
accident victim when the insured's damages exceed the recovery 
from the at-fault driver (or other responsible party)."  Id. 
(citing Taylor, 245 Wis. 2d 134, ¶32 (Bradley, J., dissenting); 
Kaun v. Indus. Fire & Cas., 148 Wis. 2d 662, 671, 436 N.W.2d 321 
(1989)).  If the policy at issue in this case were written to 
reflect this view, the Langridges' $100,000 per person UIM 
coverage would be available to compensate Nancy Langridge for a 
claim linked to her husband's wrongful death. 
¶17 Under the second view, UIM coverage is designed "to 
put the insured in the same position as he [or she] would have 
occupied had the tortfeasor's liability limits been the same as 
the underinsured motorist limits purchased by the insured."  
Schmitz, 255 Wis. 2d 61, ¶18 (quoting Dowhower v. W. Bend Mut. 
Ins. Co., 2000 WI 73, ¶18, 236 Wis. 2d 113, 613 N.W.2d 557).  If 
the UIM policy at issue were drafted to conform to this view, 
the 
UIM 
coverage 
and 
the 
tortfeasor's 
liability 
policy 
conjunctively would offer a "predetermined, fixed level of 
insurance coverage" made up of payments from both policies.  Id. 
(citing 
Kaun, 
148 
Wis. 2d at 
674-75 
(Steinmetz, 
J., 
dissenting)).  
¶18 In recent 
years, 
the legislature 
has 
authorized 
policies embodying the latter view, and courts have recognized 
the legitimacy of these policies.  Dowhower, 236 Wis. 2d 113, 
¶33; Taylor, 245 Wis. 2d 134, ¶25; Schmitz, 255 Wis. 2d 61, ¶73.  
Yet, insurers need not draft, and consumers need not purchase, 
automobile insurance policies with this type of coverage.  An 
insurer could offer coverage that embodies the first view of UIM 
No. 02-3353-FT 
 
10 
 
insurance, and that insurer could and would charge a higher 
premium to account for the likelihood of larger and more 
frequent payments to insureds.   
¶19 Defined terms play a large role in bounding the scope 
of a policy's coverage.  Insurers may define "underinsured motor 
vehicle" to reflect either the first or second view of UIM 
coverage.  As one treatise notes, "[p]olicies vary in their 
definitions of an underinsured motor vehicle.  The most crucial 
difference 
is 
whether 
the 
definition 
is 
based 
on 
the 
underinsured motorist motor vehicle policy limits or on the 
damages sustained by the insured."  Arnold P. Anderson, 
Wisconsin Insurance Law, § 4.3(A) (4th ed. 1998).  This 
difference is crucial because it significantly impacts the 
expectations of insureds. 
¶20 When a UIM policy defines "underinsured motor vehicle" 
by comparing the insured's damages to the tortfeasor's liability 
coverage, an insured would expect the policy to conform to the 
first view of UIM coverage.  That is, since the policy considers 
a vehicle 
"under"-insured 
when the 
tortfeasor's liability 
coverage is inadequate to fully compensate the insured, the 
insured could reasonably expect that the entire available limit 
of the policy would be available to cover part or all of the 
difference between the tortfeasor's liability limits and the 
insured's damages.   
¶21 However, when a UIM policy defines an "underinsured 
motor vehicle" by comparing the tortfeasor's limits of liability 
to the insured's limits of UIM coverage, the insured ought 
No. 02-3353-FT 
 
11 
 
reasonably to expect that the second, more common, view of UIM 
coverage is in effect.  Specifically, an insured who reads the 
second definition in a policy ought reasonably to expect that 
the insurer promises only to insure for the difference between 
the insured's higher UIM limit and the tortfeasor's lower 
liability limit.  An insured who enters into the second kind of 
UIM policy should not reasonably expect the policy to operate 
under the first view of UIM coverage. 
B. 
The Issue of "Bodily Injury" 
¶22 The issue in this case is whether Nancy Langridge is 
entitled to the UIM coverage of State Farm's policy for her 
husband's death.  Both lower courts concluded that she was not, 
and both based their decision in part on the rationale that 
Nancy Langridge must have suffered her own bodily injury to 
qualify for coverage.   
¶23 This is not completely accurate.  Nancy Langridge 
notes that the policy language does not include a prerequisite 
that an insured must have suffered bodily injury to recover.  
State Farm concedes as much in its brief: 
The 
defendant 
is 
correct 
to 
state 
in 
her 
brief . . . that . . . she 
is 
legally 
entitled 
to 
collect damages for her husband's death . . . .  
The defendant refers to a passage of the decision 
of the court of appeals in which [the court] observed 
that "under the policy, only those who have suffered 
bodily injury may recover."  This language . . . is an 
overstatement . . . .  This language would be correct 
if it is amended so that the "bodily injury" must be 
caused by an "underinsured motor vehicle" as the 
policy requires. 
No. 02-3353-FT 
 
