Opinion ID: 1289083
Heading Depth: 1
Heading Rank: 6

Heading: uim policy exclusions

Text: Kathie argues on appeal that she is entitled to UIM coverage for two reasons: (1) She had a reasonable expectation of UIM coverage under the provisions of the policy, and (2) insofar as the policy may be interpreted as excluding coverage, it is contrary to the Uninsured and Underinsured Motorist Insurance Coverage Act (UUMICA). [6] The UUMICA defines the required uninsured motorist (UM) and UIM coverage, the minimum amount of liability, and some exclusions to coverage. [7] Insurers may not issue policies that carry terms and conditions less favorable to the insured than those provided in the UUMICA. [8] In construing a statute, a court must determine and give effect to the purpose and intent of the Legislature as ascertained from the entire language of the statute considered in its plain, ordinary, and popular sense. [9] Section 44-6408 of the UUMICA states that all automobile liability insurance policies issued with respect to any motor vehicle principally garaged in this state shall provide for protection of persons insured who are legally entitled to recover compensatory damages for bodily injury, sickness, disease, or death from . . . the owner or operator of an underinsured motor vehicle. An [u]nderinsured motor vehicle is defined broadly as a motor vehicle with respect to the ownership, operation, maintenance, or use of which there is bodily injury liability insurance . . . and the amount of the insurance . . . is less than. . . the damages for bodily injury, sickness, disease, or death sustained by the insured. [10] Certain exclusions to underinsured motor vehicle are set forth in § 44-6407, which are not applicable here. We have explained that the purpose of the UIM provisions is to give the same protection to the insured as he or she would have had if injured in an accident caused by a vehicle covered by an adequate liability policy. [11] The language of § 44-6408 is broad, specifying only that it be for persons insured who are injured by an uninsured or underinsured motorist. In § 44-6413, the UUMICA sets forth specific exclusions to this broad coverage. Section 44-6413 states that the UIM/UM coverage shall not apply when the bodily injury occurs (1) while the insured is occupying a motor vehicle owned by, but not insured by, the named insured; (2) while the insured is occupying an owned motor vehicle that is used as a public conveyance; (3) where the insured is struck by a vehicle owned by the named insured or a spouse or a relative residing with the named insured; or (4) where the statute of limitations has run on the claim. Read together, the provisions of the UUMICA mandate that unless one of the exclusions set forth in § 44-6413 applies, an insured is entitled to recover for injuries sustained in any accident, so long as the injuries were caused by an [u]nderinsured motor vehicle [12] or an [u]ninsured motor vehicle. [13] It is not within the province of a court to read a meaning into a statute that is not warranted by the legislative language. [14] Other courts and authorities reading similar language have likewise concluded that unless any statutory exclusion applies, the UIM/UM coverage is to be liberally construed. [15] The general coverage provision of Progressive's policy with Jeffrey is similar in nature to the general coverage provisions set forth by § 44-6408. The policy provides that unless the policy exclusions apply, Progressive will pay for damages . . . which an insured person is entitled to recover from the owner or operator of an underinsured motor vehicle because of bodily injury: 1. sustained by an insured person; 2. caused by an accident; and 3. arising out of the ownership, maintenance, or use of an underinsured motor vehicle. (Emphasis in original.) We agree with Kathie that the undisputed facts clearly satisfy the general coverage provisions of the policy with Progressive. Jeffrey was an insured person under the policy, and he sustained bodily injury in an accident which arose out of the use of an underinsured motor vehicle. But Progressive asserts that the exclusion provision bars Jeffrey's recovery. Progressive argues that Jeffrey's tractor was either a motor vehicle or a device of any type designed to be operated on the public roads. If this is the case, then, since the tractor was owned by Jeffrey, but was not a covered vehicle under the policy, the exclusion would apply. Kathie argues, however, that both under the policy definitions section of the contract with Progressive and under the UUMICA, a tractor is not considered a motor vehicle. To the extent that a tractor is a device of any type designed to be operated on the public roads, Kathie argues that this deviation from the exclusions specified in § 44-6413 is an impermissible reduction in the coverage mandated by the UUMICA. We agree. Where a statutory omnibus provision is in conflict with the provisions of the insurance policy, the statute and not the policy provision is controlling. [16] As the Nebraska Court of Appeals explained in American States Ins. v. Farm Bureau Ins., [17] where the exclusions provision of a policy was broader than the exclusions set forth by the UUMICA, then the policy exclusion was void: It is obvious that an insurance company could reduce its exposure or risk by excluding coverage of certain events or conditions and that if enough exclusions are allowed, the public could receive markedly less than what the Legislature has decreed it is entitled to. With each exclusion, the insured would receive less coverage than what the Legislature has directed. . . . What possible basis could the courts have for deciding that some exclusions unauthorized by statute are valid and some not? While the UUMICA allows insurers to issue policies with terms and conditions more favorable to their insureds, they may not exclude coverage that is guaranteed by the act. [18] In other words, the exclusions provided by § 44-6413 are the only exceptions permitted to the coverage mandated by § 44-6408. Progressive's policy exclusion states: Coverage . . . is not provided for bodily injury sustained by any person while using or occupying . . . a motorized vehicle or device of any type designed to be operated on the public roads that is owned by you or a relative, other than a covered vehicle (emphasis omitted). Section 44-6413(b) of the UUMICA states that coverage shall not apply to [b]odily injury, sickness, disease, or death of an insured while occupying a motor vehicle owned by, but not insured by, the named insured or a spouse or relative residing with the named insured. Both provisions state that if the insured is injured in a vehicle that the insured or a family member could have insured, but did not, then there will be no coverage when that insured is injured by an uninsured or underinsured motorist. But the language of the policy and the UUMICA diverges with respect to whether a farm tractor is a device included within this exemption. Under the UUMICA, the exemption is triggered by a motor vehicle which is owned by, but not insured by, the named insured or relative residing with the named insured. Section 44-6404 incorporates the definition of motor vehicle provided by Neb.Rev.Stat. § 60-501(4) (Reissue 2004): any self-propelled vehicle which is designed for use upon a highway, including trailers designed for use with such vehicles, except. . . (d) farm tractors. Progressive's policy does not specifically exclude a tractor as a motor vehicle. But the policy states in relevant part that the term motor vehicle means a land motor vehicle of the private passenger, pickup body, or cargo van type . . . designed for operation principally upon public roads. Progressive argues that this definition of motor vehicle includes tractors and that in any event, a tractor is a device of any type designed to be operated on the public roads. Therefore, Progressive contends, a tractor is a vehicle or device that must be specifically covered if owned by the insured or a resident family member. Section 60-501, by specifically excluding farm tractors from the definition of motor vehicle, trumps any definition in Progressive's policy to the contrary. Progressive's policy definition of a farm tractor as a motor vehicle is, therefore, an attempt to make the policy exclusion broader than the statutory definition in § 44-6413(b) and is void. [19] Accordingly, the district court erred in granting summary judgment on the ground that Jeffrey's tractor fell under the exclusions provision of the Progressive policy. We turn now to whether the court was correct in granting summary judgment on the alternative ground that Kathie had violated the statute of limitations provisions of the UUMICA and the policy.