Court Opinion

ID: 9701205
Source: CourtListenerOpinion
Date Created: 2023-08-25 22:10:28.167503+00
Date Added: 2024-06-11T18:21:20.848361
License: Public Domain

LOUIS B. BUTLER, JR., J.
¶ 40. (dissenting). The majority concludes that American Family was required to notify the Rebernicks of the availability of Underinsured Motorists (UIM) coverage under their umbrella policy pursuant to Wis. Stat. § 632.32(4m). Majority op., ¶ 2.1 agree with this conclusion and join that portion of the opinion.
¶ 41. However, I disagree with the majority's determination that American Family provided the required notice. Id. I conclude that American Family failed to meet the explicit statutory notice requirements established under Wis. Stat. § 632.32(4m). Because the proper remedy, if any, for American Family's failure to provide the notice cannot be determined based on the present record, I would reverse the court of appeals and remand this matter to the circuit court for further proceedings. I therefore respectfully dissent.
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¶ 42. The majority's summary of the facts accurately reflects the record in this case. Majority op., *343¶¶ 3-7. In short, the Rebernicks had separately purchased a primary automobile insurance policy and a $1 minion umbrella policy through American Family Insurance. The Rebernicks had purchased UIM coverage for their primary automobile insurance policy, but the terms of an exclusion in their umbrella policy purchased one week later indicated that American Family "will not cover any claims" made under Underinsured Motorists Coverage "unless this policy is endorsed to provide" UIM coverage. The Rebernicks assert that they are entitled to retroactively purchase UIM coverage under their umbrella policy because American Family had failed to provide them with notice of the availability or description of UIM coverage in the umbrella policy as required under Wis. Stat. § 632.32(4m).
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¶ 43. Whether American Family adequately notified the Rebernicks of the availability of UIM coverage under their umbrella policy requires the application of Wis. Stat. § 632.32(4m) to undisputed facts. The interpretation and application of a statute to undisputed facts is ordinarily a question of law subject to independent appellate review. Phelps v. Physicians Ins. Co., 2005 WI 85, ¶ 25, 282 Wis. 2d 69, 698 N.W.2d 643.
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¶ 44. Whether an insurer is required to provide a separate written notice for each insurance policy under Wis. Stat. § 632.32(4m), including the umbrella policy at issue in this case, is a matter of statutory interpretation. I agree with and, for purposes of this dissent, adopt the majority's legal analysis regarding the proper interpretation of what is required under the statute. Majority op., ¶¶ 11-31. Under § 632.32(4m):
*344An insurer writing policies [to which these notice requirements apply] . . . shall provide to one insured under each such insurance policy that goes into effect after October 1,1995, that is written by the insurer and that does not include underinsured motorist coverage written notice of the availability of underinsured motorist coverage, including a brief description of the coverage. An insurer is required to provide the notice required under this subdivision only one time and in conjunction with the delivery of the policy.
Wis. Stat. § 632.32(4m)(a)l.(emphasis added). If an insured's policy does not already include UIM coverage, the language of § 632.32(4m)(a)l. requires that an insurer provide an insured with written notice, that the notice inform the insured that UIM coverage is available and include a brief description of the available coverage, and that the notice be provided when the policy is delivered to the insured. The statutory language also makes plain that an insurer must provide the notice for each policy to which the statute applies.
¶ 45. It is undisputed that when the Rebernicks were issued their underlying auto policy on April 29, 2001, American Family provided the Rebernicks with the required notice for that policy. That notice informed the Rebernicks of the availability of UIM coverage:
SPECIAL NOTICE TO POLICYHOLDERS
This special notice is being given in accordance with Wisconsin law to advise you of the availability of Underinsured Motorist (UIM) coverage. If you do not presently carry UIM coverage, this message is especially important to you.
Underinsured Motorist coverage provides payment for legally collectible damages for bodily injury or death if you or any person riding in your vehicle is injured or killed in an accident with a vehicle whose driver has *345insurance coverage that is less than the limit of your underinsured motorist coverage.