12 
 
¶24 The Langridges' policy had $100,000 per person UIM 
coverage.  The drunk driver had $150,000 policy limits.  If the 
drunk driver had had only $50,000 policy limits, Mrs. Langridge 
would have had a derivative claim for the $50,000 difference 
between the tortfeasor's policy limit and her $100,000 per 
person UIM coverage.  If the Langridges' policy had had $300,000 
per person UIM coverage, Mrs. Langridge would have had a 
derivative claim for the $150,000 difference between the 
tortfeasor's $150,000 policy limit and her $300,000 per person 
UIM coverage.  Parenthetically, if the drunk driver had had no 
insurance at all, Mrs. Langridge would have had a derivative 
claim for the $100,000 uninsured motorist coverage of her 
policy.  In each of these instances, Mrs. Langridge did not have 
to suffer bodily injury herself in order to recover. 
¶25 While State Farm concedes that Nancy Langridge need 
not have suffered a bodily injury to recover under every fact 
situation, it nonetheless asserts that she is not entitled to 
coverage in this fact situation, because she does not have a 
claim under the policy independent of her husband's bodily 
injury; she has only a derivative claim.  State Farm's position 
is that the drunk driver's vehicle does not meet the definition 
of an "underinsured motor vehicle" as to William Langridge; 
consequently, it cannot meet the definition of an "underinsured 
motor vehicle" as to Mrs. Langridge because her claim derives 
from her husband's bodily injury.  As a result, her claim falls 
outside the coverage provision of the policy. 
No. 02-3353-FT 
 
13 
 
   
C. 
The Issue of "Underinsured Motor Vehicle" 
¶26 To state the obvious, underinsured motor vehicle 
coverage requires an "underinsured motor vehicle."  Nancy 
Langridge argues that the drunk driver's vehicle meets the 
policy's "underinsured motor vehicle" definition as to her.  Her 
reasoning is as follows.   
¶27 First, 
Mrs. 
Langridge 
asserts 
that 
she 
is 
"an 
insured."  The policy's coverage provision provides: "We will 
pay damages for bodily injury an insured is legally entitled to 
collect from the owner or driver of an underinsured motor 
vehicle.  The bodily injury must be caused by accident arising 
out of the operation, maintenance or use of an underinsured 
motor vehicle."  Nancy Langridge contends that she is "an 
insured" who is legally entitled to collect wrongful death 
damages from the drunk driver for the death of her husband.  She 
supports her position by referencing the policy's definition of 
bodily injury, which "means bodily injury to a person and 
sickness, disease or death which results from it."  (Emphasis 
added).  According to Mrs. Langridge, her wrongful death claim 
meets the requirements of the "for bodily injury" clause of the 
coverage language because it is for the death of her husband 
which resulted from his bodily injury.  State Farm does not 
dispute this reasoning.  It is this reasoning that opens the 
door to a derivative claim. 
¶28 Second, Mrs. Langridge asserts that the vehicle driven 
by the drunk driver meets the policy's definition of an 
No. 02-3353-FT 
 
14 
 
"underinsured motor vehicle."  She relies on paragraph "b" of 
the "underinsured motor vehicle" definition: 
Underinsured 
Motor 
Vehicle——means 
a 
land 
motor 
vehicle. 
1. 
the ownership, maintenance or use of which is 
insured or bonded for bodily injury liability at 
the time of the accident; and 
2. 
whose limits of liability for bodily injury: 
a. 
are less than the limits of liability of 
this coverage; or 
b. 
have been reduced by payments to persons 
other than the insured to less than the 
limits 
of 
liability 
of 
this 
coverage.  
(Emphasis added). 
¶29 Mrs. Langridge asserts that paragraph "b" renders the 
drunk driver's vehicle "underinsured" as to her.  As she reads 
paragraph "b," she is "the insured."  The drunk driver's 
$150,000 limits of liability have been reduced by payments to 
her husband, not to her, and therefore these payments have 
rendered the drunk driver's vehicle "underinsured" as to her.   
¶30 State Farm reads the policy differently.  Under the 
policy, a motor vehicle can be considered underinsured in either 
of two ways.  First, paragraph "a" in the definition of 
"underinsured motor vehicle" speaks of a vehicle whose limits of 
liability "a. are less than the limits of liability of this 
coverage." 
¶31 In this instance, the drunk driver purchased $50,000 
more in liability coverage than the Langridges bought in UIM 
No. 02-3353-FT 
 
