Court Opinion

ID: 809226
Source: CourtListenerOpinion
Date Created: 2012-09-26 13:36:43+00
Date Added: 2024-06-11T18:00:33.503238
License: Public Domain

In the

United States Court of Appeals
               For the Seventh Circuit

No. 11-1600

G RINNELL M UTUAL R EINSURANCE C O .,

                                                 Plaintiff-Appellant,
                                  v.

N ICOLE A. H AIGHT,
                                                Defendant-Appellee.

            Appeal from the United States District Court
       for the Northern District of Illinois, Western Division.
             No. 10 CV 50042–Frederick J. Kapala, Judge.

  A RGUED S EPTEMBER 30, 2011—D ECIDED S EPTEMBER 26, 2012

  Before E ASTERBROOK , Chief              Judge,      and        P OSNER
and W ILLIAMS, Circuit Judges.
  W ILLIAMS, Circuit Judge. Shawn Haight purchased an
insurance policy that included underinsured motorist
coverage for the named insured (him) and any family
members. After his teenage daughter Nicole was injured
while riding in a car driven by an acquaintance whose
insurance did not fully compensate her, she made an
2                                            No. 11-1600

underinsured motorist claim on her father’s policy. The
insurance company maintains that Nicole is not entitled
to coverage because she was not riding in a vehicle
listed on her father’s policy when she was hurt. But we
read the policy to provide underinsured motorist cov-
erage to the named insured and his family members
that does require the named insured or his family
members to be occupying a vehicle listed on the policy
during the accident. We therefore affirm the district
court’s entry of summary judgment in favor of Nicole.

                  I. BACKGROUND
  Nicole Haight was hurt in a single-car accident while
a passenger in a car driven by Brian Day. Her medical
bills exceeded the $50,000 in bodily injury coverage that
Day had through his carrier, Country Insurance. She
therefore made a claim seeking underinsured motorist
(“UIM”) coverage on a policy Grinnell Mutual Reinsur-
ance Co. had issued to her father. According to its
website, Grinnell provides insurance in twelve states
throughout the Midwest.
  The policy Grinnell issued to Shawn Haight (sometimes
referred to in the documents as “Shawn Haight d/b/a/
SMH Rebuilding”) has a “Business Auto Coverage
Form” and various endorsements. Grinnell used forms
and endorsements created by the Insurance Services
Office, Inc., a national clearinghouse. The endorsement
at issue here, the Illinois Underinsured Motorists
Coverage Endorsement, provides $300,000 in coverage
for all amounts the “insured” is entitled to recover as
No. 11-1600                                               3

compensatory damages from the owner or driver of an
underinsured vehicle.
  Day is not related to the Haights, nor does he work for
Shawn Haight, and Day’s car was not one of the two
vehicles listed on Shawn Haight’s policy. Maintaining
that Nicole was not entitled to UIM coverage under the
policy issued to her father because she was not riding in
a “covered auto” during the accident, Grinnell filed
this action in the United States District Court for the
Northern District of Illinois seeking a declaratory judg-
ment to that effect. The parties each moved for
summary judgment, and the district court granted
Nicole’s motion. Grinnell appeals.

                      II. ANALYSIS
  A. Subject Matter Jurisdiction
  Our first task, as it is in every case, is to determine
whether we have subject matter jurisdiction. The com-
plaint asserts that the federal court has jurisdiction based
on 28 U.S.C. § 1332(a) because the parties are citizens
of different states and the amount in controversy
exceeds $75,000. The jurisdictional statements in the
parties’ appellate briefs assert that we have jurisdiction
but do not give any information beyond that in the com-
plaint.
  Nicole’s medical damages at the time the suit was filed
were approximately $60,000. Day’s policy covered
$50,000, so we wondered whether we had jurisdiction and
inquired at oral argument. Grinnell took us up on our
4                                                No. 11-1600

suggestion to seek leave after argument to amend its
jurisdictional allegation, and it now seeks to supplement
with additional facts. See 28 U.S.C. § 1653 (“Defective
allegations of jurisdiction may be amended, upon terms,
in the trial or appellate courts.”); Newman-Green, Inc. v.
Alfonzo-Larrain, 490 U.S. 826, 830-32 (1989).
  Grinnell would now like to add more detail about the
accident and Nicole’s injuries. The additional allega-
tions include that in the accident, Nicole was ejected
from the vehicle in which she was riding and suffered
multiple pelvic fractures, a fractured lower vertebra,
minor head injuries, and contusions. Her recovery
included two months of bed rest and time in a wheel-
chair. She claims continued pelvic and low back pain, a
reduced ability to walk and sit for extended periods, and
possible complications during pregnancy. Grinnell also
seeks to add to its jurisdictional allegation that it is ex-
posed to $250,000 in liability under the policy at issue.
  As we have explained, the standard for determining
the amount in controversy requirement “was established
by the Supreme Court in St. Paul Mercury: unless
recovery of an amount exceeding the jurisdictional mini-
mum is legally impossible, the case belongs in federal
court.” Back Doctors Ltd. v. Metro. Prop. and Cas. Ins. Co.,
637 F.3d 827, 830 (7th Cir. 2011) (citing St. Paul Mercury
Indem. Co. v. Red Cab Co., 303 U.S. 283, 293 (1938)). The
demonstration “concerns what the plaintiff is claiming
(and thus the amount in controversy between the par-
ties), not whether plaintiff is likely to win or be awarded
everything he seeks.” Id. at 829-30 (quoting Brill v. Country-
No. 11-1600                                               5

