Title: ACUITY v. Estate of Michael Shimeta
Citation: N/A
Docket Number: 2020AP000189
State: Wisconsin
Issuer: Wisconsin Supreme Court
Date: April 7, 2023

2023 WI 28 
 
SUPREME COURT OF WISCONSIN 
 
 
 
 
 
CASE NO.: 
2020AP189 
 
 
 
COMPLETE TITLE: 
ACUITY, a Mutual Insurance Co., 
          Plaintiff-Respondent-Petitioner, 
     v. 
Estate of Michael Shimeta and Terry Scherr, 
          Defendants-Appellants, 
Partners Mutual Insurance Co., 
          Intervening Defendant. 
 
 
 
 
 
REVIEW OF DECISION OF THE COURT OF APPEALS  
Reported at 399 Wis. 2d 375, 965 N.W.2d 78 
PDC No: 2021 WI App 64 - Published  
 
 
OPINION FILED: 
April 7, 2023    
SUBMITTED ON BRIEFS: 
        
ORAL ARGUMENT: 
September 30, 2022   
 
 
SOURCE OF APPEAL: 
 
 
COURT: 
Circuit   
 
COUNTY: 
Milwaukee   
 
JUDGE: 
Jeffrey A. Conen   
 
 
 
JUSTICES: 
KAROFSKY, J., delivered the majority opinion of the Court, in 
which ANN WALSH BRADLEY, ROGGENSACK, and DALLET, JJ., joined. 
ZIEGLER, C.J., filed a dissenting opinion, in which REBECCA 
GRASSL BRADLEY, J., joined.  HAGEDORN, J., filed a dissenting 
opinion, in which REBECCA GRASSL BRADLEY, J., joined.   
NOT PARTICIPATING: 
       
ATTORNEYS: 
 
 
For the plaintiff-respondent-petitioner, there were briefs 
filed by Christine M. Rice, Nicole R. Radler, and Simpson & 
Deardorff, S.C., Milwaukee. There was an oral argument by 
Christine M. Rice.  
 
For the defendants-appellants, there was a brief filed by 
Brett A. Eckstein and Cannon & Dunphy, S.C., Brookfield. There 
was an oral argument by Brett A. Eckstein.  
 
 
2 
An amicus curiae brief was filed by James A. Friedman, 
Daniel C.W. Narvey, and Godfrey & Kahn, S.C., Madison, for the 
Wisconsin Insurance Alliance.  
 
An amicus curiae brief was filed by Mark L. Thomsen, Lynn 
R. Laufenberg, and Gingras, Thomsen, & Wachs, LLP, Madison, for 
the Wisconsin Association for Justice.  
 
 
 
 
2023 WI 28 
NOTICE 
This opinion is subject to further 
editing and modification.  The final 
version will appear in the bound 
volume of the official reports.   
No.   2020AP189 
(L.C. No. 
2019CV5402) 
STATE OF WISCONSIN  
 
 
   : 
IN SUPREME COURT 
 
 
ACUITY, a Mutual Insurance Co., 
 
          Plaintiff-Respondent-Petitioner, 
 
     v. 
 
Estate of Michael Shimeta and Terry Scherr, 
 
          Defendants-Appellants, 
 
Partners Mutual Insurance Co., 
 
          Intervening Defendant. 
FILED 
 
APR 7, 2023 
 
Sheila T. Reiff 
Clerk of Supreme Court 
 
 
 
 
KAROFSKY, J., delivered the majority opinion of the Court, in 
which ANN WALSH BRADLEY, ROGGENSACK, and DALLET, JJ., joined. 
ZIEGLER, C.J., filed a dissenting opinion, in which REBECCA 
GRASSL BRADLEY, J., joined.  HAGEDORN, J., filed a dissenting 
opinion, in which REBECCA GRASSL BRADLEY, J., joined. 
 
 
REVIEW of a decision of the Court of Appeals.  Affirmed.   
 
¶1 
JILL J. KAROFSKY, J.   This case arises from a tragic 
automobile accident that occurred when Douglas Curley lost 
control of his vehicle, crossed the center line, and hit another 
vehicle, killing Michael Shimeta and seriously injuring his 
passenger, Terry Scherr.  As a result of the accident, Curley's 
No. 
2020AP189   
 
2 
 
insurer paid Shimeta's estate (Shimeta) and Scherr $250,000 
each.  Shimeta and Scherr sought additional recovery under a 
policy that Acuity had issued to Shimeta prior to the accident.  
The policy included underinsured motorist (UIM) coverage with a 
$500,000 limit for "each person" and a $500,000 limit for "each 
accident."  At issue in this case is whether Acuity's UIM 
coverage entitles Shimeta and Scherr to an additional $250,000 
each from Acuity, or whether the payments Shimeta and Scherr 
received from Curley's insurer reduced their recovery to 
nothing.  To resolve this issue, we must interpret the UIM 
policy's reducing clause, which states that "[t]he limit of 
liability shall be reduced by all sums . . . [p]aid because of 
the bodily injury by or on behalf of persons . . . who may be 
legally responsible." 
¶2 
We conclude that the reducing clause operates on an 
individual basis to reduce the $500,000 "each person" limit of 
liability by the $250,000 payment that Shimeta and Scherr each 
received from Curley's insurer.  Consequently, Acuity owes 
Shimeta and Scherr $250,000 each.  Accordingly, we affirm the 
court of appeals' reversal of the circuit court's1 grant of 
declaratory judgment for Acuity. 
I.  BACKGROUND 
¶3 
Michael Shimeta was tragically killed and Terry Scherr 
was severely injured on November 22, 2018 when Douglas Curley 
                                                 
1 The Honorable Jeffrey A. Conen of the Milwaukee County 
Circuit Court presiding. 
No. 
2020AP189   
 
3 
 
lost control of his pickup truck on Highway 10 in Portage 
County, crossed the center line, flipped in the air, and landed 
on top of Shimeta's Jeep.  It is undisputed that Shimeta and 
Scherr's injuries met or exceeded $1 million in damages. 
¶4 
Curley was insured under an automobile liability 
insurance policy issued by Farmers Insurance Company.  The 
policy provided coverage up to a $250,000 "per person" limit of 
liability, and a $500,000 "per accident" limit of liability.  In 
accordance with this policy, Farmers paid Shimeta and Scherr 
$250,000 each. 
¶5 
Shimeta and Scherr were also covered under a UIM 
policy that Acuity issued to Shimeta.  The policy's liability 
limits for UIM coverage are $500,000 for "each person" and 
$500,000 for "each accident."  The policy includes a reducing 
clause that states: "[t]he limit of liability shall be reduced 
by all sums . . . [p]aid because of the bodily injury2 by or on 
behalf of persons . . . who may be legally responsible." 
¶6 
The parties do not dispute that both Shimeta and 
Scherr were insured under the UIM policy.  Nor do they dispute 
that Curley's truck was an "underinsured motor vehicle" as 
defined by the policy.  In dispute is whether Acuity must still 
pay $250,000 each to Shimeta and Scherr, or whether the $500,000 
in combined payments from Farmers reduced Acuity's policy limits 
to zero. 
                                                 
