Opinion ID: 1415585
Heading Depth: 2
Heading Rank: 2

Heading: Beeler CaseDifferent Insurance Coverage Limits

Text: At the center of this issue of statutory interpretation is the meaning of the third event delineated in West Virginia Code § 33-6-31d which requires an insurer to offer underinsured motorist coverage to any named insured who requests different coverage limits. W.Va.Code § 33-6-31d(e). While this issue was certified with respect to both the Burrows case and the Beeler case, counsel for Ms. Burrows [21] conceded this issue in favor of Nationwide in the Burrows case. [22] Consequently, we will address this issue based on the facts presented in Beeler. Ms. Beeler contends that the changes effected in her mother's policy concurrent with her addition as a named insured to that policy in September 2000 [23] constituted the requisite change in coverage limits sufficient to obligate Nationwide to make an offer of underinsured motorist coverage. Those changes were the addition of a named insured; the addition of comprehensive and collision coverage for Ms. Beeler's 1996 Plymouth Neon vehicle; and the addition of a new covered vehicle (the Neon). With the addition of Ms. Beeler's vehicle and the selected coverages, the premium for the policy held by Mrs. Anderson was increased by $342.80 every six months. Viewing this amount as significant, Ms. Beeler maintains that this premium increase amounted to a material change which required Nationwide to issue a new policy and to make a separate offer of underinsured motorist coverage. [24] After acknowledging that the issue presented is one of statutory interpretation, Ms. Beeler quickly proceeds to suggest that [t]he only reasonable interpretation of the phrase `different coverage limits' which is consistent with the strong public policy [which] require[s] insurance companies to offer UIM [underinsured motorist] coverage is that when material changes in coverage occur, the insurer has an obligation to make UIM options forms available.... Rather than engaging in any statutory analysis, Ms. Beeler presumes that whatever interpretation imposes upon insurers the obligation to make an additional offer of underinsured motorist coverage is the correct one, given the goal of encouraging full compensation. See Youler, 183 W.Va. at 564, 396 S.E.2d at 745. As support for her position, Ms. Burrows relies on extrajurisdictional case law wherein the issue of whether underinsurance coverage had to be offered in a variety of circumstances was resolved based on whether material changes were affected to the policy at issue such that a new policy effectively resulted through the requested changes. See, e.g., Matheny v. Glen Falls Ins. Co., 152 F.3d 348 (5th Cir. 1998) (holding that addition of minor child as licensed driver with attendant 38% increase in premium materially changed risk insured and resulted in new policy); Allstate Ins. Co. v. Kaneshiro, 93 Hawai`i 210, 998 P.2d 490 (2000) (finding substitution of wife as sole named insured following divorce on policy where husband was previously sole named insured constituted material change resulting in new policy and required separate waiver of underinsurance); State Farm Mut. Ins. Co. v. Arms, 477 A.2d 1060 (Del.1984) (ruling that changes to insured vehicle and coverage amounts were material). We do not find it necessary to weigh the conflicting cases [25] which rely on the concept of material change [26] for purposes of resolving the question of statutory interpretation that is presented here. Instead, we proceed to examine the language at issue to construe the third requirement which governs the issue of when insurers are statutorily mandated to make an offer of underinsured motorist coverage. Although the terms different coverage limits appear in West Virginia Code § 33-6-31d(e), we find it necessary to refer to West Virginia Code § 33-6-31(b) for guidance on this issue, given that both of these statutes deal with the optional insurance coverage of underinsurance. Significant to our discussion is the fact that in structuring the statutory duty imposed on insurers to offer underinsurance, the Legislature expressly tied this type of optional insurance coverage to the limits of liability coverage. The option to purchase underinsurance is stated as follows in West Virginia Code § 33-6-31(b): [S]uch policy or contract shall provide an option to the insured with appropriately adjusted premiums to pay the insured all sums which he shall legally be entitled to recover as damages from the owner or operator of an ... underinsured motor vehicle up to an amount not less than limits of bodily injury liability insurance and property damage liability insurance. W.Va.Code § 33-6-31(b) (emphasis supplied). The definition of underinsurance that is statutorily provided is also framed with specific reference to liability insurance coverage: Underinsured motor vehicle means a motor vehicle with respect to the ownership, operation or use of which there is liability insurance applicable at the time of the accident, but the limits of that insurance are either: (i) Less than limits the insured carried for underinsured motorists' coverage; or (ii) has been reduced by payments to others injured in the accident to limits less than limits the insured carried for underinsured motorists' coverage. W.Va.Code § 33-6-31(b) (emphasis supplied). Nationwide argues that because the statutory definition of an underinsured motor vehicle is expressly tied to and dependent upon the existence of liability coverage, it stands to reason that the Legislature intended to directly link any alteration in liability coverage limits with the need to re-offer underinsured motorist coverage. See W.Va. Code § 33-6-31d(e). Nationwide contends that its position is bolstered by the position taken by the Insurance Commissioner in connection with the forms [27] the Commissioner has promulgated for the offering of this optional coverage. [28] At the bottom of the form is the following language: I have been given the opportunity to select the optional limits of UNDER insured motor vehicle coverage listed above and have selected the coverage that matches the box I have checked. The form ends with the notice that [t]hese limits apply until a change in limits is requested. Since the only limits of coverage that are identified on the insurance form offering the underinsured motorist coverage are limits that correspond to bodily injury and property damage liability amounts, Nationwide suggests that the Insurance Commissioner has taken the position that the statutory language which refers to different coverage limits was intended to indicate a change in liability coverage limits. W.Va.Code § 33-6-31d(e). The position advocated by Nationwide and purportedly adopted by the Insurance Commissioner is the only interpretation of West Virginia Code § 33-6-31d(e) that withstands scrutiny. Given that the statutory creation of the optional coverages of uninsured and underinsured motorist benefits has a direct nexus to the limits of bodily injury liability insurance and property damage liability insurance, [29] it logically follows that the Legislature would connect a change in liability limits with the need to redistribute the insurance form offering such optional limits of coverage. [30] Accordingly, we hold that the language contained in West Virginia Code § 33-6-31d(e) that requires insurers to offer underinsured motorist coverage to insureds upon a request for different coverage limits refers to a request for different liability coverage limits and does not refer to a request for changes in other types of coverage such as collision, comprehension, loss of use, or towing. Consequently, only changes that are requested by insureds to alter their actual liability coverage will invoke the statutory duty imposed on insurers to make underinsured motorist coverage available within the meaning of West Virginia Code § 33-6-31d(e). Based on the foregoing, we answered the first certified question in the affirmative and the second certified question in the negative. Certified questions answered.