wide Home Loans, Inc., 427 F.3d 446, 449 (7th Cir. 2005)).
Also relevant in this regard, in addition to the
other information about Nicole’s claimed injuries and
their long-term effects, is that Grinnell has now informed
us that Nicole’s settlement demand was $250,000. Al-
though settlement negotiations are not admissible at
trial pursuant to Federal Rule of Evidence 408 to prove
liability for or invalidity of the claim or its amount, they
can be considered “to show the stakes” when deter-
mining whether the amount in controversy is met. Rising-
Moore v. Red Roof Inns, Inc., 435 F.3d 813, 816 (7th Cir.
2006). The additional information we have received
assures us that Nicole is seeking damages in excess of the
jurisdictional threshold. Cf. Walton v. Bayer Corp., 643
F.3d 994, 998 (7th Cir. 2011) (finding federal jurisdiction
based on litany of injuries plaintiff claimed to have sus-
tained). We grant Grinnell’s request to amend its juris-
dictional allegation, and, satisfied that jurisdiction
exists, we proceed to the merits.

  B. Whether Nicole Haight Receives Underinsured
     Motorist Coverage
  We review de novo the district court’s grant of summary
judgment as well as its construction of the insurance
policy. See Auto-Owners Ins. Co. v. Munroe, 614 F.3d 322,
324 (7th Cir. 2010). The parties agree that Illinois law
governs the interpretation of the policy. In construing the
policy, our primary objective is to ascertain and give
effect to the parties’ intentions as expressed by the words
of the policy. Rich v. Principal Life Ins. Co., 875 N.E.2d
6                                               No. 11-1600

1082, 1090 (Ill. 2007). As with any contract, we construe
an insurance policy according to the plain and ordinary
meaning of its unambiguous terms. Auto-Owners Ins. Co.,
614 F.3d at 324 (citing Nicor, Inc. v. Associated Elec. &
Gas, 860 N.E.2d 280, 286 (Ill. 2006)). Where a policy provi-
sion is ambiguous, Illinois courts liberally construe it
in favor of coverage. Founders Ins. Co. v. Munoz, 930
N.E.2d 999, 1004 (Ill. 2010).
   Grinnell maintains that Nicole Haight is not entitled
to UIM coverage under the policy because the car in
which she was riding when injured was not a “covered
auto.” Nicole, on the other hand, maintains that she is
an “insured” under the UIM policy as Shawn Haight’s
family member. We note at the outset that this is not a
case about a claim on a liability insurance policy. Illinois
imposes a mandatory liability insurance requirement on
all motor vehicles operating on its highways, and the
liability policy must cover any person using the vehicle.
See 625 ILCS 5/7-601(a); 625 ILCS 5/7-317(b)(2); Schultz v.
Ill. Farmers Ins. Co., 930 N.E.2d 943, 950 (Ill. 2010). In
contrast to liability insurance’s focus on the vehicle,
uninsured and underinsured motorist coverage can
protect the named insured and family members “when
they are operating or are passengers in a motor vehicle,
as well as when they are engaged in any other activity
such as walking, riding a bicycle, driving a hay wagon,
or even sitting on a front porch.” See 3 Alan I. Widiss &
Jeffrey E. Thomas, Uninsured and Underinsured Motorist
Insurance § 4.2 (3rd ed. 2005); see also id. § 33.2; Doyle v.
State Farm Mut. Auto. Ins. Co., 775 N.E.2d 180, 181-82 (Ill.
App. Ct. 2002) (detailing policy that provided for unin-
No. 11-1600                                                 7

sured motorist coverage if insured sustained bodily
injury while walking and was struck by motor vehicle).
  With that background in mind, we turn to the policy
at issue here. The policy consists of a Business Auto
Coverage Form and several endorsements, with the
“Illinois Underinsured Motorists Coverage” endorsement
the one in question. This document begins by stating in
all capital letters: “THIS ENDORSEMENT CHANGES
THE POLICY. PLEASE READ IT CAREFULLY.” Under-
neath the “ILLINOIS UNDERINSURED MOTORISTS
COVERAGE” heading are the words:
   For a covered “auto” licensed or principally ga-
   raged in, or “garaged operations” conducted in
   Illinois, this endorsement modifies insurance
   provided under the following:
   BUSINESS AUTO COVERAGE FORM
   GARAGE COVERAGE FORM
   MOTOR CARRIER COVERAGE FORM
   TRUCKERS COVERAGE FORM
Next, underneath boxes containing the effective date,
named insured, and $300,000 insurance limit, the endorse-
ment states:
   With respect to coverage provided by this endorse-
   ment, the provisions of the Coverage Form apply
   unless modified by the endorsement.
   A. Coverage
       1.     We will pay all sums the “insured” is
              legally entitled to recover as compensatory
8                                                   No. 11-1600