15 
 
coverage.  There is no dispute that the drunk driver's vehicle 
was not underinsured as to William Langridge.   
¶32 State Farm emphasizes that Nancy Langridge's wrongful 
death claim for the death of her husband arises out of her 
husband's bodily injury and not her own, and therefore her claim 
is derivative.  To underscore this point, State Farm relies on 
the limits of liability section of the policy.  Under the 
"Limits of Liability" section, "Bodily injury to one person 
includes all injury and damages to others resulting from this 
bodily injury."3 (Emphasis added).  State Farm asks that we read 
this provision in conjunction with Gocha v. Shimon, 215 
Wis. 2d 586, 573 N.W.2d 218 (Ct. App. 1997), and Richie v. 
American Family Mutual Insurance Company, 140 Wis. 2d 51, 409 
N.W.2d 146 (Ct. App. 1987).   
¶33 Both Gocha and Richie involved fact situations in 
which insureds were not entitled to collect the greater "per 
accident" limit; they were confined to the smaller "per person" 
limit because there was only one insured who suffered a bodily 
injury.  These cases distinguish between independent claims and 
derivative claims.  Both conclude that when an insured seeks 
payment arising out of the bodily injury of another, the 
                                                 
3 This provision is similar to the clause American Family 
Mutual Insurance Company relied on in Mullen v. Walczak, 2003 WI 
75, ¶4, 262 Wis. 2d 708, 664 N.W.2d 76.  Their "limits of 
liability" for uninsured motorist coverage provided that the 
"limit for 'each person' is the maximum for all damages 
sustained by all persons as the result of bodily injury to one 
person in any one accident." 
No. 02-3353-FT 
 
16 
 
insured's claims are "derivative" of the claim of the person 
suffering the bodily injury,4 and as a result only the "per 
person" limit is available for each person suffering bodily 
injury. 
¶34 Turning to paragraph "b," State Farm explains that 
paragraph "b" is designed to address situations in which 
multiple parties suffer bodily injury in one accident, and the 
tortfeasor's automobile liability insurance is exhausted by 
payments to a person or persons other than the State Farm 
policy's "insured" claimant.  These other persons might be in 
other vehicles, or they might be in the same vehicle as the 
insured.  Payments from the tortfeasor's policy for bodily 
injury to other persons can reduce the tortfeasor's liability 
limits that are available to the insured.   
¶35 Typically, if a policy defines "underinsured motor 
vehicle" as it did here——by comparing the tortfeasor's liability 
limits to the limits of UIM coverage——then "payment to other 
injured parties that reduces the coverage available to an 
insured below UIM limits will usually not trigger UIM coverage."  
Anderson, supra, § 4.3(E) (emphasis added).  Thus, paragraph "b" 
goes beyond typical coverage to provide coverage for an insured 
when a tortfeasor becomes functionally underinsured by virtue of 
payments to others, in that the tortfeasor's remaining coverage 
                                                 
4 This principle was reaffirmed last term under different 
circumstances in Mullen, 262 Wis. 2d 708. 
No. 02-3353-FT 
 
17 
 
to compensate the insured is less than the insured's own UIM 
limits. 
¶36 This concept meshes with language in the "Limits of 
Liability" section: 
The 
amount 
of 
coverage 
is 
shown 
on 
the 
declarations page under "Limits of Liability——W——
Each Person, Each Accident". . . .  Under "Each 
Accident" 
is the 
total 
amount of 
coverage, 
subject to the amount shown under "Each Person", 
for all damages due to bodily injury to two or 
more persons in the same accident.  (Emphasis 
added). 
D. 
Interpreting the Policy 
 
