Opinion ID: 1390684
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Heading Rank: 3

Heading: Stacking of Policies

Text: Stacking, in connection with uninsured motorist coverage, refers to the right to recover on two or more policies in an amount not to exceed the total of the limits of liability of all policies up to the full amount of the damages sustained. In Sturdy v. Allied Mutual Ins. Co., supra, we permitted stacking of uninsured motorist coverage on two automobiles insured in the same policy when the insured was injured while riding a non-owned motorcycle. Defendant argues the facts in Sturdy are distinguishable from the case at bar, emphasizing that here Van Hoozer was occupying one of the insured vehicles (the Jaguar), and not a non-owned vehicle. Reference is made to definitions in Part II of the Volkswagen policy: The definitions under Part I, except the definition of `insured', apply to Part II, and, in addition, the following definitions also apply: (1) Insured. The unqualified word `insured' means: (a) the named insured or a relative (i) while occupying the described automobile or a non-owned automobile, provided the actual use of such automobile is with the permission of the owner, or (ii) if struck by an uninsured motor vehicle while not occupying any other motor vehicle; ... Defendant concedes coverage under the Jaguar policy, but claims the Volkswagen policy affords no coverage to Van Hoozer because when he received his fatal injuries he was not occupying the insured Volkswagen nor was he occupying a non-owned automobile with the permission of the owner. In short, defendant maintains Van Hoozer was not an insured under the policy covering the Volkswagen. Plaintiff claims this argument is in conflict with the uninsured motorist coverage required by the mandatory statute in that the policy provisions attempt to condition, limit, or dilute the uninsured motorist coverage provided in the statute. ( Clayton v. Alliance Mutual Casualty Co., supra.) Plaintiff also relies on the ruling in Forrester v. State Farm Mutual Automobile Ins. Co., supra, wherein we said: We hold that plaintiff as an insured under the policy is an insured within the meaning of the statute and that the exclusion operates to annul the coverage mandated therein, thus, the exclusion is void with respect to a person in plaintiff's position. We do not determine herein the limits of the power of defendant, within statutory authority, to predetermine who is to be an insured. Our holding is limited to the facts herein that where an insured, in an insured automobile, is injured by an uninsured motorist the coverage mandated by the statute precludes his exclusion. (pp. 451, 452.) In both Clayton and Forrester we were dealing with exclusionary clauses while here defendant relies on policy definitions of the insured. Plaintiff argues this is an attempt to accomplish indirectly that which, according to Forrester, is prohibited by the statute. Also, she argues that defendant, by a process of step-by-step refinement of the definition of insured, is excluding from coverage those who are otherwise insureds within the meaning of the statute, including the named insured. Plaintiff points out that Thomas H. Van Hoozer was the named insured in the declarations sheets of both policies. The policies extended uninsured motorist coverage to the insured and did not expressly indicate that a named insured might not be the insured under certain circumstances. The definition of insured as interpreted by defendant by a process of elimination or exclusion, would not include the insured while occupying an automobile other than the described automobile or a non-owned automobile. Thus, defendant has attempted to accomplish by way of a restrictive definition of the term insured what was prohibited in Forrester. We conclude the position taken by this court in Clayton and Forrester is consistent with the argument advanced by plaintiff. Although we stated in Forrester that an insurer has the right to predetermine who is to be an insured, a definition in a policy cannot be so confining that a named insured can be eliminated as an insured under the policy. Thomas H. Van Hoozer, being a named insured in both policies, was the insured within the mandate of the statute. Defendant also argues stacking should not be permitted by reason of the language found in Condition 7 of the policy, which reads: (7) OTHER INSURANCE IN THE COMPANY With respect to any occurrence, accident or loss to which this and any other insurance policy or policies issued to the insured by the Company also apply, no payment shall be made hereunder which, when added to any amount paid or payable under any such other insurance policy or policies, would result in a total payment to the insured or any other person in excess of the highest applicable limit of liability under any one such policy. Defendant contends the foregoing language is clear and unambiguous as to the intention of the parties with respect to stacking of coverage and should be given effect. We considered a similar provision in Clayton and concluded that such clause is void and of no effect, as being in violation of the plain terms of the statute. (p. 650.) The rationale of Clayton was based on the following language from Van Tassel v. Horace Mann Mutual Ins. Co., 296 Minn. 181, 207 N.W.2d 348 (1973): It seems to us that, in spite of the attempt by the insurer to limit its liability to one policy or to the amount recoverable under one policy, the fact that the legislature required an uninsured-motorist provision in all policies, added to the fact that a premium has been collected on each of the policies involved, should result in the policyholder's receiving what he paid for in each policy, up to the full amount of his damages. It is true that such holding results in permissible recovery exceeding what he would have received if the uninsured motorist had been insured for the minimum amount required under our Safety Responsibility Act. But if the question must be resolved on the basis of who gets a windfall, it seems more just that the insured who has paid a premium should get all he paid for rather than that the insurer should escape liability for that for which it collected a premium. (p. 187.) In the instant case, Van Hoozer paid for two separate uninsured motorist coverages. It is only fair that plaintiff be permitted to recover under both policies. Accordingly, we hold the trial court did not err in allowing the stacking of the two policies.