2 In Acuity's policy, defined terms are in bold font.  Those 
terms are underlined in this opinion. 
No. 
2020AP189   
 
4 
 
¶7 
Acuity filed an action for declaratory judgment, 
asking the circuit court to find that Acuity was not obligated 
to pay Shimeta and Scherr any UIM benefits under its policy 
because Shimeta and Scherr had already received a total of 
$500,000 from Farmers.  The circuit court granted Acuity's 
motion, reasoning that Acuity's $500,000 maximum limit for "each 
accident" was reduced to zero by Farmers' combined payments to 
Shimeta and Scherr.  The court of appeals reversed, concluding 
that the reducing clause operates on an individual basis to 
reduce the limit of liability for "each person" by the payment 
that "each person" insured under the policy received.  We agree 
with the court of appeals and conclude that the clause reduces 
the "each person" limit by the payments an individual insured 
received for his or her injuries. 
II.  ANALYSIS 
¶8 
This case requires the court to interpret the language 
of an insurance policy, which presents a question of law that we 
review de novo.  Mau v. N.D. Ins. Rsrv. Fund, 2001 WI 134, ¶12, 
248 Wis. 2d 1031, 637 N.W.2d 45. 
¶9 
Analyzing Acuity's UIM policy requires us to put the 
disputed UIM policy language in context.  To do so, we first 
provide a brief overview of the purpose of UIM coverage and the 
principles we use when interpreting UIM policies.  Next, we 
review the UIM policy language at issue in this case.  We then 
conclude that the policy's reducing clause, when read in the 
context of the whole policy, reduces the limit of liability for 
"each person" by the payments received by each individual 
No. 
2020AP189   
 
5 
 
insured.  We further determine that the policy's "each accident" 
limit 
of 
liability 
serves 
as 
an 
additional 
backstop, 
establishing the maximum amount that Acuity will pay out for any 
one accident. 
A.  UIM Background 
¶10 As a general matter, the purpose of UIM coverage is to 
protect "persons insured under that coverage who are legally 
entitled to recover damages for bodily injury, death, sickness, 
or disease from owners or operators of underinsured motor 
vehicles."  Wis. Stat. § 632.32(2)(d) (2019-20).3  This court has 
identified two approaches to UIM coverage, both of which are 
permissible under Wis. Stat. § 632.32(4m).  Welin v. Am. Fam. 
Mut. Ins. Co., 2006 WI 81, ¶¶24-27, 292 Wis. 2d 73, 717 
N.W.2d 690.  Policies that follow the "separate fund" approach 
provide a set amount of coverage for the insured's damages that 
exceed the amount the insured recovers from the responsible 
party.  State Farm Mut. Auto. Ins. Co. v. Langridge, 2004 WI 
113, ¶16, 275 Wis. 2d 35, 683 N.W.2d 75.  Policies that follow 
the "limits-to-limits" approach——like Acuity's policy——provide 
"a predetermined, fixed level of UIM recovery that is arrived at 
by combining payments from all sources" legally responsible for 
the insured's damages.  Welin, 292 Wis. 2d 73, ¶49.  To that 
end, Wis. Stat. § 632.32(5)(i) allows insurers to write UIM 
policies that "provide that the limits under the policy" shall 
                                                 
3 All subsequent references to the Wisconsin Statutes are to 
the 2019-2020 version unless otherwise indicated. 
No. 
2020AP189   
 
6 
 
be reduced by "[a]mounts paid by or on behalf of any person or 
organization that may be legally responsible for the bodily 
injury or death for which the payment is made." 
¶11 While our UIM cases provide a helpful framework for 
interpreting policy language, we pause to note that a UIM policy 
is a contract, and "[w]here the language of the policy is plain 
and unambiguous, we enforce it as written . . . .  This is to 
avoid rewriting the contract by construction and imposing 
contract obligations that the parties did not undertake."  
Danbeck v. Am. Fam. Mut. Ins. Co., 2001 WI 91, ¶10, 245 
Wis. 2d 186, 629 N.W.2d 150 (internal citations omitted).  We 
interpret the policy language as a reasonable insured would 
understand it, and if the language is ambiguous, we construe it 
in favor of the insured.  Id.  With these principles in mind, we 
turn to the language of the contract at issue in this case. 
B.  Policy Language 
 
¶12 We begin our review of the insurance policy by 
examining the Declarations page.  We next look to the UIM grant 
of coverage, then we examine the definition of "underinsured 
motor vehicle," and finally we analyze the Limits of Liability 
section, which contains the reducing clause at issue in this 
case. 
¶13 The policy's Declarations page lists the types of 
coverage the policy provides, including "Underinsured Motorists" 
coverage 
for 
"$500,000 
Each 
Person" 
and 
"$500,000 
Each 
Accident." 
 
The 
Declarations 
page 
does 
not 
provide 
any 
additional information about "Underinsured Motorists" coverage 
No. 
2020AP189   
 
7 
 
or what "Each Person" or "Each Accident" mean, so we turn next 
to the Underinsured Motorists Coverage section in Part IV of the 
policy for further clarification. 
¶14 The Underinsured Motorists Coverage section first 
includes the following grant of coverage: 
We [Acuity] will pay damages for bodily injury which 
an insured person is legally entitled to recover from 
the owner or operator of an underinsured motor 
vehicle.  Bodily injury must be sustained by an 
insured person and must be caused by accident and 
result from the ownership, maintenance, or use of the 
underinsured motor vehicle. 
Acuity does not dispute that: (1) Shimeta and Scherr were 
legally entitled to recover at least $1 million in damages for 
bodily injury from Curley; (2) Shimeta and Scherr were both 
"insured persons" under Acuity's policy; and (3) Shimeta and 
Scherr sustained injuries that were caused by the accident.  
Having established that both Shimeta and Scherr meet the initial 
requirements set out in the grant of coverage, we next examine 
the policy's definition of "underinsured motor vehicle." 
¶15 The policy defines "underinsured motor vehicle" as a 
vehicle covered by an insurance policy with a "limit for bodily 
injury liability" that is "less than the limit of liability for 
this coverage."  Acuity does not dispute that Curley operated an 
"underinsured motor vehicle."  Curley's automobile liability 
insurance provided coverage up to a $250,000 "per person" limit 
of liability and a $500,000 "per accident" limit of liability.  
No. 
2020AP189   
 
8 
 
Under a split-limits policy4 like Curley's, "an insured's 
objectively reasonable expectation is that the phrase 'limit for 
bodily injury liability' means the per person limit of a 
tortfeasor's liability policy."  Filing v. Com. Union Midwest 
Ins. Co., 217 Wis. 2d 640, 650, 579 N.W.2d 65 (Ct. App. 1998). 
¶16 Although Acuity does not dispute that Curley is 
underinsured, it maintains that Shimeta and Scherr are not 
entitled to recover under the policy because, under the Limits 
of Liability section, the $500,000 in combined payments they 
received from Farmers reduced the policy limits to zero.  The 
relevant portion of the Limits of Liability section is as 
follows: 
Limits of Liability 
1. 
The Limit of Liability shown in the Declarations 
for each person for Underinsured Motorists coverage is 
our maximum limit of liability for all damages, 
including damages for care, loss of services or death, 
arising out of bodily injury sustained by any one 
person in any one accident. Subject to this limit per 
person, 
the 
Limit 
of 
Liability 
shown 
in 
the 
Declarations 
for 
each 
accident 
for 
Underinsured 
Motorists coverage is our maximum limit of liability 
for all damages for bodily injury resulting from any 
one accident. 
This is the most we will pay regardless of the number 
of:  
a. Insured persons; 
b. Claims made; 
                                                 
4 Policies with different per person and per accident limits 
are sometimes referred to as "split-limits" policies.  See 
Folkman v. Quamme, 2003 WI 116, ¶7, 264 Wis. 2d 617, 665 
N.W.2d 857. 
No. 
2020AP189   
 
9 
 
c. Vehicles or premiums shown in the Declarations; or 
d. Vehicles involved in the accident. 
2. 
The limit of liability shall be reduced by all 
sums: 
a. Paid because of the bodily injury by or on behalf of 
persons 
or 
organizations 
who 
may 
be 
legally 
responsible.  This includes all sums paid under Part 
I – Liability; and 
b. Paid or payable because of the bodily injury under 
any of the following or similar law: 
(1) 
Workers' compensation law; or  
(2) 
Disability benefits law. 
¶17 Paragraph 1 of this section defines the "each person" 
and "each accident" limits set out in the Declarations page, 
establishing that those limits are the maximum that Acuity will 
pay for any one person in an accident, and for any one accident, 
respectively.  Paragraph 1 also states that the "each accident" 
limit is subject to the "each person" limit.  Paragraph 2 
includes a reducing clause providing that "the limit of 
liability" will be reduced by payments from those legally 
responsible for the insured's damages. 
¶18 The parties agree that, under paragraph 1 and the 
limits set in the Declarations page, Acuity will never pay more 
than $500,000 to any individual insured for any one accident.  
Additionally there is agreement that Acuity will never pay more 
than $500,000 total for any one accident, regardless of the 
number of insureds.  The parties' sole dispute is over the 
reducing clause in paragraph 2.  
C.  The Reducing Clause 
No. 
2020AP189   
 
10 
 
 
¶19 The parties dispute the meaning of two separate, but 
related parts of the reducing clause: (1) "the limit of 
liability" and (2) "all sums . . . [p]aid because of the bodily 
injury." 
 