1. 
Identifying "the Insured" in Paragraph "b" 
¶37 In our view, the outcome of this case turns on whether 
"the insured" in paragraph "b" could reasonably refer to Nancy 
Langridge.  We conclude that it is not reasonable to read the 
policy in this fashion.  As a result, the policy is not 
ambiguous and should not be construed in favor of the insured. 
¶38 We observe, first, that if paragraph "b" referred to a 
motor vehicle whose limits of liability for bodily injury 
liability "have been reduced by payments to persons other than 
AN insured," instead of "THE insured," there would be no issue, 
because "AN insured" would include William Langridge.  In fact, 
some policies do use "an insured" in a similar context.5  Yet, 
there would be situations in which use of the phrase "an 
                                                 
5 See, e.g., State Farm Mut. Auto. Ins. Co. v. Villicana, 
692 N.E.2d 1196, 1198 (Ill. 1998); Kraly v. Vannewkirk, 635 
N.E.2d 323, 325 (Ohio 1994); Pitchford v. State Farm Mut. Auto. 
Ins. Co., 934 P.2d 616, 618 (Or. Ct. App. 1997). 
No. 02-3353-FT 
 
18 
 
insured" would limit payment to surviving "insureds" who had 
actually suffered bodily injury, and that result would conflict 
with the reasonable expectations of the insured.6 
¶39 We observe, second, that if Mrs. Langridge were not a 
named insured, she could make a claim representing the estate 
under paragraph "a" in a situation where her husband's policy 
limits made him eligible for UIM coverage.  As a named insured, 
she could make a claim under paragraph "a" in a situation where 
her husband's policy limits made him eligible for UIM coverage.  
In both situations, the drunk driver's vehicle would be an 
"underinsured motor vehicle."  Instead, Mrs. Langridge seeks to 
collect under paragraph "b" because her husband's policy limits 
did not make him eligible for underinsured motorist coverage. 
¶40 We are required to ask how an insured who cannot 
succeed under paragraph "a" with a traditional derivative claim 
can expect to succeed under paragraph "b" with an independent 
claim when the insured claimant has not suffered bodily injury 
herself and when she is wholly dependent in her claim upon the 
bodily injury of another.  How can she expect an interpretation 
                                                 
6 Contrary to the dissent's assertion that ¶¶38-40 of this 
opinion constitutes our "essential analysis," we note that these 
paragraphs simply serve to focus the discussion within the 
appropriate analytical framework.  Given the complex nature of 
UIM cases, guiding the reader through the intricacies of UIM 
coverage facilitates reader understanding.  We direct the reader 
to Section D.2 of this opinion, especially ¶¶51-55, wherein we 
explain why Nancy Langridge's interpretation of the definition 
of "Underinsured Motor Vehicle" is unreasonable, therefore 
rendering the policy unambiguous with respect to the issues 
presented in this case.  
No. 02-3353-FT 
 
19 
 
of the policy that an insured who suffers no bodily injury has 
an independent claim equal to the claim of a surviving insured 
who actually suffers bodily injury? 
2. 
The Relationship Between Ambiguity and the Reasonable 
Expectations of the Insured 
¶41 Our first task when interpreting an insurance policy 
is to determine whether the policy is ambiguous.  It is 
important to recognize that simply because the parties offer two 
different interpretations of paragraph "b" does not mean both 
interpretations are reasonable.  See Ruff v. Graziano, 220 
Wis. 2d 513, 524, 583 N.W.2d 185 (Ct. App. 1998) (citing 
Sprangers v. Greatway Ins. Co., 182 Wis. 2d 521, 537, 514 
N.W.2d 1 (1994)).  "The mere fact that a word has more than one 
dictionary meaning, or that the parties disagree about the 
meaning, does not necessarily make the word ambiguous if the 
court concludes that only one meaning applies in the context and 
comports with the parties' objectively reasonable expectations."  
Id. (quoting Sprangers, 182 Wis. 2d at 537) (emphasis added).   
¶42 Judicial construction of insurance policies is both 
similar 
to 
and 
different 
from 
judicial 
construction 
of 
contracts. 
 In general, 
"[w]e apply 
the 
same 
rules of 
construction to the language in insurance policies as to the 
language in any other contract."  Taylor, 245 Wis. 2d 134, ¶10 
(citing Kremers-Urban Co. v. Am. Employers Ins. Co., 119 
Wis. 2d 722, 735, 351 N.W.2d 156 (1984)).  In both arenas, our 
goal is to give effect to the intent of the parties.  Folkman, 
264 Wis. 2d 617, ¶16.   
No. 02-3353-FT 
 
