Court Opinion

ID: 9670913
Source: CourtListenerOpinion
Date Created: 2023-08-24 03:28:11.934756+00
Date Added: 2024-06-11T18:16:07.238419
License: Public Domain

WOLLE, Justice
(dissenting).
The majority hinges its reversal of the trial court on what it finds to be the legislative intent of Iowa Code chapter 516A (1983). That statute originally required insurers of motor vehicles to provide protection for their insureds who are “legally entitled to recover damages from the owner or operator of an uninsured motor vehi*523cle or a hit-and-run motor vehicle.” In 1980 the statute was amended by adding the words “underinsured motor vehicle” to the description of the required coverage. See 1980 Iowa Acts eh. 1106 §§ 6, 7 (West). The majority finds in that statute as amended the intent to require insurers to provide quite expansive underinsurance— basically floating coverage which picks up and pays the difference between an insured person’s loss and the tortfeasor’s liability insurance coverage, subject only to the maximum limit of the underinsured vehicle coverage. The majority also finds an intent to disallow or at least severely restrict the insurer’s attempt to avoid duplication of insurance or other benefits. I agree that the law writes this type of statute into insurance policies, but I do not find in chapter 516A an intent to nullify the effect of any of the provisions of United’s policy. To the contrary, I believe that the wording of the statute as amended is consistent with each pertinent provision of United’s policy. What the legislature said, not what it should or might have said, should be our primary guide to ascertaining legislative intent. Iowa R.App.P. 14(f)(13).
I. The insurance policy defines underin-sured motor vehicle as follows:
“Underinsured Motor Vehicle” means a land motor vehicle or trailer of any type to which a bodily injury liability bond or policy applies at the time of the accident but its limit for bodily injury liability is less than the limit of liability for this coverage.
Under that definition underinsured vehicle coverage applies only to the extent that limits of liability insurance applicable to the operation of a tortfeasor’s vehicle are less than the applicable underinsured vehicle limit or limits. In other words, the amount of “underinsured” vehicle coverage is the amount by which the liability coverage applicable to the tortfeasor’s vehicle is under the applicable underinsured policy limit.
The majority accepts the Tollari estate’s argument that section 516A requires a much different measurement of underinsu-rance coverage, consequently a much different definition in the policy. The majority reads the statute to require that the comparison be made between the liability coverage “available to the victim” and “his loss that the tortfeasor’s liability insurance does not reach, subject to the limit of the underinsurance clause.” That comparison certainly would expand the scope of coverage far beyond the policy definition, because it focuses not on the liability insurance of the “underinsured” vehicle but rather on two new factors: (1) the amount other injured persons may receive out of the liability insurance which would reduce the “available” liability insurance; and (2) the total amount of the insured’s damages, which may far exceed even hefty liability limits on the tortfeasor vehicle. I believe the majority opinion really defines not the words “underinsured motor vehicle” used in the statute and United’s policy but a different concept — inadequate recovery by an insured. Neither expressly nor by fair implication does chapter 516A suggest that such a definition or such a comparison is required.
Contrary to the majority, I believe the only comparison suggested by the statute for determining what is an “underinsured motor vehicle” is the comparison provided in United’s policy — a comparison of the limits of coverage purchased by the insured against the actual liability limits covering operation of the tortfeasor’s vehicle. Section 516A.1 specifically provides that this coverage “shall include limits for bodily injury or death at least equal to those stated in section 321A.1(10).” The reference is to the statute which provides the minimum limits of automobile insurance required for drivers for whom insurance is mandatory. It should be noted that the amendment to chapter 516A which first required that underinsured vehicle insurance be offered was simply part of the legislative Act which increased the minimum limits of liability coverage under Iowa Code chapter 321A. The Act was entitled “automobile liability insurance.” 1980 Iowa Acts ch. 1106 (West). This lends support to United’s contention that the legislative intent in requiring coverage was mere*524ly to assure Iowa citizens that if an insured tortfeasor’s vehicle had lower coverage limits than required by section 321A.1(10), the insured’s policy covering damages caused by such an “underinsured motor vehicle” would make up the difference.
I think the majority opinion gives undue weight to the dictum in Detrick v. Aetna Casualty and Surety Co., 261 Iowa 1246, 1253, 158 N.W.2d 99, 104 (1968), in which a dictionary definition of “underinsurance” is quoted. The reference to “coinsurance” in that dictionary definition suggests that it was describing an entirely different kind of insurance than the underinsured vehicle coverage which section 516A now mandates. The Detrick case was decided long before the legislature inserted the phrase “underinsured motor vehicle” in chapter 516A. It is perhaps noteworthy, moreover, that when our court in Detrick explained the word “underinsured” rather than “un-derinsurance”, it did so with specific reference to Iowa Code section 321A.1(10), saying:
[The operator of the tortfeasor’s vehicle] was not uninsured nor underinsured within the requirements of the statute. We find no authority authorizing us to define the word “uninsured” to mean underinsured in relation to plaintiffs injury.
Id. (emphasis added).
Iowa Code section 516A.1 also provides: The form and provisions of such coverage shall be examined and approved by the commissioner of insurance.
