Opinion ID: 166884
Heading Depth: 2
Heading Rank: 3

Heading: Application of a $200,000 aggregate cap

Text: 34 The district court referenced State Farm's policy coverage chart and found that, like the policy in Brennan, the Madrid policy includes a $200,000 limit. Clark II, 292 F.Supp.2d at 1268-69. The district court further determined that applying the $200,000 aggregate cap is consistent with the admonition that a reformed insurance policy express the parties' true intent. Id. at 1269. Mr. Clark now argues that the district court erred in applying the $200,000 limit. 35 Subsection 710(2)(b) of CAARA states that [a] complying policy may include a $200,000 aggregate limit for all benefits set forth in subsections 706(1)(b) to (1)(e) on account of injury to or death of any one person from a vehicle accident. The policy in Brennan included an endorsement specifically providing an aggregate limit for medical expenses, rehabilitation expenses, work loss, essential services, and death compensation. 961 P.2d at 555. The Colorado Court of Appeals in Brennan relied on the policy's plain terms and imposed a $200,000 limit on total PIP benefits payable. Id. Thompson makes clear, however, that when an insurer does not include an aggregate cap in the policy agreement, the insurer cannot take advantage of the possible cap. 940 P.2d at 991. 36 The parties agree that the Madrid policy's declarations page indicates selection of P1 coverage. Aplt's App. vol. II, doc. 20, at 6. Mr. Clark disputes application of the $200,000 aggregate cap to P1 coverage and contends that such a cap applies only to coverage options that the Madrids did not select. He further maintains that State Farm expressly chose not to include an aggregate cap for P1 coverage even though it easily could have. According to State Farm, it would be meaningless to note such an explicit limit to P1 coverage because P1 benefits can never exceed $200,000. State Farm maintains that the Madrid policy evidences an intent to include the aggregate limit to its fullest possible extent by capping all levels of PIP coverage that could exceed $200,000. 37 The Madrid policy's schedule does not list an aggregate limit for coverage at the P1 level. Other coverage symbols provide higher wage-loss benefits and explicitly specify a $200,000 aggregate limit. See id. at 18. We agree with State Farm that P1 coverage, however, could never reach a $200,000 aggregate cap given its respective payment limits for (1) medical expenses ($50,000), (2) rehabilitation expenses ($50,000), (3) wage-loss benefits (52 weeks of payments, up to a weekly rate of $400, for a maximum of $20,800), (4) essential services (364 days, up to a daily rate of $25, for a maximum of $9,100), and (5) death compensation ($1,000). P1 coverage can only pay up to $130,900 in benefits. 38 Furthermore, the Madrid policy clearly caps all coverage levels that could exceed $200,000. See Aplt's App. vol II, doc. 20, at 18 (providing a cap of $200,000 for PIP benefits payable at the P4, P8, P9, and P10 levels). On its policy schedule, State Farm need not specifically include a $200,000 aggregate limit under the P1 coverage symbol when such basic coverage cannot possibly provide PIP benefits exceeding that amount. See Breaux v. Am. Family Mut. Ins. Co., 387 F.Supp.2d 1154, 1165 (D.Colo.2005) (applying a $200,000 aggregate limit to a policy with similar coverage for medical expenses, rehabilitation expenses, lost wages, essential services, and death compensation because [s]imple addition will show that the maximum benefit available under the mandatory minimum PIP coverage is $130,900, patently within the $200,000 aggregate limit). Thus, we agree with the district court that the Madrid policy's $200,000 aggregate limit applies to benefits under the reformed policy.