20 
 
¶43 Setting 
to 
one 
side 
the 
specific 
interpretive 
principles that apply to insurance policies, we note that courts 
have several means to address ambiguous contract language.  For 
instance, a court faced with an ambiguous contract will "select 
that construction which gives effect to each word or provision 
of the contract in preference to a construction which results in 
surplusage."  Jones v. Jenkins, 88 Wis. 2d 712, 722, 277 
N.W.2d 815 (1979).  The court will also adopt a construction 
that "will result in a reasonable, fair and just contract as 
opposed to one that is unusual or extraordinary."  Id.  Often 
the court will "look to the purpose of the contract and the 
circumstances 
surrounding 
its 
execution 
to 
determine 
the 
intent."  Id. at 723.   
¶44 These principles are buttressed by the judicial maxim 
that "[a]mbiguous wording will be construed against the drafter 
provided the contract is also construed as a whole."  Id. at 722 
(emphasis added).  This principle, which in the archaic parlance 
of the common law was known as contra proferentem ("against the 
offeror"), may be the transcendent principle for resolving 
ambiguous language in insurance policies.  If an insurance 
policy is ambiguous, then the policy is to be interpreted 
against the drafter.  See Donaldson v. Urban Land Interests, 
Inc., 211 Wis. 2d 224, 230, 564 N.W.2d 728 (1997).  
¶45 A court that reviews a contract that is not an 
insurance policy has some latitude to deem an interpretation 
plausible 
and 
therefore 
reasonable 
because 
the 
court 
is 
specifically empowered to consider the consequences of the 
No. 02-3353-FT 
 
21 
 
interpretation in determining which competing interpretation 
should govern.  As this court once put it: 
the court may look to the consequences which could 
result should it adopt one construction as opposed to 
another, because where there is ambiguity the more 
reasonable meaning should be given on the probability 
that persons situated as the parties were would be 
expected to contract in that way as opposed to a way 
which works an unreasonable result. 
Lee v. Wis. Physicians Serv., 76 Wis. 2d 353, 359, 252 N.W.2d 24 
(1977).   
¶46 If a court deems an insurance policy ambiguous, 
however, the court is quite constrained in its resolution under 
the principles of contra proferentem.  This cannot and does not 
mean, however, that a court must embrace any grammatically 
plausible interpretation that an insured might create for the 
purposes 
of 
litigation 
without 
regard 
to 
whether 
the 
consequences of that interpretation square with the reasonable 
expectations of insureds.   
¶47 A court must be careful not to lose sight of the goal 
of judicial construction, which is to advance the reasonable 
expectations of the parties.  Courts dealing with insurance 
policies must give especially keen attention to the expectations 
of insureds, so long as they do not abandon reasonableness in 
the 
process. 
 
Even 
the 
doctrine 
of 
contra 
proferentem 
incorporates the notion that "the policy's terms should be 
interpreted as they would be understood from the perspective of 
a reasonable person in the position of the insured," Donaldson, 
No. 02-3353-FT 
 
22 
 
211 Wis. 2d at 230, not simply adhere to any interpretation that 
is grammatically plausible and creates coverage for insureds.   
¶48 If an insured advances a grammatically plausible 
interpretation, but that interpretation does not square with 
what the insured would have understood the policy to mean absent 
a monetary incentive, then that reading should be rejected as 
unreasonable.  The tenets of insurance policy construction 
provide that there is ambiguity where a policy is susceptible to 
more 
than 
one 
reasonable 
interpretation. 
 
Folkman, 
264 
Wis. 2d 617, ¶13; Danbeck, 245 Wis. 2d 186, ¶10. 
¶49 We look then at the reasonable expectations of the 
insured here.  The primary definition of "underinsured motor 
vehicle" in this policy conveys to the insured that this policy 
follows the second view of UIM coverage.  This policy is not the 
type that defines "underinsured motor vehicle" by comparing the 
insured's total damages to the tortfeasor's limits of liability.  
When, as here, a UIM policy defines "underinsured motor vehicle" 
with reference to the tortfeasor's limits of liability and the 
limits of UIM coverage, a reasonable insured should expect that 
UIM coverage to put the insured in the same position the insured 
would have occupied had the tortfeasor's liability limits been 
the same as the UIM limits.   
¶50 In this instance, the drunk driver purchased $50,000 
more in liability coverage than the Langridges purchased in UIM 
coverage.  Thus, Nancy Langridge skips over paragraph "a" to 
paragraph "b."  Reasonable insureds should expect paragraph "b" 
to apply where multiple parties suffered bodily injury in the 
No. 02-3353-FT 
 
