Court Opinion

ID: 9628554
Source: CourtListenerOpinion
Date Created: 2023-08-22 09:24:16.679745+00
Date Added: 2024-06-11T18:07:07.412221
License: Public Domain

ROVIRA, Justice,
concurring in part and dissenting in part:
I concur in Part II of the majority opinion. In my opinion a fair analysis of the Colorado Automobile Reparations Act (Act), sections 10-4-701 to -723, 4 C.R.S. (1973), supports the conclusion reached by the majority. If the legislature does not agree with our reading of the Act, a statutory change would set the matter right. See Farmers Insurance Exchange v. Cocking, 29 Cal.3d 383, 173 Cal.Rptr. 846, 628 P.2d 1 (1981) (legislature’s decision to authorize insurers to exclude bodily injury liability to an insured is supported by a variety of rational, legitimate reasons).
However, I dissent from Part III of the opinion which holds that the limits of liability should not be restricted to the minimum amount of liability coverage required by the Act.
In support of its choice from “two equally compelling arguments” the majority concludes that since the insured purchased more coverage than required by the Act, he *594is entitled to the limits of the policy and not the minimum required by the statute. This result overlooks two facts. First, the premium paid for the policy was based on the inclusion of the household exclusion provision in the policy; and second, even if the household exclusion is contrary to public policy, the carrier would still have the opportunity to limit its policy to the minimum amount required by the statute, and limit any excess coverage by a household exclusion provision. See, e.g., DeWitt v. Young, 229 Kan. 474, 625 P.2d 478 (1981).
In substance and effect, the majority’s choice is supported only by its conclusion that since the Act allows coverage greater than the minimum, it reflects the legislative intent to avoid inadequate compensation, i.e., maximize rather than minimize insurance coverage.
The minimum coverage required by the Act is set out in section 10-4-706, 4 C.R.S. (1973). Insurance carriers may also offer coverage in excess of that required. See section 10-4-710, 4 C.R.S. (1973).
The general rule is that although an insurance policy must comply with statutory requirements, such as those in the Act, a statute has no effect upon insurance which it does not require. Also, exclusions in liability insurance policies are valid and enforceable as to amounts exceeding the coverage required by statute. See DeWitt v. Young, 229 Kan. 474, 625 P.2d 478 (1981); 7 Am.Jur.2d, Automobile Insurance § 30 (1980).
Since the Act does not preclude application of the household exclusion to liability insurance coverage in excess of that required by statute, I believe it preferable to follow the general rule and hold the exclusion void only as to the minimum coverage required by statute. The majority of appellate courts support this view. Arceneaux v. State Farm Mutual Automobile Insurance Co., 113 Ariz. 216, 550 P.2d 87 (1976) (coverage in excess of that mandated by law, not subject to provisions of statute); DeWitt v. Young, 229 Kan. 474, 625 P.2d 478 (1981) (exclusions are void only as to the minimum coverage required by statute); State Farm Mutual Auto Ins. Co. v. Shelly, 394 Mich. 448, 231 N.W.2d 641 (1975) (where exclusionary clause void, reinstated coverage is limited to amount required by statute); Estate of Neal v. Farmers Insurance Exchange, 93 Nev. 348, 566 P.2d 81 (1977), (even though the household exclusion clause was void insofar as it attempted to eliminate the minimum security for tort liability required by statute, it was otherwise viable in that liability was limited to the statutory minimum).