I believe the trial court correctly relied on a 1980 declaratory ruling issued by the insurance commissioner to several Iowa insurers. That ruling is significant both in what the commissioner did require for compliance and what the commissioner did not require. Asked to interpret the new under-insured motor vehicle coverage, the commissioner decided that insurers should provide higher coverage limits for that insurance than the minimum coverage required for basic automobile liability insurance under Iowa Code section 321A.1(10). The commissioner thus insisted that insureds receive some protection even when the tort-feasor’s vehicle carried the minimum liability coverage required by that Iowa statute. More importantly, the commissioner did not require insurers to include in their policies a definition of “underinsured motor vehicle” any different than that used in United’s policy, even though the legislature clearly and specifically had left to the commissioner the responsibility to select and define provisions fixing the parameters of this new coverage. The sound legislative purpose for leaving specific forms and provisions of coverage in the hands of the commissioner of insurance is to provide insurers advance notice of the risk they must undertake and the premium that may fairly be charged for that risk. The majority’s expansive reading of chapter 516A unfairly penalizes United, requiring it retrospectively to cover a risk which was not written into its policy, which the insurance commissioner did not require be written into its policy, and which, I suggest, a reasonable reading of chapter 516A would not require.
Of the cases from other jurisdictions which are relied upon by the parties, I believe two well-reasoned Minnesota cases are most instructive because they construed a statute similar to Iowa Code chapter 516A. In Lick v. Dairyland Insurance Co., 258 N.W.2d 791 (Minn.1977), a case the trial court relied upon, the Minnesota court rejected arguments similar to those made by the Tollari estate in this case concerning the meaning and scope of underinsured vehicle coverage required by statute. The court said:
The purpose of underinsured coverage is to provide an individual, injured by a motorist who carries less insurance than the minimum required in Minnesota, with no less coverage than the injured party would receive had the tortfeasor been insured as required by the Safety Responsibility Act.
Where the tortfeasor carried liability insurance in an amount equal to the “underinsured motorist” coverage car*525ried by decedents, the tortfeasor was not “underinsured.”
Id. at 794-95. Subsequently, the Minnesota supreme court in Thiry v. Horace Mann Mutual Insurance Co., 269 N.W.2d 66 (Minn.1978), followed the Lick decision in holding that the tortfeasor could not be held to be an underinsured motorist where the limits of liability on the tortfeasor’s vehicle were the same as the underinsured motorist coverage on the plaintiffs own policy. The fact that the judgment against the tortfeasor was greater than the liability insurance coverage was deemed immaterial. Id. at 68. These two decisions are no longer authoritative in Minnesota, but only because the statute was replaced with statutory no-fault insurance, not because their reasoning is unsound. See Holman v. All Nation Insurance Co., 288 N.W.2d 244, 251 (Minn.1980).
The vehicle in which the victims in this case were passengers was covered by liability insurance totaling $120,000. The under-insured vehicle coverage of United’s policy was $50,000. I would uphold the trial court’s conclusion and ruling that the tort-feasor’s vehicle was certainly not an “underinsured motor vehicle” under either the provisions of United’s insurance policy or within the intendment of pertinent Iowa insurance statutes.
II. The majority’s interpretation of statutory requirements for underinsured vehicle coverage also eliminates from United’s policy and reads out of section 516A.2 provisions which allow the insurer to avoid duplication of insurance or other benefits.
The clause in United’s policy which limited liability for underinsured vehicle coverage to $50,000 also provided:
However, the limit of liability shall be reduced by all sums paid because of the bodily injury by or on behalf of persons or organizations who may be legally responsible.
The trial court concluded that that language was consistent with Iowa Code sections 516A.2 and .4 which provide in pertinent part:
Such forms of coverage may include terms, exclusions, limitations, conditions, and offsets which are designed to avoid duplication of insurance or other benefits.
Iowa Code § 516A.2.
In the event of payment to any person under the coverage required by this chapter and subject to the terms and conditions of such coverage, the insurer making such payment shall, to the extent thereof, be entitled to the proceeds of any settlement or judgment resulting from the exercise of any rights of recovery of such person against any person or organization legally responsible for the bodily injury for which such payment is made, including the proceeds recoverable from the assets of the insolvent insurer.
Iowa Code § 516A.4. We recently addressed the subject of duplication of insurance benefits under Iowa Code chapter 516A in Davenport v. Aid Insurance Co., 334 N.W.2d 711 (Iowa 1983). There, the plaintiff contended that an insurer could not offset against uninsured vehicle coverage the amount of a settlement received from a third-party tortfeasor. Although a majority of jurisdictions supported the plaintiff’s view, we held in Davenport that the insurer’s policy provisions allowing an offset were consistent with the Iowa statute and should be enforced. We said:
Here, the plain language of section 516A.2 compels us to reject the majority view and to allow insurers the right to prepare policies which prevent “duplication of insurance or other benefits.”
Id. at 715.
I believe the result reached by the majority opinion cannot be squared with the holding and language of Davenport. Nothing in chapter 516A expressly or impliedly deprived United of its right to write that reimbursement provision into its policy; instead, sections 516A.2 and .4 affirmatively permitted it to do so.
We have often declined to read into statutes language which the legislature could have supplied had it so intended. See, e.g., Neumeister v. City Development Board, *526291 N.W.2d 11, 14 (Iowa 1980); Hamilton v. City of Urbandale, 291 N.W.2d 15, 19 (Iowa 1980). I would affirm the decision of the trial court which was based on what the legislature said in amending Iowa Code chapter 516A and not what it might have said.
SCHULTZ and CARTER, JJ., join in this dissent.