Please see the actual policy for exact terms and conditions.
Contact your American Family agent if you have questions about this coverage.
¶ 46. However, when American Family issued the Rebernicks' umbrella policy on May 7, 2001, approximately one week after the Rebernicks obtained their primary automobile policy, American Family failed to include any "written notice" of the availability of UIM coverage, "in conjunction with the delivery of the [umbrella] policy," as required by Wis. Stat. § 632.32(4m)(a)l. Additionally, American Family provided no description of UIM coverage with the umbrella policy.
¶ 47. The majority reasons that only a short period of time had passed since the Rebernicks had received the required written notice for their separate but related underlying policy, and therefore the Rebernicks were aware of the nature of UIM coverage available under an American Family policy. Majority op., ¶ 36.
¶ 48. In addition, the umbrella policy itself contained an exclusion provision, which notified the insured that UM/UIM coverage was not included unless "this" policy was endorsed to provide such coverage. According to the majority, the exclusion provision contained in the umbrella policy alerted the Rebernicks that UIM coverage was available under the umbrella policy. Majority op., ¶ 37.
¶ 49. Although the majority concedes that the exclusion provision alone would not constitute notice, it concludes that, in view of all the facts, American Family substantially complied with the written notice requirement. Majority op., ¶ 38. The majority has essentially determined that American Family's compliance with the *346notice requirements of Wis. Stat. § 632.32(4m) was good enough with respect to the Rebernicks' umbrella policy. Id.
¶ 50. I disagree. This is not horseshoes, and close is not good enough. The majority disregards the plain language of the statute. American Family failed to notify the Rebernicks of the availability or description of UIM coverage under their umbrella policy pursuant to the explicit requirements of Wis. Stat. § 632.32(4m). Consequently, I agree with the court of appeals' dissent that American Family failed to meet the notice requirements for the Rebernicks' umbrella policy.
¶ 51. American Family did not provide the Reber-nicks with a written description of UIM coverage "in conjunction with the delivery" of their umbrella policy, as Wis. Stat. § 632.32(4m)(a)l. requires. Thus, American Family did not provide the required "written notice," which must include a "brief description of [UIM] coverage." The statute requires that the notice be provided "under each such ... policy." (Emphasis added.) The fact that the Rebernicks may have been generally aware of the nature of UIM coverage based on a previous notice is insufficient under the plain language of the statute.
¶ 52. In addition, the notice of exclusion in the Rebernicks' umbrella policy cannot constitute sufficient "written notice" of the "availability" of UIM coverage. The exclusion merely indicates that UIM claims will not be covered unless "this" policy is endorsed to provide such coverage.1 The exclusion does not indicate that separate UIM coverage is available, nor does it describe the additional UIM coverage that is available. This *347notice of exclusion does not satisfy the notice requirements under Wis. Stat. § 632.32(4m)(a) 1.
¶ 53. Moreover, under the facts here, a reasonable insured may have been confused as to just what the exclusion really meant. On the one hand, a reasonable insured may have been led to believe that UIM coverage was not available under the umbrella policy, despite the exclusion. A reasonable insured might infer that such coverage was not available under the policy because the insurance company did not provide the same separate "SPECIAL NOTICE TO POLICYHOLDERS" of the availability of UIM coverage that it provided with the underlying automobile policy. Stated another way, a reasonable insured might believe that the absence of the "special notice" with the umbrella policy indicated that UIM coverage was not available under that policy.
¶ 54. On the other hand, a reasonable insured may have been led to believe that UIM coverage was already provided under the policy precisely because of the "SPECIAL NOTICE TO POLICYHOLDERS” of the availability of UIM coverage that was provided with the underlying automobile policy. After being given notice of the existence of UIM coverage, the policyholders (Rebernicks) elected to have such coverage. Since the insurance company provided no new "SPECIAL NOTICE," a reasonable insured may have concluded that the purchase of UIM coverage made one week earlier was sufficient for purposes of electing UIM coverage in the umbrella policy.