¶20 Shimeta and Scherr argue that "the limit of liability" 
is the "each person" limit of liability.  Alternatively, they 
argue that "the limit of liability" is ambiguous because it does 
not specify which limit applies, and the court construes 
ambiguity 
in 
favor 
of 
the 
insured. 
 
See 
Danbeck, 
245 
Wis. 2d 186, ¶10.  Acuity argues that "the limit of liability" 
could refer to either the "each person" or "each accident" 
limit, "depending on the facts of the case," and in this case it 
is the "each accident" limit. 
¶21 Regarding the phrase, "all sums . . . [p]aid because 
of the bodily injury . . ." Shimeta and Scherr argue that it 
means all sums paid because of the bodily injury suffered by the 
individual insured making the claim.  Acuity argues that the 
phrase means all sums paid for all injuries suffered by any 
insureds injured in a single accident. 
¶22 We agree with Shimeta and Scherr's interpretations and 
conclude that the reducing clause operates to reduce recovery on 
an individual basis.  That is, the reducing clause reduces the 
"each person" limit for an insured by all payments for the 
No. 
2020AP189   
 
11 
 
insured's injury.  To explain why, we will analyze the two 
phrases in turn.5 
1.  "The Limit of Liability" 
¶23 We start with the phrase "the limit of liability."  On 
first inspection, this phrase appears to be ambiguous.  The 
policy has two limits of liability——indeed, this section is 
called "Limits of Liability," and paragraph 1 refers to the 
"each person" and "each accident" limit separately and in turn.  
But, unlike paragraph 1, the reducing clause does not specify 
whether "the limit of liability" refers to the "each person" 
limit or the "each accident" limit.  Therefore, it is not 
immediately clear what "the limit of liability" means. 
¶24 Ambiguity, as we have noted, is to be construed in 
favor of the insured.  However, a phrase can seem ambiguous in 
isolation, but become unambiguous from the perspective of a 
reasonable insured when viewed within the context of a policy.  
See Badger Mut. Ins. Co. v. Schmitz, 2002 WI 98, ¶49, 255 
Wis. 2d 61, 647 N.W.2d 223.  Here, there are four possible 
interpretations of "limit of liability"——the phrase could mean: 
                                                 
5 Although we analyze the two disputed phrases separately, 
we note that the phrases are interrelated and there are only two 
proposed readings of the clause as a whole.  The first, favored 
by Shimeta and Scherr, is that the clause reduces the "each 
person" limit for an insured by all payments for the insured's 
injury.  The second, favored by Acuity, is that the clause 
reduces the "each accident" limit by all payments made for all 
insureds' injuries.  Neither party argues that the "each person" 
limit should be reduced by payments made on behalf of all 
insureds, or that the "each accident" limit should be reduced by 
payments made on behalf of just one insured. 
No. 
2020AP189   
 
12 
 
(1) both the "each person" and the "each accident" limit; (2) 
either the "each person" or the "each accident" limit depending 
on the facts of the case; (3) only the "each person" limit; or 
(4) only the "each accident" limit.  We analyze each of these 
four possible interpretations and conclude that the phrase 
unambiguously refers to only the "each person" limit. 
¶25 We first consider whether "the limit of liability" 
could mean both the "each person" and the "each accident" limit.  
In doing so we immediately see that "the limit of liability" 
(emphasis added) is phrased in the singular, rather than plural.  
The "common and ordinary meaning" of the singular term "the 
limit of liability" is one particular limit, rather than more 
than one.  See Danbeck, 245 Wis. 2d 186, ¶10, ("The words of an 
insurance policy are given their common and ordinary meaning"); 
see also Filing, 217 Wis. 2d at 650 (holding that an unspecified 
"limit for bodily injury liability" in an Underinsured Motorist 
definition referred to the "per person" limit, rather than both 
limits).  From a reasonable insured's point of view, the limit 
would refer to a singular limit of "each person" or "each 
accident," not both. 
¶26 If Acuity meant to refer to more than one limit, it 
could use the word "limits," as it did in the title of the 
section 
("Limits 
of 
Liability"). 
 
Wisconsin 
Stat. 
§ 632.32(5)(i), which authorizes insurers to use reducing 
clauses in their UIM policies, also uses the plural form 
No. 
2020AP189   
 
13 
 
"limits."6  Because Acuity did not refer to the plural form 
"limits," an insured is likely to understand that the reducing 
clause is referring to only one limit. 
¶27 We next consider whether "the limit of liability" in 
the reducing clause refers to either the "each person" limit or 
"each accident" limit depending on the facts of the case.  
Acuity argues, "[w]hen there is more than one injured insured, 
paragraph 1 dictates that the 'limit of liability' to be reduced 
is the each accident limit."  But neither paragraph 1 nor the 
reducing clause actually say that the limit of liability to be 
reduced changes depending on the number of injured insureds, and 
Acuity has not pointed us to anywhere else in the policy that 
does so.7 
                                                 
6 Wisconsin Stat. § 632.32(5)(i) states that "A policy may 
provide that the limits under the policy for uninsured motorist 
coverage or underinsured motorist coverage for bodily injury or 
death resulting from any one accident shall be reduced by any of 
the following that apply" (emphasis added). 
7  The dissenting opinions assert that paragraph 1 of the 
Limits of Liability section establishes that the "limit of 
liability" is used in the singular to denote the most Acuity 
will pay depending on the number of insureds and chosen 
coverages.  See Chief Justice Ziegler's dissent, ¶50; Justice 
Hagedorn's dissent, ¶61.  But paragraph 1 does not do so——as 
stated previously, paragraph 1 uses "limit of liability" in the 
singular to describe the each person and each accident limit 
separately and in turn.  Paragraph 1 simply sets out the rules 
we all agree on: (1) the each person "Limit of Liability" is the 
"maximum limit of liability . . . arising out of bodily injury 
sustained by any one person in any one accident," and (2) the 
each accident "Limit of Liability" is the "maximum limit of 
liability for all damages for bodily injury resulting from any 
one accident."  Paragraph 1 reinforces that there are two limits 
of liability and does not answer the relevant question: which 
"limit of liability" is the reducing clause referring to? 
No. 
2020AP189   
 
