Opinion ID: 171942
Heading Depth: 4
Heading Rank: 1

Heading: Claim for Declaratory Relief and Reformation

Text: The complaint’s first cause of action sought, among other things, a declaration that United Fire failed to properly offer enhanced PIP benefits under § 10-4-710. 1 Before its repeal, the CAARA required that automobile insurance policies include certain minimum or basic PIP benefits to compensate injured persons for medical and rehabilitative expenses and lost wages resulting from automobile accidents. See § 10-4-706(1)(a)-(e). The CAARA also required an insurer to offer, in exchange for higher premiums, two types of added or enhanced PIP coverage. The first type was enhanced PIP medical-expense coverage which was essentially basic PIP medical-expense coverage without that coverage’s dollar or time limitations. See § 10-4-710(2)(a)(I). The second type of enhanced PIP coverage, and the type Mr. Lopez claimed should have been offered to Pueblo Sanitation, consisted of the enhanced PIP medical-expense coverage plus an enhanced PIP lost-income coverage. § 10-4-710(2)(a)(II). 1 All statutory cites are to Colorado Revised Statutes, unless otherwise specified. This court has utilized the 2002 version of the CAARA, Colo. Rev. Stat. §§ 10-4-701 through 726 (repealed July 1, 2003), because the United Fire policy in question was issued in 2002 and Mr. Lopez’s accident occurred that year. The CAARA, which prior to repeal governed the sale of automobile insurance in Colorado, was enacted by the Colorado legislature in 1973 for the purpose of avoiding inadequate compensation to victims of automobile accidents. See Reid v. Geico Gen. Ins. Co., 499 F.3d 1163, 1165 (10th Cir. 2007). -3- Under Colorado law, when an insurance company has violated the CAARA by failing to offer enhanced PIP coverage, the legal remedy is to reform the policy to include that coverage. 2 Clark v. State Farm Mut. Auto. Ins. Co., 319 F.3d 1234, 1241 (10th Cir. 2003) (“‘[W]hen . . . an insurer fails to offer the insured optional coverage that satisfies [the CAARA], additional coverage in conformity with the offer mandated by statute will be incorporated into the policy.’”) (quoting Brennan v. Farmers Alliance Mut. Ins. Co., 961 P.2d 550, 554 (Colo. App. 1998)) (ellipsis and emphasis in original). Mr. Lopez therefore asked the district court to reform the policy to include the enhanced PIP coverage described in § 10-4-710(2)(a)(II), from the date of issuance. 3