23 
 
accident and the tortfeasor's limits of liability have been 
reduced or exhausted in payment to others suffering bodily 
injury.   
¶51 In this case, an insured who suffered no bodily injury 
seeks to recover for her spouse's wrongful death after the 
tortfeasor's "limits of liability for bodily injury" had been 
fully paid.  If we were to accept Nancy Langridge's reading of 
the policy, then every time a wife and husband were both insured 
under the same UIM coverage, the surviving spouse would always 
be 
able 
to 
assert 
per 
person 
UIM 
coverage 
unless 
the 
tortfeasor's policy limits exceeded the amount paid to the 
estate.  To illustrate, if the drunk driver who killed Nancy 
Langridge's husband had $500,000 per person liability limits, 
and that entire amount was paid to William Langridge's estate, 
Nancy Langridge would be able to make the same argument she is 
making now.  Payment to an estate7 would never eliminate a 
wrongful death claim under paragraph "b" unless the tortfeasor 
did not pay out its limits of liability and had, say, $100,000 
left.  Mrs. Langridge's reading of the policy essentially 
transforms UIM into a form of life insurance for a spouse killed 
in an automobile accident.  This is not consistent with a 
reasonable insured's understanding of the UIM policy. 
                                                 
7 A wrongful death claim belongs to the surviving spouse, 
not the deceased's estate.  See Miller v. Luther, 170 Wis. 2d 
429, 436, 489 N.W.2d 651 (Ct. App. 1992).  "The action for 
wrongful death does not belong to the estate of the deceased."  
Weiss v. Regent Props. Ltd., 118 Wis. 2d 225, 230, 346 N.W.2d 
766 (1984) (quoting Nichols v. United States Fid. and Guar. Co., 
13 Wis. 2d 491, 496, 109 N.W.2d 131 (1961)).   
No. 02-3353-FT 
 
24 
 
¶52 Another way of saying this is that a tortfeasor's 
motor vehicle would likely be transformed into an "underinsured 
motor vehicle" whenever another insured had a wrongful death 
claim.  This would untether the definition of "underinsured 
motor vehicle" from the concept it was intended to define.  It 
would transform a policy embodying the second view of UIM 
coverage into a policy delivering the first view of UIM 
coverage.  See ¶¶ 16, 17, supra.  A reasonable insured would not 
expect that the definition of "underinsured motor vehicle" would 
shift so dramatically from one paragraph to another. 
¶53 In contrast, State Farm's reading of the policy——that 
"the insured" here must mean William Langridge, "the insured" 
who suffered the bodily injury——is contextually harmonious with 
the rest of the policy.  If (1) persons other than William 
Langridge suffered bodily injury; (2) received payment from the 
tortfeasor's liability insurer; and (3) thereby reduced that 
policy's limits of liability such that the tortfeasor's limits 
of liability provided less coverage for an insured than the UIM 
policy, then the tortfeasor's vehicle would be "underinsured."  
A rational consumer who purchases this coverage would not expect 
that the policy would provide an independent fund for wrongful 
death irrespective of the amount of coverage a tortfeasor has 
purchased, e.g., the first view of UIM coverage. 
¶54 Accordingly, we conclude that there is only one 
reasonable 
reading 
of 
paragraph 
"b." 
 
When 
this 
policy 
references payments to persons other than "the insured," "the 
insured" can only reasonably refer to William Langridge.  The 
No. 02-3353-FT 
 
25 
 
Langridge policy is not ambiguous because the disputed provision 
is susceptible to only one reasonable interpretation.   
¶55 To sum up, when we analyze the drunk driver's vehicle 
on the facts before us, we conclude that it was not an 
"underinsured motor vehicle."  The drunk driver's vehicle had a 
per person liability limit greater than the per person UIM limit 
in the Langridge policy and the drunk driver's per person limit 
of liability was completely paid out to the only "insured" who 
had an independent claim for bodily injury, William Langridge.  
Under the policy, Mrs. Langridge had a derivative claim for her 
husband's bodily injury.  She had a right to pursue that 
derivative claim whether or not she suffered bodily injury, but 
only until the tortfeasor's per person limit of liability was 
exhausted.  She did not have her own independent claim under the 
policy.  Her interpretation of paragraph "b" to the contrary is 
unreasonable 
and 
in 
conflict 
with 
the 
expectation 
of 
a 
reasonable insured.  Because the drunk driver's vehicle was not 
an "underinsured motor vehicle," the Langridge policy provided 
no UIM coverage.  Accordingly, the decision of the court of 
appeals is affirmed. 
By the Court.—The decision of the court of appeals is 
affirmed. 
¶56 DIANE S. SYKES, J., did not participate. 
 