14 
 
¶28 Given the language of the reducing clause, it is 
unclear how a reasonable insured would understand that "the 
limit" is different depending on the facts of the case, much 
less figure out how the facts of a particular case would 
determine which limit would be reduced.  As we have reasoned in 
previous UIM cases, "reducing clauses must be crystal clear in 
the context of the whole policy.  Otherwise, insureds are not 
likely to understand what they are purchasing."  Badger Mut. 
Ins. Co., 255 Wis. 2d 61, ¶46.  There may, of course, be some 
variation in recovery depending on the facts of a particular 
case, but if the insurer intends for the coverage rules and 
definitions to vary, the insurer must make the rules governing 
that variation clear in its policy language so that the insured 
understands what coverage he or she is actually purchasing.  See 
id.   
¶29 Because the term "limit of liability" is undefined in 
the policy, it is given its plain and ordinary meaning.  
Hirschhorn v. Auto-Owners Ins. Co., 2012 WI 20, ¶28, 338 
Wis. 2d 761, 809 N.W.2d 529.  The reducing clause refers to "the 
limit" as opposed to "either limit" or "a limit," and it does 
not indicate in any way that the limit may vary.  Therefore, the 
common, 
ordinary 
meaning 
of 
"the 
limit" 
is 
one 
single, 
particular limit. 
¶30 Having 
decided 
that 
a 
reasonable 
insured 
would 
understand "the limit of liability" to refer to one particular 
limit of liability, rather than both limits or either limit, the 
next question is whether the phrase unambiguously refers to the 
No. 
2020AP189   
 
15 
 
"each person" limit, the "each accident" limit, or whether the 
phrase is ambiguous.  We conclude that a reasonable insured 
would understand "the limit of liability" to unambiguously refer 
to the "each person" limit. 
¶31 Reading "the limit of liability" to mean the "each 
person" 
limit 
harmonizes 
the 
reducing 
clause 
and 
the 
underinsured motor vehicle definition.  The policy defines an 
underinsured motor vehicle as one whose "limit for bodily injury 
liability is . . . less than the limit of liability for this 
coverage."  Both the definition and the reducing clause refer to 
"the limit of liability," and both compare the insured's limit 
of liability with the limit of the responsible party——the 
definition compares each limit in order to determine whether 
there is coverage, and the reducing clause compares each limit 
in order to determine the amount of recovery.  Neither section 
clearly refers to the each person limit, the each accident 
limit, or both.  Importantly, Acuity concedes that the "limit" 
in the UIM definition refers to the "each person" limit of 
liability——otherwise, Curley would not be underinsured as his 
policy had equal "each accident" limits and lower "each person" 
limits than Acuity's policy. 
¶32 An 
insured 
would 
reasonably 
expect 
"the 
limit" 
referred to in both sections to mean the same limit.  If these 
sections referred to different limits, an insured would be 
understandably confused.  It makes little sense that a vehicle 
could be "underinsured" when its policy limits are compared to 
Acuity's UIM policy limits in the definitions section, yet 
No. 
2020AP189   
 
16 
 
treated as equally insured when those same limits are compared 
in the reducing clause.8  In the absence of more specificity, an 
insured would reasonably expect that when similar terms are 
similarly used to compare policy limits, those terms refer to 
the same limit.  Therefore, we read the reducing clause's "limit 
of liability" to mean the "each person" limit, consistent with 
the UIM definition and consistent with what a reasonable insured 
would expect.9 
                                                 
8 Justice Hagedorn's dissent claims we put "too much stock" 
in harmonizing the underinsured motor vehicle definition with 
the reducing clause.  See Justice Hagedorn's dissent, ¶70.  
However, it is well established that when the same or similar 
language is used in a contract or insurance policy, the language 
should be applied consistently.  See Day v. Allstate Indem. Co., 
2011 WI 24, ¶57, 332 Wis. 2d 571, 798 N.W.2d 199 (explaining 
that 
the 
insurer's 
proposed 
definition 
of 
a 
term 
is 
"inconsistent with how the term is used in the context of 
another policy provision").  Although both sections as a whole 
may perform different functions, they both use the same phrase, 
"limit of liability," in answering the same question——how do the 
insured's limits of liability compare with those of the 
responsible party?  A reasonable insured would read these 
phrases consistently. 
Similarly, Chief Justice Ziegler's dissent asserts that by 
interpreting the phrases consistently, we are creating a 
"requirement 
that 
a 
vehicle 
qualifying 
as 
'underinsured' 
automatically means the insured receives payment."  See Chief 
Justice 
Ziegler's 
dissent, 
¶50. 
 
We 
implement 
no 
such 
requirement.  There will still be situations in which an 
underinsured vehicle may not automatically qualify the insured 
for payment——when the insured's recovery is reduced by payments 
received from other sources, for instance. 
9  This interpretation is also consistent with Filing v. 
Com. Union Midwest Ins. Co., 217 Wis. 2d 640, 579 N.W.2d 65 (Ct. 
App. 1998), in which the court of appeals interpreted a UIM 
policy's underinsured motor vehicle definition.  Like the court 
of appeals in Filing, which determined that the "limit for 
bodily injury liability" referenced in the definition was the 
No. 
2020AP189   
 
17 
 
¶33 The dissenting opinions' reading of the reducing 
clause as referring to the maximum amount that Acuity will pay 
depending on the number of insureds and nature of the coverage 
is a logical way that an insurance policy could work.  However, 
the language of this particular policy does not connect the 
dots.  At best, the dissenting opinions provide us with an 
alternative reasonable interpretation of "limit of liability."  
When policy language is "susceptible to more than one reasonable 
interpretation," it is ambiguous.  Danbeck, 245 Wis. 2d 186, 
¶10.  Ambiguity is resolved in favor of the insured, id., so the 
result is the same regardless. 
2.  "All Sums Paid Because of the Bodily Injury" 
 
¶34 We now turn to the second disputed phrase in the 
reducing clause and conclude that "all sums . . . [p]aid because 
of the bodily injury" means payments made because of the bodily 
injury suffered by the individual insured, rather than aggregate 
payments for all bodily injuries suffered by all insureds.  The 
clause states that the limit shall be reduced "by all sums" 
"[p]aid because of the bodily injury by or on behalf of persons 
or organizations who may be legally responsible."  At first 
glance, "by all sums" appears to be expansive, but it is 
immediately qualified by the phrase "because of the bodily 
injury."  The policy defines "bodily injury" as "bodily injury 
                                                                                                                                                             
tortfeasor's "per person limit," we read the policy "from the 
perspective of what the insured as an individual, not insureds 
as a whole, could recover from the tortfeasor's liability 
carrier," and similarly conclude that the reducing clause refers 
to the "each person" limit.  See Filing, 217 Wis. 2d at 649. 
No. 
2020AP189   
 
18 
 
to or sickness, disease or death of a person" (emphasis added).  
This definition uses the singular——referring to one person——
rather than the plural, which would encompass multiple injured 
people.  Although (despite the singular phrasing) "bodily 
injury" does appear to be used elsewhere in the policy to refer 
to injuries suffered by multiple insureds,10 the reducing clause 
further uses an additional singular term, "the bodily injury" 
(as opposed to, for example "bodily injuries" or "any bodily 
injury").  Based on the singular word choice in the reducing 
clause, we conclude that "all sums . . . [p]aid because of the 
bodily injury" means all sums paid because of the bodily injury 
to a singular insured.11 
 
¶35 Like with the phrase "limit of liability," if we were 
to accept that an insured could also read "the bodily injury" 
broadly so that it referred to any injury sustained by all 
insureds, then the phrase would be ambiguous.  We construe 
ambiguous language in favor of the insured, so the result here 
would be the same.  Danbeck, 245 Wis. 2d 186, ¶10. 
 
¶36 When reading the reducing clause as a whole, the most 
reasonable interpretation is that the "each person" limit shall 
                                                 
10 Paragraph 1 of the Limits of Liability section defines 
the each accident limit as the "maximum limit of liability for 
all damages for bodily injury resulting from any one accident." 
11 We are not the first state high court to come to this 
conclusion.  See, e.g., Buell v. Am. Universal Ins. Co., 224 
Conn. 766, 771, 621 A.2d 262 (1993) (determining that "the" 
bodily injury in a reducing clause "refers only to the 
claimant's bodily injury and not to the bodily injury of 
others"). 
No. 
2020AP189   
 
19 
 
be reduced by payments made because of the bodily injury to the 
insured making the claim.  This reading does not make the "each 
accident" limit superfluous.  The "each accident" limit remains 
a cap on what Acuity itself will ever pay for bodily injury 
resulting from any one accident.  Here, Acuity will pay no more 
than that $500,000 limit. 
III.  CONCLUSION 
 
¶37 We affirm the court of appeals because we agree that 
the policy's reducing clause operates on an individual basis to 
reduce the "each person" limit of liability by the payment each 
insured individually received from Curley's insurance. 
 