¶ 55. I agree with the majority that the best way for insurance companies to be certain that they have *348provided proper notice pursuant to Wis. Stat. § 632.32(4m) is to comply with the words of the statute. Majority op., ¶ 39. In fact, I assert an insurer is required to comply with the words of the statute. An insurer must separately provide written notice of both the availability of, as well as a description of, the available UIM coverage with each policy the insurer issues to an insured. Neither was done here.
¶ 56. The question becomes what is the proper remedy for American Family's failure to provide the required notice for the Rebernicks' umbrella policy. As the majority notes, the Rebernicks assert that the remedy is that the umbrella policy be reformed, meaning they should be given the opportunity to retroactively purchase UIM coverage under their umbrella policy. Majority op., ¶ 32.
¶ 57. Under Wis. Stat. § 631.15(3m), an insurance policy "that violates a statute or rule is enforceable against the insurer as if it conformed to the statute or rule." Thus, § 631.15(3m) provides, in effect, for reformation of an insurance policy that violates a statute. Yet, application of the statutory language to the facts here does not result in a straightforward answer to the question of what remedy, if any, is appropriate.
¶ 58. If American Family had complied with Wis. Stat. § 632.32(4m) in the issuance of the umbrella policy, the Rebernicks would have received the proper written notice in conjunction with their umbrella policy. However, § 632.15(3m) cannot answer the question of whether, had American Family provided the notice, the Rebernicks would have purchased UIM coverage in their umbrella policy.
¶ 59. Likewise, even assuming that they would have purchased such coverage, we cannot be certain on this record of whether (or to what extent) the coverage *349would have applied. American Family argues that even if the policy is reformed, a remand is necessary to determine if any additional exclusions or reducing clauses would apply here. It asserts in its brief:
It is undisputed that Mr. Rebernick was acting within the scope of his employment at the time of his accident. American Family's UIM endorsement contains a reducing clause which allows American Family to reduce the limit of its UIM coverage by the amount of any worker's compensation payments that have been made.
¶ 60. In short, the remedy question in this case involves factual issues that cannot be resolved based on the current record.
¶ 61. Unlike other cases where reformation of the policy under Wis. Stat. § 632.15(3m) may resolve the matter, reformation in this case would only be the beginning. In other cases, the applicability or validity of an exclusion, reducing clause, "other insurance" clause, or other policy provision may become readily apparent on the existing record. See, e.g., Progressive N. Ins. Co. v. Hall, 2006 WI 13 ¶¶ 7-8, 288 Wis.2d 282, 709 N.W.2d 46 (applying § 632.15(3m) to determine that the invalidity of an "other insurance" clause under § 632.32(3) (a) controlled which of two insurance companies paid the first $100,000 in coverage).
¶ 62. In this case, however, we are not presented with a policy that is easily "conformed to the statute or rule," Wis. Stat. § 632.15(3m), in a manner that readily dictates the ultimate remedy. Rather, we are dealing only with notice of the availability of UIM coverage. Lack of such notice will not always translate into payment of insurance proceeds.
*350¶ 63. Accordingly, I would remand for further proceedings for the circuit court to determine what, if any, remedy is appropriate.
IV
¶ 64. Because American Family failed to meet the explicit statutory requirements under Wis. Stat. § 632.32(4m), I conclude that American Family did not provide the Rebernicks with the required notice in the issuance of the umbrella policy. In addition, because the proper remedy, if any, for American Family's failure to provide the notice cannot be determined based on the present record, I would reverse the court of appeals and remand to the circuit court for further proceedings consistent with this opinion. I therefore respectfully dissent.
¶ 65. I am authorized to state that Chief Justice SHIRLEY S. ABRAHAMSON joins this dissenting opinion.

 American Family asserts that the language of exclusion 21 of the umbrella policy puts the insured on notice that excess UM/UIM coverage can be purchased. The actual language of the exclusion provides:
*347We will not cover any claims which may be made under Uninsured Motorists Coverage, Underinsured Motorists Coverage or similar coverage, unless this policy is endorsed to provide such coverage.