 
No.  02-3353-FT.awb 
 
1 
 
¶57 ANN WALSH BRADLEY, J.   (dissenting).  The majority 
concludes that the policy unambiguously provides no coverage to 
Nancy Langridge for her wrongful death claim.  Its essential 
analysis for this conclusion is limited to only three paragraphs 
sandwiched in the middle of the opinion.  Because I believe that 
the three paragraphs of analysis do not support the majority's 
conclusion and that any ambiguity should be construed against 
State Farm, I respectfully dissent. 
¶58 Initially, 
the 
focus 
of 
this 
case 
was 
whether 
Langridge had to sustain bodily injury in order to collect on 
her claim.8  State Farm denied Langridge's claim on the basis 
that she "was not involved in the accident."  When asked to 
clarify, State Farm explained that Langridge was not entitled to 
coverage under the policy because she "did not sustain her own 
bodily injuries in the accident." 
¶59 The circuit court awarded summary judgment to State 
Farm, subscribing to its then unambiguous interpretation of the 
policy.  It determined that Langridge could not collect on her 
                                                 
8 The language then at issue provided in relevant part:  
UNDERINSURED MOTOR VEHICLE – COVERAGE W 
You 
have 
this 
coverage 
if 
"W" 
appears 
in 
the 
"Coverages" space on the declarations page.   
We will pay damages for bodily injury an insured is 
legally entitled to collect from the owner or driver 
of an underinsured motor vehicle.  The bodily injury 
must be caused by accident arising out of the 
operation, maintenance or use of an underinsured motor 
vehicle. 
No.  02-3353-FT.awb 
 
2 
 
claim because "the insured attempting to claim underinsured 
motorist coverage must have suffered a bodily injury."   
¶60 The court of appeals affirmed the judgment of the 
circuit court.  It too concluded that Langridge "must have 
sustained a bodily injury herself . . . because under the policy 
only those who suffered bodily injury may recover."  State Farm 
Mut. Auto. Ins. Co. v. Langridge, No. 02-3353-FT, unpublished 
order at 3 (Wis. Ct. App. June 4, 2003). 
¶61 Now 
State 
Farm 
changes 
its 
course. 
 
Although 
successful at both the circuit court and court of appeals, it 
now concedes that the language of the policy should be 
interpreted to provide that Langridge did not have to suffer 
bodily injury in order to recover under the policy.  Indeed, in 
this court, State Farm advances a different argument altogether, 
maintaining that Langridge cannot collect on her claim because 
the definition of an underinsured motor vehicle is not met. 
¶62 The provision in dispute is paragraph "b" of the 
"underinsured 
motor vehicle" 
definition.  
That 
definition 
provides in relevant part: 
Underinsured Motor Vehicle – means a land motor 
vehicle. . . .  
2. whose limits of liability for bodily injury 
liability: 
a. are less than the limits of liability of this 
coverage; or 
b. have been reduced by payments to persons other than 
the insured to less than the limits of liability of 
this coverage. 
(Emphasis added). 
No.  02-3353-FT.awb 
 
3 
 
¶63 Langridge maintains that the vehicle driven by the 
drunk driver meets the policy's definition of an "underinsured 
motor vehicle."  Specifically, she asserts that paragraph "b" of 
the definition renders the drunk driver's vehicle "underinsured" 
as to her.  Langridge notes that she is "insured" under the 
policy and that the drunk driver's liability limits were paid to 
persons other than her, namely her husband. 
¶64 State Farm contends that Langridge is attempting to 
split her husband's bodily injury claim into two in order to 
obtain coverage under the policy.  Although it acknowledges that 
Langridge could qualify as "the insured" under the plain 
language of paragraph "b," it argues that the provision must be 
read in context of the whole policy.  Based upon such context, 
State Farm submits that the only relevant question is whether 
the drunk driver was underinsured as to Langridge's husband.  
Because he was not, it reasons, the drunk driver cannot be 
underinsured as to Langridge.   
¶65 In concluding that the disputed language of the policy 
is unambiguous and that it precludes recovery for Langridge, the 
majority engages in substantial extraneous discussion.  From the 
sheer volume of discussion, a red flag arises, suggesting that 
if it takes that much discussion to conclude that a single 
sentence in a policy is clear and unambiguous, something is 
suspect. 
¶66 The analysis of the majority is suspect with good 
cause.  Although it maintains that the language is "not 
ambiguous," the majority engages in a lengthy discussion, 
No.  02-3353-FT.awb 
 