By the Court.—The decision of the court of appeals is 
affirmed. 
No.  2020AP189.akz 
 
1 
 
 
¶38 ANNETTE KINGSLAND ZIEGLER, C.J.   (dissenting).  I 
dissent because the majority reads Acuity's policy as no 
reasonable insured would, creating coverage out of thin air that 
was never agreed upon.  Acuity's UIM insurance policy is simple.  
Acuity agrees to pay up to a certain limit in the event its 
insured is injured in an accident with a driver whose vehicle is 
underinsured: up to $500,000 per person, but no more than 
$500,000 for any one accident.  This is one among five limits, 
each listed in the "Limits of Liability" section of Acuity's 
policy.  The per person and per accident limits work together as 
one collective limit to Acuity's liability.  But this limit is 
reduced "by all sums" paid by or on behalf of the legally 
responsible party (the "tortfeasor") so the insured does not 
receive duplicate payments.  Because the insureds in this case 
received from the tortfeasor a combined amount equal to Acuity's 
limit, the insureds received exactly the amount they would have 
gotten from Acuity if the tortfeasor had no insurance at all, 
and Acuity's liability is reduced to zero.  Simple as that.  
¶39 But the majority complicates this simple policy.  
Though Acuity's policy discusses the per person and per accident 
limits collectively as one singular "limit of liability," the 
majority reads them separately, ignoring the structure and 
organization of the "Limits of Liability" section.  The majority 
then continues to overcomplicate Acuity's policy, imposing an 
atextual requirement that a vehicle qualifying as "underinsured" 
means the insured will receive payment under Acuity's policy in 
No.  2020AP189.akz 
 
2 
 
every instance.  This is not how Acuity's policy operates.  I 
respectfully dissent.    
I 
¶40 "We interpret the provisions of an insurance policy 
using the same principles applicable to contracts generally."  
Kemper Independence Ins. Co. v. Islami, 2021 WI 53, ¶16, 397 
Wis. 2d 394, 959 N.W.2d 912.  "Where the language of a contract 
is unambiguous and the parties' intentions can be ascertained 
from the face of the contract, we give effect to the words they 
employed."  Steadfast Ins. Co. v. Greenwich Ins. Co., 2019 WI 6, 
¶21, 385 Wis. 2d 213, 922 N.W.2d 71.  "Where the language of the 
policy is plain and unambiguous, we enforce it as written, 
without resort to rules of construction or principles in case 
law."  Fontana Builders, Inc. v. Assurance Co. of Am., 2016 WI 
52, ¶37, 369 Wis. 2d 495, 882 N.W.2d 398 (quoting Danbeck v. Am. 
Fam. Mut. Ins. Co., 2001 WI 91, ¶10, 245 Wis. 2d 186, 629 
N.W.2d 150). 
¶41 We must read policy language in context, not in 
isolation.  "Sometimes it is necessary to look beyond a single 
clause or sentence to capture the essence of an insurance 
agreement."  
Folkman v. Quamme, 2003 WI 116, ¶21, 264 
Wis. 2d 617, 665 N.W.2d 857.  This may require examining a 
policy's organization and structure.  Gohde v. MSI Ins. Co., 
2004 WI App 69, ¶12, 272 Wis. 2d 313, 679 N.W.2d 835 ("We first 
look at the organization and structure of the policy."); 
Remiszewski v. Am. Fam. Ins. Co., 2004 WI App 175, ¶24, 276 
Wis. 2d 167, 687 N.W.2d 809 ("We further conclude that neither 
No.  2020AP189.akz 
 
3 
 
the structure and organization of American Family's policy, nor 
any provision therein, renders the reducing clause contextually 
ambiguous."). 
¶42 The entire "Limits of Liability" section from Acuity's 
policy, including the reducing clause, is reproduced below: 
Limits of Liability 
1. 
The Limit of Liability shown in the Declarations 
for 
each 
person 
for 
Underinsured 
Motorists 
coverage is our maximum limit of liability for 
all damages, including damages for care, loss of 
services or death, arising out of bodily injury 
sustained by any one person in any one accident.  
Subject to this limit for each person, the Limit 
of Liability shown in the Declarations for each 
accident for Underinsured Motorists coverage is 
our maximum limit of liability for all damages 
for 
bodily 
injury 
resulting 
from 
any 
one 
accident. 
This is the most we will pay regardless of the 
number of: 
 
a. 
Insured persons;  
 
b. 
Claims made; 
 
c. 
Vehicles 
or 
premiums 
shown 
in 
the 
Declarations; or 
 
d. 
Vehicles involved in the accident. 
2. 
The limit of liability shall be reduced by all 
sums: 
 
a. 
Paid because of the bodily injury by or on 
behalf of persons or organizations who may 
be legally responsible.  This includes all 
sums paid under Part I – Liability; and 
 
b. 
Paid or payable because of the bodily injury 
under any of the following or similar law: 
 
 
(1) 
Workers' compensation law; or 
No.  2020AP189.akz 
 
4 
 
 
(2) Disability benefits law. 
3. 
No one will be entitled to receive duplicate 
payments for the same elements of loss under this 
coverage 
and 
Part 
I – Liability, 
Part 
II – 
Expenses for Medical Services or Part III – 
Uninsured Motorists coverage provided by this 
policy. 
4. 
We will not make a duplicate payment under this 
coverage for any element of loss for which 
payment has been made by or on behalf of persons 
or organizations who may be legally responsible. 
5. 
We will not make a duplicate payment to the 
extent amounts are paid or payable because of the 
bodily injury under any of the following or 
similar law: 
 
a. 
Workers' compensation law; or  
 
b. 
Disability benefits law. 
Accounting for the structure and organization of the entire 
"Limits of Liability" section in Acuity's UIM policy, it becomes 
clear that the reducing clause reduces both the per person limit 
and the per accident limit. 
¶43 The section is labeled "Limits of Liability" and 
contains five paragraphs.  Each paragraph in some way limits 
Acuity's liability to the insured.  The first paragraph does so 
with reference to the per person and per accident limits; the 
second paragraph being the reducing clause; and the last three 
limit liability for various forms of duplicate payments.  Each 
one of these paragraphs thus operates as a limit to Acuity's 
liability, explaining why the section title uses the plural 
"Limits."  Each paragraph counts as one individual "limit of 
liability."  This also explains why the reducing clause states 
No.  2020AP189.akz 
 
5 
 
"[t]he limit of liability," in the singular, "shall be reduced."  
It is because everything described in the first paragraph is one 
singular "limit of liability" for purposes of the "Limits of 
Liability" section.   
¶44 Paragraph 1.'s own language confirms this reading.  
Immediately after the subparagraph describing both the per 
person limit and the per accident limit, there is a break 
followed 
by 
the 
statement, 
"This 
is 
the 
most 
we 
will 
pay . . . ."  The break indicates that "the most [Acuity] will 
pay" 
is 
everything 
described 
in 
the 
preceding 
subparagraph:  both the per person limit and per accident limit, 
which the policy describes collectively.  Together, they form 
one singular "limit of liability" listed among other limits in 
the "Limits of Liability" section.  Because the per person limit 
and per accident limit constitute one "limit of liability," the 
reducing clause requires that both of them be reduced "by all 
sums" "[p]aid because of the bodily injury." 
II 
¶45 Nowhere does the majority grapple with the "Limits of 
Liability" section's structure and organization.  Its analysis 
never even acknowledges the fact that the "Limits of Liability" 
section contains three additional paragraphs after the reducing 
clause.  This leads the majority to instead rely on a myopic 
reading of the policy that in no way reflects how a reasonable 
insured would understand it. 
¶46 The majority distorts Acuity's policy to maximize the 
insureds' recovery beyond what was bargained for.  After 
No.  2020AP189.akz 
 
