Opinion ID: 1862787
Heading Depth: 2
Heading Rank: 2

Heading: Commencement of the limitations period.

Text: The next question is, upon the happening of what event does the ten-year limitations period begin to run? We again turn to the language of the Allied policy. Provisions relevant to this issue state: We will pay only after an insured's rights to the proceeds of all liability insurance bonds or policies have been determined by judgment or settlement agreement. . . . . SUIT AGAINST US We may not be sued unless all the terms of this policy are complied with. We conclude that this language imposes a condition on an insured's right to recover UIM benefits under the Allied policy, that is, that an insured must determine his or her rights to the limits of the tortfeasor's liability coverage before the insurer becomes obligated to pay UIM benefits under the policy. We further conclude, however, that the language does not specify when the ten-year limitations period begins to run. Absent specific language in the Allied policy concerning when the limitations period begins to run, we apply traditional rules regarding commencement of the contract statute of limitations to make this determination. The general rule is that the contract statute of limitations commences upon the date the contract is breached. See Diggan, 576 N.W.2d at 102. With respect to insurance policies, a breach occurs when the insurer denies an insured's request for benefits. Applying these principles to the facts of this case, we conclude that the limitations period for plaintiffs' UIM claim against Allied commenced on the date that Allied denied plaintiffs' request for UIM benefits under their Allied policy.