Opinion ID: 2635588
Heading Depth: 1
Heading Rank: 10

Heading: Allowing recovery of underinsured benefits under the facts presented in this case coheres with the purpose of uninsured/underinsured motorist coverage

Text: This court has stated that the purpose of uninsured/underinsured motorist coverage is to compensate the insured for damages based upon the tort liability of the uninsured, underinsured, or hit-and-run driver. St. Paul Fire v. Employers Ins. Co. of Nev., 122 Nev. 991, 993, 146 P.3d 258, 260 (2006). Allowing a passenger to recover both liability and underinsured motorist benefits under a single policy of insurance in this situation is consistent with the purpose of uninsured/underinsured motorist coverage, as the passenger is being compensated for damages caused by the joint negligence of an uninsured/underinsured driver. Various insurance treatises, while they are persuasive authority only, provide comprehensive explanations on uninsured/underinsured motorist benefits. For example, [a]s a general rule, a passenger who has made a liability recovery under [the permissive driver's] policy may also make an underinsured motorist recovery under the same policy where a second negligent vehicle involved in the accident was underinsured. 3 Irvin E. Schermer & William J. Schermer, Automobile Liability Insurance § 39:12 (4th ed.2004). Despite the language in the permissive driver's liability policy excluding the vehicle the permissive user is driving from being deemed underinsured, it is the jointly liable tortfeasor's lack of adequate liability coverage which is the pivotal factor in allowing recovery for underinsured motorist benefits. Id. Likewise, passenger-claimants are entitled to recover both under a bodily injury liability coverage and an uninsured motorist coverage included in the same insurance policy... when ... [the] passenger [is] in an insured automobile and is injured in an accident with an uninsured motorist that is caused by the negligence of both drivers. 1 Alan I. Widiss & Jeffrey E. Thomas, Uninsured and Underinsured Motorist Insurance § 14.6 (3d ed.2005). Because the insurance company is liable to the passenger under the liability provision of the policy for the insured driver's negligence, the passenger may recover liability benefits. Id. And because the other motorist was jointly negligent and underinsured, and the passenger is generally defined as an insured under the uninsured/underinsured motorist policy, the policy extends coverage to occupants of the insured vehicle. See id. Therefore, the insured passenger may recover uninsured/underinsured motorist benefits. Id. Moreover, other courts addressing this issue have determined that a guest passenger may recover for another driver's negligence under his or the permissive driver's uninsured or underinsured motorist policy and recover for the permissive driver's negligence as a third-party claimant. See, e.g., Dairyland Ins. Co. v. Bradley, 192 W.Va. 199, 451 S.E.2d 765 (1994). In Dairyland Insurance Co. v. Bradley , the mother of a passenger who perished when the motorcycle on which she was riding collided with another vehicle sought recovery for her daughter's death under both the liability and underinsured motorist provisions of the motorcycle driver's policy. Id. at 765. The accident resulted from the concurrent negligence of both the motorcycle driver and the other driver. Id. After exhausting the liability limits of the motorcycle driver's and the other driver's policies, the estate of the deceased passenger sought to recover underinsured motorist benefits under the motorcycle driver's policy. Id. at 766. Thus, similar to the facts presented in this case, the passenger was attempting to recover underinsured motorist benefits based on the other driver's negligence and underinsured status. See id. In rejecting the insurance company's argument that a guest passenger could not recover both liability and underinsured motorist benefits under a single policy of insurance, the Dairyland court held that when the [permissive] driver's policy language specifically provides coverage of a guest passenger as insured, a guest passenger who is injured by the concurrent negligence of the [permissive] driver and a third party may recover under the [permissive] driver's underinsured motorist insurance if the limits of liability of the third-party tortfeasor are such as to make him an underinsured motorist within the contemplation of the [permissive] driver's underinsured motorist policy. Id. at 768. The court reasoned that while such passengers are precluded from recovering underinsured benefits based on the permissive driver's negligence  i.e., when the permissive driver's policy excludes the permissive driver's vehicle from being deemed underinsured  a passenger could recover underinsured motorist benefits for injuries caused by a jointly negligent and underinsured motorist involved in the accident when the permissive driver's policy language extended coverage to that passenger. Id. at 767-68. Pursuant to the express language of the motorcycle driver's insurance policy, the guest passenger was deemed an insured. Id. As a result, the Dairyland court permitted the insured passenger's estate to recover both liability and underinsured motorist benefits, stating that the limits of liability of the third-party tortfeasor are such as to make him an `underinsured motorist' within the contemplation of the motorcycle driver's underinsured motorist policy, after determining that the guest passenger was injured by the concurrent negligence of the motorcycle driver and the other driver. Id. at 768. Other courts have similarly reasoned that the prohibition against stacking policies is not implicated when a passenger seeks to recover liability and uninsured/underinsured motorist benefits when his or her injuries are attributable to joint tortfeasors and the other driver is uninsured or underinsured. See, e.g., Woodard v. Pa. Nat. Mut. Ins. Co., 534 So.2d 716, 721 (Fla.Dist.Ct.App.1988) (explaining that because the passenger was attempting to collect uninsured motorist benefits based on the other driver's concurrent negligence and uninsured status, the passenger was not attempting to impermissibly stack the uninsured motorist and liability coverages); Lahr v. American Family Mut. Ins. Co., 528 N.W.2d 257, 260 (Minn.Ct.App. 1995) (stating that when a vehicle other than the one in which the passenger is riding is potentially at fault, the prohibition against converting the passenger's driver's [underinsured motorist] coverage into liability coverage is not applicable since it is the other vehicle's lack of sufficient liability coverage [that] triggers the passenger's claim for [underinsured motorist] benefits from her driver's insurer); cf. Casson v. Dairyland Ins. Co., 400 So.2d 713, 716 (La.Ct.App.1981) (noting that a guest passenger can recover against [the permissive] driver under the liability coverage on the [permissive driver's] vehicle and also against the driver of another vehicle under the uninsured motorist coverage on the [permissive driver's] vehicle). Applying this rationale to the facts of this case, we conclude that if Marcelino and Dean are adjudged jointly negligent, the Delgados can recover under Marcelino's underinsured motorist policy for Dean's negligence and the Dean vehicle's underinsured status. Under Marcelino's policy, Dionicia was a lawful occupant of Marcelino's vehicle; therefore, the policy extended underinsured motorist coverage to Dionicia at the time of the accident. Although Marcelino's vehicle could not qualify as an underinsured vehicle under the terms of the policy, the Dean vehicle could. If the Delgados can prove that Dionicia is legally entitled to recover damages from Dean, they may recover the amount of excess damages under Marcelino's underinsured motorist policy with American Family. Therefore, we conclude that American Family was not entitled to judgment as a matter of law and reverse the district court's grant of summary judgment.