6 
 
incorrectly concluding that the reducing clause reduces either 
the per person or the person accident limit, but not both, the 
majority determines that "the limit" in "the limit of liability" 
must be the same both in the reducing clause and in the 
underinsured motor vehicle definition.  Majority op., ¶31.  The 
majority reasons, "It makes little sense that a vehicle could be 
'underinsured' when its policy limits are compared to Acuity's 
UIM policy limits in the definitions section, yet treated as 
equally insured when those same limits are compared in the 
reducing clause."  Id., ¶32.   
¶47 The majority conflates status as "underinsured" with 
the need for payment.1  Under Acuity's policy, a tortfeasor's 
vehicle 
is 
"underinsured" 
when 
the 
associated 
liability 
insurance policy's limit is "[l]ess than the limit of liability 
for this coverage."  A vehicle being "underinsured" does not 
mean the UIM policyholder automatically must receive some 
payment from his insurer.  All it means is that the tortfeasor's 
policy provides less coverage than the insured's policy.  
Whether the tortfeasor's policy will ultimately pay the same 
amount as an insured would receive under his own UIM policy is a 
different 
question 
entirely. 
 
After 
a 
limits-to-limits 
comparison, 
it 
may 
appear 
that 
there 
is 
some 
set 
of 
circumstances where a tortfeasor's policy limit will not provide 
the same amount of coverage as the insured's UIM policy.  But, 
as is the case here, the insured may still receive from the 
                                                 
1 Justice Hagedorn also identifies this error, a criticism 
on which I expand here.  See Justice Hagedorn's dissent, ¶¶70-
71. 
No.  2020AP189.akz 
 
7 
 
tortfeasor the same amount he would have received under his own 
UIM policy even if the tortfeasor's policy limit is "[l]ess than 
the limit of liability for" the insured's UIM coverage.  The 
majority rather, equates insurance with payment even where such 
payment is unnecessary.2 
¶48 The correct result is straightforward.  Acuity's 
liability is limited to $500,000 for any one insured, but no 
more $500,000 for any one accident.  A singular, tragic accident 
caused "bodily injury" to two people insured under Acuity's 
policy.  Each insured's damages from their injuries exceed 
$500,000.  The injuries were caused by a tortfeasor whose 
insurer had a liability limit of $250,000 per person and 
$500,000 per accident.  Thus, both of the insureds in this case 
received only $250,000 because total payments reached the 
tortfeasor's per accident limit.  Under Acuity's policy, because 
the reducing clause treats the per person and per accident 
limits as one collective "limit of liability," they are both 
reduced.  Both insureds received a combined total of $500,000 
because of a single accident, so the per accident limit is 
reduced to zero, meaning there is no coverage remaining for this 
accident. 
                                                 
2 The majority adds more confusion by attempting to ease 
this concern with the fact that payment may still be unnecessary 
"when the insured's recovery is reduced by payments received 
from other sources."  Majority op., ¶32 n.8.  Following the 
majority's logic, no payment is necessary when the insured 
receives a full recovery from the tortfeasor plus "other 
sources," but payment is somehow required when the insured 
receives the same amount from the tortfeasor alone.  Again, no 
reasonable insured would understand Acuity's policy to operate 
this way.   
No.  2020AP189.akz 
 
8 
 
¶49 The fact that the tortfeasor's per person limit caused 
his vehicle to qualify as "underinsured" under Acuity's policy 
does not change this result.  The vehicle was underinsured 
because, due to Acuity's limits-to-limits comparison approach, 
it was possible that the insureds might not receive an amount 
equivalent to the amount they would have received under Acuity's 
UIM policy.  If one insured suffered more than $250,000 in 
damages and the other suffered less, this would mean that the 
insured with more damages would recover less from the tortfeasor 
than he would from Acuity under its UIM policy.  In this 
situation, the tortfeasor's vehicle would be underinsured, and 
payment by Acuity would be necessary.  It is possible that the 
tortfeasor's liability insurance would not have paid the 
insureds the same amount the insureds would receive under 
Acuity's policy, but that is not the case here, so payment by 
Acuity is not necessary.  There is no need to read in confusion 
to reach this sensible result. 
III 
¶50 Acuity's policy is simple and straightforward.  The 
per accident and per person limits operate together as one 
collective "limit of liability" to establish the most Acuity 
might pay.  Because the reducing clause reduces "the limit of 
liability" "by all sums" paid to the insureds by the tortfeasor, 
each component part of that collective limit likewise reduces.  
In this case, the insureds received from the tortfeasor the 
exact amount they would have under Acuity's policy, meaning 
Acuity has no remaining liability.  But the majority eschews 
No.  2020AP189.akz 
 
9 
 
this simple reading in favor of a complex one that no reasonable 
insured would understand.  It also unwittingly creates a 
requirement 
that 
a 
vehicle 
qualifying 
as 
"underinsured" 
automatically means the insured receives payment.  This is 
simply not how Acuity's policy operates.  
¶51 For the foregoing reasons, I respectfully dissent.  
¶52 I am authorized to state that Justice REBECCA GRASSL 
BRADLEY joins this dissent. 
 
No.  2020AP189.bh 
 
1 
 
 
¶53 BRIAN 
HAGEDORN, 
J.   (dissenting). 
 
Before 
his 
unfortunate passing, Michael Shimeta purchased underinsured 
motorist (UIM) coverage from Acuity.  In that policy, Acuity 
agreed to pay claims up to a maximum limit of liability:  
$500,000 per person, but no more than $500,000 total per 
accident.  The operative language and design of these policies 
is standard.  And basic logic tells us that the per accident 
limit will reduce the amount individuals can recover in multi-
person accidents.  In practice, this means that the recovery for 
any individual under Shimeta's policy with Acuity may not be the 
full $500,000 if multiple insureds are injured.  Everyone agrees 
that this is how the policy works.   
¶54 The UIM policy also has a standard reducing clause.  
The whole concept of this kind of UIM coverage combined with a 
reducing clause is for an insured to obtain "a predetermined, 
fixed level of UIM recovery that is arrived at by combining 
payments" "from all legally responsible sources."  Welin v. Am. 
Fam. Mut. Ins. Co., 2006 WI 81, ¶49-50, 292 Wis. 2d 73, 717 
N.W.2d 690 (quoting another source).  In other words, the 
insured has agreed to be paid a specific amount——first from 
other legally responsible parties, with any remaining amounts 
due coming from Acuity.  So the reducing clause functions 
consistent with the rest of the policy.   
¶55 But the majority somehow finds that payments from the 
tortfeasor's insurer should count as a reduction against only 
the per person limit.  In so doing, the majority creates 
complexity where none is found, leading it to misread the 
No.  2020AP189.bh 
 
2 
 
policy.  In the end, the insureds here do not receive a fixed 
level of UIM recovery arrived at by combining payments from all 
legally responsible sources.  Instead, they receive double what 
Shimeta's policy promises as a total payout for any one 
accident.  This may be good for Shimeta's estate and his injured 
passenger, but it is not what the policy provides.  I 
respectfully dissent.1 
I.  THE POLICY 
¶56 We begin with the policy language.2  The declarations 
page of the policy summarizes the coverage Shimeta purchased.  
Multiple coverages are listed in the standard way, as providing 
a certain payout for "Each Person" and a second amount for "Each 
Occurrence" or "Each Accident."  For example, Shimeta purchased 
uninsured motorist coverage for bodily injury in the amount of 
$500,000 per person and $500,000 per accident.  And as relevant 
here, the UIM coverage is "$500,000 Each Person" and "$500,000 
Each Accident."   
                                                 
