Court Opinion

ID: 9531903
Source: CourtListenerOpinion
Date Created: 2023-08-07 04:15:53.28594+00
Date Added: 2024-06-11T13:28:37.272867
License: Public Domain

SUMMERS, Justice,
concurring in part and dissenting in part, with whom LAVENDER and SIMMS, JJ., joins.
Although I concur with the majority’s conclusion regarding the evidence of the driver’s lability, and its result regarding the Church Mutual insurance policy, I must voice my concerns about the remainder of the opinion. The majority overrules Hibbs v. Farmers Ins. Co. Inc., 725 P.2d 1232 (Okla.1986) without comment.
The purpose behind uninsured motorist coverage is to assure the availability of insurance for the protection of insured persons injured by uninsured or underinsured motorists. This purpose is not thwarted by permitting insurers, by clear and express language in an insurance policy, to make their coverage excess in certain situations. For example, in the present situation, the “excess” clauses only come into effect if there is other collectible insurance. If there is other collectible insurance the injured insured person is protected, as are the goals of Section *54436S6. “Statutory policy is implicated only when insurers deny liability, not when they are in dispute as to which will provide primary coverage.” Equity Mutual, at 955.
We upheld a clause substantially similar to those clauses in the present case in Hibbs, supra. There, an employee sued his employer’s insurance company, alleging that he was entitled to UM benefits under the policy. The employer’s UM insurer settled for less than the policy limits. The employee then sought UM benefits from his own insurer. His insurer refused payment because of an “Other Insurance” clause which stated that the coverage was excess over the policy limits. other insurance. Relying on Keel v. MFA, 553 P.2d 153, 158 (Okla.1976), we upheld the clause, stating that these “Other Insurance” clauses could establish priority of payments. We determined that the employee was not entitled to UM benefits from his own insurer because he had failed exhaust the limits of the primary UM carrier. “Even though courts in most states have concluded that the ‘excess’ clause in an Other Insurance clause may not be used by insurance companies in most jurisdictions to avoid liability, the excess provision has been applied by judges to determine primary and secondary liability.” Widiss, Uninsured and Underin-sured Motorist Insurance, vol. 1, § 13.7.
That is exactly the idea we affirmed in Keel, 553 P.2d at 156. In Keel we specifically stated that “‘Other insurance clauses’ are applicable to priority of payment.” The majority not only overrules Hibbs, supra, but also calls into doubt a portion of Keel. If the majority’s concern is the undisputed fact that Pentz did not exhaust the primary insurance before seeking benefits from the excess insurance carriers, the approach of Buzzard v. Farmers Ins. Co. Inc., 824 P.2d 1105 (Okla.1992) could be useful. There, we held that although primary liability insurance limits had not been exhausted, the injured person could recover under UM coverage as long as the UM carrier was not obligated to pay that amount due and owing by the liability insurer. In other words, if the UM plaintiffs damages exceeded the liability carrier’s policy limits, the UM carrier would be liable up to its policy limits less the liability carrier’s policy limits. Id. at 1111, 1112. While the present ease is factually dissimilar from Buzzard, a Buzzard-]ike approach could be utilized to protect the injured insured from insurance companies who seek to completely avoid liability.
The majority ignores the impact of Hibbs on the case at bar. Hibbs could be affirmed in principle while also protecting the injured person, if the Court would adopt a Buzzard-like approach in UM cases with “other insurance” clauses such as this one. This approach would not defeat the purpose of uninsured/underinsured motorist coverage. It would give full effect to the UM coverage by protecting the insured, but allow the insurer to avoid risks not covered by the policy and the premium charged.
Without any explanation the majority decides that summary judgment was properly granted in favor of Church Mutual. While I agree that Church Mutual was not required to offer UM coverage, I would address the issue in more detail, as it is an issue of first impression.
The multi-peril policy issued by Church Mutual did not offer UM coverage. The question then becomes whether under Oklahoma statutes it was required to offer such coverage. In Moser v. Liberty Mutual Ins. Co., 731 P.2d 406 (Okla.1987), we held that an umbrella policy was not required under 36 O.S.1981 § 3636 to provide UM coverage. An umbrella policy is a policy which provides excess liability coverage. Id. at 407. The legislative intent of Section 3636 was to required it to apply to all “automobile liability insurance policies (or motor vehicle liability policies as defined in 47 O.S. § 7-324).” Id. at 409. This Court concluded that the intent behind Section 3636 was satisfied by applying it to primary liability policies.
In MacKenzie v. Empire Ins. Co., 113 Wash.2d 754, 782 P.2d 1063 (1989), the Washington Supreme Court was faced with the question of whether a multi-peril policy was required to offer UM coverage. The court held that it was exempt from mandatory UM statutes only if the policy provided only excess coverage (much like an umbrella policy). If the multi-peril policy was primary, it was not exempt. In this case the multi-peril *545policy issued by Church Mutual specifically provided automobile liability coverage. However, that section of the policy contained a clause which stated that “[t]he insurance afforded by this endorsement shall be excess insurance over any other valid and collectible insurance available to the insured.” It contained the same “excess insurance” clause with regard to hired automobiles.
Thus, this multi-peril policy does not appear to be a primary liability policy. As such, it does not fall within the mandate of Section 3636, and the company was not required to offer UM coverage. Because it does not provide UM coverage and because Section 3636 does not require it to provide UM coverage, Church Mutual is not liable under its multi-peril policy. Summary judgment on that policy was proper.