Opinion ID: 1241755
Heading Depth: 1
Heading Rank: 2

Heading: Having their cake ... and eating it, too

Text: The majority opinion, as well as Russell v. State Automobile Mutual Insurance Co., 188 W.Va. 81, 422 S.E.2d 803 (1992) and its other progeny, are fundamentally flawed because they ignore the statutory basis for un- and under-insured motorist coverage. Because this Court chooses to ignore the statutory basis for the coverage, insurance companies also continue to ignore the statutory basis, and make a ton of money in the confusion. What I mean is this: the Legislature requires that (a) each automobile insurance policy contain (b) un- and under-insured motorist coverage for each person insured by the policy. However, based upon this Court's opinions, insurance companies like State Farm make (a) each automobile insurance policy contain (b) un- and under-insured motorist coverage for each vehicle insured by the policy, but (c) only pay benefits to each person insured by the policy. In other words, insurance companies charge premiums on a per-car basis, but pay claims on a per-person basis. They ignore the law when it comes to taking money, and follow the law when it comes to paying it out, and make a tidy profit on the difference. In the instant case, State Farm sold two separate insurance policies on two separate cars. The policyholders paid premiums on each vehicle. State Farm did give the policyholders a multi-car discounta whopping $1.21 for every 6 months worth of coverage on each car. When the policyholders tried to collect the coverage available under both policies, State Farm only paid the maximum amount available under one policy$20,000 per person. State Farm got its money on a per-vehicle basis, but paid out policy proceeds on a per-person basis. West Virginia law requires every insurance company, in every automobile insurance policy, to include uninsured motorist coverage. The law also requires every insurance company to offer the consumer the right to purchase underinsured motorist coverage. Un- and under-insured motorist coverage is not designed to protect the automobileit is specifically designed to protect responsible insurance consumers, their families, and their passengers. W.Va.Code, 33-6-31(b) requires every insurance policy to contain coverage to pay the insured all sums which he shall be legally entitled to recover as damages from the owner or operator of an uninsured motor vehicle[.] (Emphasis added.) The statute also requires every insurance policy to contain an option for the policyholder to purchase coverage to pay the insured all sums which he shall be legally entitled to recover as damages from the owner or operator of an ... underinsured motor vehicle[.] (Emphasis added.) The term insured is defined by W.Va. Code, 33-6-31(c) in the following manner (with emphasis added): As used in this section, ... the term insured shall mean the named insured and, while resident of the same household, the spouse of any such named insured and relatives of either, while in a motor vehicle or otherwise, and any person, except a bailee for hire, who uses, with the consent, expressed or implied, of the named insured, the motor vehicle to which the policy applies or the personal representative of any of the above[.] W.Va.Code, 33-6-31(b) and (c), read together, requires the insurance company to provide un- and under-insured motorist coverage, not for each motor vehicle owned by the named insured, but instead for the named insured, his or her resident spouse, and the relatives of either who reside in their household, while in a motor vehicle or otherwise. The statute is not intended to bolster the profits of an insurance company by requiring coverageand therefore, premiums be paidfor each vehicle. The Legislature could have tied un- and under-insured motorist coverage in all instances to the vehicle insured under the automobile policy; it did not, and instead chose to tie coverage to the named insured, his or her spouse, and their relatives residing in their household, whether in a motor vehicleany motor vehicleor otherwise. Somehow, this Court has overlooked W.Va. Code, 33-6-31(c), and repeatedly allowed insurance companies to require policyholders to pay for coverage on a per vehicle basis (with, of course, a multi-car discount). Then, when the policyholder needs to use the coverage, the insurance company points to language in the policy prohibiting stacking in essence, contractually limiting the coverage to a once-per-person form of coverage. The policyholder pays premiums for multiple cars, but only gets one coverage per person insured. When the Legislature added un- and underinsured motorist coverage to W.Va.Code, 33-6-31(b), it created a simple-to-understand public policy of full indemnification: the preeminent public policy of this state in uninsured or underinsured motorist cases is that the injured person be fully compensated for his or her damages not compensated by a negligent tortfeasor, up to the limits of the uninsured or underinsured motorist coverage. State Auto. Mut. Ins. Co. v. Youler, 183 W.Va. 556, 564, 396 S.E.2d 737, 745 (1990). This Court bluntly stated in Youler that [a]ntistacking language in an automobile insurance policy which is applicable purportedly to uninsured or underinsured motorist coverage strikes at the heart of the purpose of the uninsured and underinsured motorist statute and conflicts with the spirit and intent of such statute, in that antistacking language thwarts the statutorily stated public policy of full indemnification. 183 W.Va. at 564-565, 396 S.E.2d at 745-746. Somehow, in Russell v. State Auto and its progeny (including the majority opinion), this fundamental principle has been overlooked. The result is that policyholders buy un- and under-insured motorist coverage on each car they ownbut are then limited to only one coverage per injured person. In the instant case, I would have ruled that the anti-stacking language in the State Farm policy was void. I would also have adopted a syllabus point [1] which would roughly state that: W.Va.Code, 33-6-31(b) and (c), when read in pari materia, require insurance companies to provide, in each automobile insurance policy, uninsured and underinsured motorist coverage that will pay benefits to insureds. If an insurance company requires a policyholder to buy uninsured or underinsured motorist coverage and pay premiums on a per-vehicle basis rather than a per-insureds basis, an anti-stacking provision in the policy is void and unenforceable, and each insured should be permitted to recover the maximum coverage available for each vehicle. Insurance companies should be compelled to abide by the terms of W.Va.Code, 33-6-31either provide coverage to insureds as defined by W.Va.Code, 33-6-31(c) and charge premiums accordingly; or provide coverage (through multiple policies) for each vehicle and charge premiums accordingly. This Court should not allow insurance companies to mix the coverages and premiums. II.