1 I understand Chief Justice Ziegler's dissent to make 
largely the same arguments I present here, and therefore I 
substantially agree with it. 
2 Because insurance policies are contracts, our primary goal 
in interpreting them is "to give effect to the intentions of the 
parties."  Wadzinski v. Auto-Owners Ins. Co., 2012 WI 75, ¶11, 
342 Wis. 2d 311, 818 N.W.2d 819.  "The parties' intentions are 
presumed to be expressed in the language of the policy."  Id.  
We therefore begin the inquiry with the policy's language.  See, 
e.g., Secura Ins. v. Lyme St. Croix Forest Co., LLC, 2018 
WI 103, ¶17, 384 Wis. 2d 282, 918 N.W.2d 885.  "Generally, we 
interpret a policy's terms as they would be understood from the 
perspective of a reasonable person in the position of the 
insured."  Id. 
No.  2020AP189.bh 
 
3 
 
¶57 The relevant policy language in the UIM endorsement 
comes under the bolded3 heading "Limits of Liability" and 
provides in relevant part: 
1.  The Limit of Liability shown in the Declarations 
for each person for Underinsured Motorists coverage is 
our maximum limit of liability for all damages, 
including damages for care, loss of service or death, 
arising out of bodily injury sustained by any one 
person in any one accident.  Subject to this limit for 
each person, the Limit of Liability shown in the 
Declarations 
for 
each 
accident 
for 
Underinsured 
Motorists coverage is our maximum limit of liability 
for all damages for bodily injury resulting from any 
one accident. 
This is the most we will pay regardless of the number 
of: 
a. Insured persons; 
b. Claims made; 
c. 
Vehicles 
or 
premiums 
shown 
in 
the 
Declarations; or 
d. Vehicles involved in the accident. 
2.  The limit of liability shall be reduced by all 
sums: 
a. Paid because of the bodily injury by or on 
behalf of persons or organizations who may be 
legally responsible.  This includes all sums paid 
under Part I – Liability; and 
b. Paid or payable because of the bodily injury 
under any of the following or similar law:  
(1) Workers' compensation law; or  
(2) Disability benefits law. 
 
                                                 
3 Following our style guide, bolded terms in the policy are 
underlined in this dissent. 
No.  2020AP189.bh 
 
4 
 
¶58 Several observations are in order.  This entire 
section uses the phrase "limit of liability" throughout.  
Paragraph 1 uses that phrase four times, and refers back to the 
amount itemized in the declarations.  The policy explains that 
the most an insurer will pay, called the "maximum limit of 
liability," will turn on the policy coverages purchased and the 
number of insureds entitled to payment for a single accident.  
One limit is governed by the "each person" coverage amount 
purchased.  And the "each accident" limit is the maximum limit 
Acuity will pay for bodily injury "resulting from any one 
accident."  This means that when two or more persons are injured 
in one accident, the "each accident" limit could, depending on 
the policy purchased, operate as a cap that limits the recovery 
for any one insured.  And if that wasn't plain enough——because 
that pattern is how this whole policy operates——the paragraph 
doubles down and declares that no matter how many insured 
persons are injured, claims are made, or vehicles are involved 
or covered, the per accident limit is "the most we will pay 
regardless."   
¶59 This UIM coverage, then, works together as a seamless, 
integrated, perfectly understandable whole.  If this were a 
$100,000 per person, $300,000 per accident policy, for example, 
the per person limit might be the more commonly applicable 
limit, and the per accident limit reached less often.  But this 
is a $500,000 per person and $500,000 per accident policy.  So 
here, the per accident limit may come into play more often than 
a policy with a different mix of coverages.  While the coverage 
No.  2020AP189.bh 
 
5 
 
purchased and nature of an accident will dictate how the math 
works, the policy will always have a definitive maximum limit of 
liability——a dollar figure that serves as a cap on Acuity's 
liability.  This limit need not be one or the other.  For 
example, in this $500,000 per person and per accident policy, 
where one insured is injured in the same accident, the "limit of 
liability" is $500,000.  There's no need to choose between the 
two limits.  The point is, there will always be a fixed dollar 
amount that is the most Acuity will pay, however it is 
calculated.   
¶60 This can be seen in a straightforward way in the same 
page of the policy as the "Limits of Liability" section.  The 
UIM policy provides that other applicable insurance coverage 
could likewise reduce the amount owed.  Under paragraph 3 of the 
"Other Insurance" section, the policy says its obligation to pay 
primary or excess coverage will extend to "our limit of 
liability" under the policy.  In other words, the policy 
understands there will always be a fixed dollar "limit"——phrased 
in the singular——that will be owed to the insured.  Whether that 
limit will be established by the per person limit or the per 
accident limit will again depend on the coverages purchased and 
the number of insureds that are injured in any one accident.   
¶61 Turning to the reducing clause in paragraph 2 of the 
"Limits of Liability" section, it too employs the same language 
as paragraph 1.  It refers to the "limit of liability."  And we 
already know what that phrase means:  it is the most Acuity will 
pay, whether determined by the per person or per accident limit 
No.  2020AP189.bh 
 
6 
 
(or both if identical), depending on the chosen coverages and 
number of injured persons.  And the reducing clause says that 
this limit "shall be reduced by all sums" paid by someone or 
some 
entity 
"who 
may 
be 
legally 
responsible"——like 
the 
tortfeasor who caused the accident in this case.4   
¶62 Applying the policy is straightforward.  The reducing 
clause operates to reduce Acuity's liability under its policy, 
whatever that limit might be.  In this case, the tortfeasor's 
insurer paid $500,000 in combined payments to Shimeta's estate 
and the passenger in his car; both are insureds under the policy 
seeking coverage for bodily injury resulting from one accident.  
And since Acuity agreed to pay no more than $500,000 for any one 
accident under the terms of this particular policy, Acuity's 
"limit of liability" is reduced per the reducing clause to zero. 
¶63 A reasonable insured would not be confused by any of 
this.  It is exactly how this UIM policy is designed to work.  
Shimeta bargained and paid for this precise level of coverage.  
Once again, the whole point of this type of "limits-to-limits" 
UIM policy is to "put the insured in the same position he or she 
would have occupied had the tortfeasor's liability limits been 
the same as the UIM limits purchased by the insured."5  Welin, 
                                                 
4 The policy further says that it shall be reduced by 
anything paid or payable under workers compensation law, 
disability benefits law, or any similar law. 
5 If the tortfeasor in this case had the liability limits 
Shimeta 
purchased——$500,000 
per 
person 
and 
$500,000 
per 
accident——then Shimeta and his passenger would have received the 
same thing they were given here:  $500,000 total.  That's why 
Shimeta's estate already received exactly what he originally 
bargained for. 
No.  2020AP189.bh 
 
7 
 
292 Wis. 2d 73, ¶26.  The policy self-consciously offers "a 
predetermined, fixed level of UIM recovery that is arrived at by 
combining payments from all sources."  Id., ¶49. The reducing 
clause ensures that the insureds receive only the fixed sum they 
bargained for.  Nothing more, nothing less.  It does this by 
promising to pay up to the limit of liability, minus payments 
from other responsible parties or under other relevant laws 
providing compensation.6   
II.  THE MAJORITY'S MISTAKES 
¶64 The majority, however, misses all of this and designs 
a more generous insurance policy than the one Shimeta bargained 
for.  The majority begins its analysis of the reducing clause by 
rightly focusing on the phrase "limit of liability."  Majority 
op., ¶23.  But instead of interpreting that phrase consistent 
with the rest of the policy, the majority proclaims itself 
stumped.  So it hypothesizes four possibilities for what it 
could mean.  The majority reasons "Limit of liability" could 
refer to:  "(1) both the 'each person' and the 'each accident' 
limit; (2) either the 'each person' or the 'each accident' limit 
depending on the facts of the case; (3) only the 'each person' 
limit; or (4) only the 'each accident' limit."  Id., ¶24. 
                                                 