4 
 
describing what a court does if the language is deemed 
ambiguous.  Majority op., ¶¶43-46.  This discussion serves to 
mask the inadequate reasoning of its conclusion. 
¶67 At this point, it may be best for the reader to turn 
back to the three paragraphs of analysis which underpin the 
majority's conclusion.  These paragraphs, 38, 39, and 40, 
comprise the total analysis set forth in Section D.1, which 
interprets the pivotal policy provision at issue in this case.  
According to the majority, "the outcome of this case turns on 
whether 'the insured' in paragraph 'b' could reasonably refer to 
Nancy Langridge."  Id., ¶37. 
¶68 In paragraph 38, the majority observes that if 
paragraph "b" had referred to "AN insured" instead of "THE 
insured," there would be no issue in this case.  Although this 
is true, it is completely beside the point.  The language of 
paragraph "b" is "the insured."  While State Farm could have 
very easily drafted its policy language differently so as to 
preclude Langridge's claim (e.g., requiring that an insured 
suffer his or her own bodily injury in order to recover), it 
chose not to do so.   
¶69 In paragraph 39, the majority notes that if Langridge 
were not a named insured, she could make a claim representing 
the estate under paragraph "a."  Again, this analysis misses the 
mark.  All agree that Langridge is a named insured.  Her claim 
of wrongful death is independent of her husband's estate.  Thus, 
the only relevant inquiry is whether the plain language of 
No.  02-3353-FT.awb 
 
5 
 
paragraph "b" renders the drunk driver's vehicle underinsured as 
to her. 
¶70 Finally, in paragraph 40, the majority asks, "[H]ow 
can [Langridge] expect an interpretation of the policy that an 
insured who suffers no bodily injury has an independent claim 
equal to the claim of a surviving insured who actually suffers 
bodily injury?"  This question, of course, echoes the earlier 
misinterpretations of the circuit court and court of appeals.  
State Farm has now abandoned the position that bodily injury is 
required to state a claim; the majority should do the same. 
¶71 On its face, State Farm's policy appears to provide 
coverage for Langridge's wrongful death claim.  There is no 
dispute that she is "insured" under the policy.  Rather, the 
dispute centers on whether Langridge can meet the definition of 
underinsured motor vehicle under paragraph "b."  That paragraph 
refers to a land motor vehicle whose limits of liability for 
bodily injury "have been reduced by payments to persons other 
than the insured to less than the limits of liability of this 
coverage."   
¶72 Here, Langridge is "the insured."  The limits of 
liability for bodily injury have been reduced by payments to 
persons other than Langridge, that is, by payments to her 
husband for his conscious pain and suffering.  Additionally, the 
limits of liability of the drunk driver have been reduced to 
less than the limits of liability of the coverage.  The policy 
limits of the drunk driver were exhausted via the payment to 
Langridge's husband.   
No.  02-3353-FT.awb 
 
6 
 
¶73 I believe that the more reasonable interpretation of 
the language of paragraph "b" is as stated above.  Even if, as 
State Farm asserts, it is reasonable to interpret "the insured" 
in paragraph "b" as referring to Langridge's husband rather than 
to 
Langridge, 
then 
we 
are 
left 
with 
two 
reasonable 
interpretations of this policy language.  Words or phrases of an 
insurance policy are ambiguous if they are susceptible to more 
than one reasonable construction.  Badger Mut. Ins. Co. v. 
Schmitz, 2002 WI 98, ¶51, 255 Wis. 2d 61, 647 N.W.2d 223.  If 
the policy language is ambiguous, we construe it against the 
drafter.  Id.  I therefore conclude that Langridge is entitled 
to coverage under our traditional canons of construction.     
¶74 In sum, the majority once again invokes the mantra of 
unambiguous policy language to defeat an insured's reasonable 
expectation of recovery.  Its decision to do so boils down to 
three paragraphs of weak and unsupportable analysis.  I 
determine that the policy provision at issue is ambiguous and 
should be construed against State Farm.  Accordingly, I 
respectfully dissent.  
¶75 I am authorized to state that Chief Justice SHIRLEY S. 
ABRAHAMSON, joins this dissent. 
No.  02-3353-FT.awb 
 
 
 
1