6 In fact, the policy provides that Acuity "will not make a 
duplicate payment under this coverage for any element of loss 
for 
which 
payment 
has 
been 
made 
by 
or 
on 
behalf 
of 
persons . . . who may be legally responsible."  The majority's 
conclusion results in exactly the type of duplicate payment the 
policy prohibits. 
No.  2020AP189.bh 
 
8 
 
¶65 The majority first rejects the idea that both limits 
are referred to because the reducing clause uses the singular 
"limit of liability."  Id., ¶¶25-26.  Moving on to option two, 
the majority explains that it can't be right either because 
"neither paragraph 1 nor the reducing clause actually say that 
the limit of liability to be reduced changes depending on the 
number of injured insureds."  Id., ¶27.  Except that it does.  
Paragraph 1 immediately preceding the reducing clause uses 
"limit of liability" in the singular for both, and explicitly 
says 
that 
the 
"maximum 
limit 
of 
liability 
for 
all 
damages . . . resulting from any one accident" supersedes the 
per person limit.  The per accident limit is the maximum Acuity 
"will pay regardless of the number of . . . Insured persons" who 
are injured and entitled to recovery.   
¶66 The majority then postulates a reasonable insured is 
simply not going to understand which limit applies.  Majority 
op., ¶28.  I suppose it's true that few insureds truly grasp how 
their policies work.  Insurance policies tend not to be evening 
reading material for most people.  But this isn't rocket 
science, and a reasonable insured wouldn't be confused.  Shimeta 
bargained for a maximum recovery defined as $500,000 per person, 
and at most, $500,000 per accident regardless of the number of 
injured persons.  The entire policy issued to Shimeta, including 
standard liability insurance, uninsured motorist coverage, and 
the UIM endorsement contain the same structure.  Under the 
majority's logic, reasonable people just can't understand what 
it means for a policy to have a maximum dollar limit (the "limit 
No.  2020AP189.bh 
 
9 
 
of liability") that can vary depending on coverages purchased 
and the facts of a case.     
¶67 The majority compounds its errors by positing that 
since the "limit of liability" in the reducing clause is 
singular, it can only refer to "one particular limit of 
liability, rather than both limits or either limit."  Id., ¶30.  
It then concludes we must choose the "each person" limit because 
that 
harmonizes 
the 
definition 
with 
the 
definition 
of 
underinsured motor vehicles.  Id., ¶31.  Since caselaw, rather 
than a definition in the policy, establishes that a vehicle is 
underinsured, the majority concludes we must read it the same 
way.  Id., ¶32.  Finally, the majority misconstrues the policy 
further by saying that because the reducing clause uses the 
phrase "the bodily injury" in the singular, it should be 
understood as reducing payments only for a singular insured's 
per person coverage.  Any other proposed reading of "limit of 
liability" or "the bodily injury" would be ambiguous, the 
majority reasons, and therefore read in favor of the insured.  
Id., ¶¶33, 35.  None of this correct.   
¶68 First, neither basic grammar nor logic dictate that 
because "limit of liability" is used in the singular, only one 
of the two possible limits must be referred to.  Rather, the 
policy is consistent that there will always be a maximum dollar 
limit to Acuity's liability depending on the coverages purchased 
for per person and per accident, and depending on the facts of 
the case.   
No.  2020AP189.bh 
 
10 
 
¶69 Second, the majority's emphasis on "the bodily injury" 
is likewise atextual.  The policy always uses "bodily injury" in 
the singular and bolded.  This is because "bodily injury" is a 
defined term in the policy referring to a type of damage that 
triggers liability and coverage.  The policy does the same thing 
with "property damage"——another type of damage that may be 
covered in the policy and is separately defined.  Both here and 
throughout the rest of the policy, even where two or more 
insured persons are injured, the phrase "bodily injury" is 
always bolded and used in the singular.  The majority's emphasis 
on the definite article "the" does not transform this standard 
definition-invoking language into a clue that the reducing 
clause is meant to operate in a way totally divorced from the 
entire operation of this fixed coverage UIM policy.   
¶70 Finally, the majority puts too much stock in the fact 
that whether underinsurance is triggered looks only to the per 
person limit.  Acuity agrees based on a court of appeals 
decision that the tortfeasor's limit should be compared with the 
policy's per person limit for purposes of answering the initial 
question of whether the policy is triggered.  See Filing v. Com. 
Union Midwest Ins. Co., 217 Wis. 2d 640, 649-50, 579 N.W.2d 65 
(Ct. App. 1998) (holding that the tortfeasor's liability limits 
should be compared with the per person limits under the policy).  
But that means little here.  The reasoning of the court of 
appeals in Filing rested less on a careful interpretation of the 
language than on its sense that the insured expected potential 
coverage apart from how many are injured in an accident.  Id.  
No.  2020AP189.bh 
 
11 
 
It also discussed the many "absurd results" that would be 
occasioned by interpreting the policy the other way.  Id. at 647 
& n.3.  While I am not suggesting the outcome was incorrect, 
Filing has little to say analytically about the question 
presented here.   
¶71 Whether Acuity must pay and in what amount is a 
different question altogether from whether UIM coverage is 
triggered in the first instance.  To determine if any portion of 
the coverage is reduced, we must look to the relevant policy 
language.  And as we've explained, paragraph 1——directly before 
the reducing clause in paragraph 2——specifically references both 
limits.  "[A] reasonable insured would understand that the 
reducing clause in [paragraph 2] of the Limit of Liability 
section 
of 
the 
UIM 
endorsement 
qualifies 
the 
insurer's 
obligation to pay the maximum limit of liability as described 
in . . . [paragraph 1]."  Ruenger v. Soodsma, 2005 WI App 79, 
¶23, 281 Wis. 2d 228, 695 N.W.2d 840.  Thus, whether UIM 
coverage is triggered in the first instance isn't doing the 
analytical work the majority thinks it is. 
III.  CONCLUSION 
¶72 While insurers can draft policies moving forward that 
satisfy the majority's perplexity, the language the majority 
misinterprets today will impact current policies across the 
state.  The majority misses the mark by trying to figure out 
which limit the phrase "limit of liability" in the reducing 
clause applies to.  The answer is apparent:  The policy 
No.  2020AP189.bh 
 
12 
 
consistently describes itself as having one maximum dollar 
limit, a "limit of liability," which could be triggered by 
either of the two limits depending on the coverages purchased 
and the facts of the case.  And the reducing clause provides 
that Acuity's liability limit must be reduced when other 
responsible parties provide compensation.   
¶73 Here, Shimeta purchased UIM coverage in the amount of 
$500,000 per person and $500,000 per accident.  An unfortunate 
accident occurred, leaving Shimeta dead and his passenger 
injured, 
both 
insureds 
under 
the 
policy. 
 
Collectively, 
Shimeta's estate and his injured passenger received $500,000 
from the tortfeasor's insurance.  The reducing clause requires 
that this $500,000 be deducted from Acuity's limit of liability, 
which under these facts and this coverage is $500,000 for this 
one accident.  Therefore, the predetermined, fixed sum Shimeta 
bargained for was paid out, and Acuity has no further liability 
under the policy.  I respectfully dissent. 
¶74 I am authorized to state that Justice REBECCA GRASSL 
BRADLEY joins this dissent. 
 
No.  2020AP189.bh 
 
 
 
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