                damages from the owner or driver of an
                “underinsured motor vehicle.”
    ...
    B. Who Is an Insured
          If the Named Insured is designated in the
          Declarations as:
           1.    An individual then the following are
                 “insureds”:
                 a.   The Named Insured and any “family
                      members”.
                 b. Anyone else “occupying” a covered
                    “auto” or a temporary substitute for
                    a covered “auto”. . .
                 c.   Anyone for damages he or she is
                      entitled to recover because of “bodily
                      injury” sustained by another “in-
                      sured.”
Section B.2 provides that if the named insured is “a
partnership, limited liability company, corporation, or any
other form of organization,” then “insureds” include:
                 a.   Anyone “occupying” a covered
                      “auto” or a temporary substitute for
                      a covered “auto.” The covered auto
                      must be out of service because of its
                      breakdown, repair, servicing, “loss”
                      or destruction.
                 b. Anyone for damages he or she is
                    entitled to recover because of “bodily
No. 11-1600                                                  9

                   injury” sustained by another “in-
                   sured.”
   As an initial, and notable, matter, the “Named Insured”
in this case is an individual. Grinnell does not argue
otherwise. The UIM endorsement contains a “Named
Insured” box, and “Shawn Haight” is filled in. He is
also the “Named Insured” on the Business Auto
Coverage Form Declarations. Some of the other docu-
ments refer to “Shawn Haight d/b/a SMH Rebuilding,”
but Grinnell does not contend that those references mean
that the “Named Insured” in the UIM endorsement
is something other than an individual. Indeed, in Illinois,
the “ ‘d/b/a’ designation does not create an entity distinct
from the person operating the business.” See Pekin Ins. Co.
v. Estate of Goben, 707 N.E.2d 1259, 1264 (Ill. App. Ct. 1999);
see also Georgantas v. Country Mut. Ins. Co., 570 N.E.2d
870, 873 (Ill. App. Ct. 1991); Patrevito v. Country Mut. Ins.
Co., 455 N.E.2d 289, 291 (Ill. App. Ct. 1983).
  There is also no dispute that Nicole is a “family mem-
ber” of Shawn Haight under the terms of the endorse-
ment. The UIM endorsement defines “family member” to
include a person related to the named insured by blood
who resides in the named insured’s household. Nicole
was a teenager at the time of the accident, with parents
who shared joint custody, and the parties do not dispute
that she resided with her father for purposes of the
policy. Cf. Casolari v. Pipkins, 624 N.E.2d 429, 432 (Ill. App.
Ct. 1993) (finding under facts before it that minor
whose parents had joint custody resided with father
for insurance policy’s purposes although primary resi-
dence was with mother).
10                                            No. 11-1600

  Because section B.1.a of the UIM endorsement includes
a “family member” as an “insured” when the named
insured is an individual, Nicole maintains that is the
end of the story and that she is entitled to UIM coverage.
Grinnell, however, contends that a read of the policy as
a whole demonstrates that Nicole needed to occupy a
“covered auto” to be afforded UIM coverage. Nicole
was not in a covered auto during the accident, so
Grinnell says she does not receive UIM coverage under
the policy. We conclude that the policy affords UIM
coverage to the individual named insured and his family
members that does not require occupation of a covered
auto. Nicole is therefore entitled to coverage.
  The Business Auto Coverage Form states that the
“insured” means the person qualifying as an insured in
the “Who Is an Insured” provision of the applicable
coverage. The applicable coverage here, the UIM En-
dorsement, states in its “Who Is an Insured” section that
when as here the named insured is an individual, then
pursuant to B.1.a the named insured and any family
members are “insureds.” So Nicole is entitled to
coverage by the terms of B.1.a., as there is no qualifica-
tion in B.1.a that the named insured or family member
must have been occupying a covered auto.
  The lack of such a qualification in B.1.a stands in
contrast to other provisions in the UIM Endorsement’s
“Who Is an Insured” section, including the provision
that immediately follows it. Section B.1.b includes as
“insureds” when the named insured is an individual
“[a]nyone else ‘occupying’ a covered ‘auto’ or a
No. 11-1600                                               11

temporary substitute for a covered ‘auto.’ ” The qualifica-
tion of “occupying a covered auto” could have just as
easily been added to B.1.a, but it was not. Moreover, the
use of the word “else” in B.1.b suggests an intent to
distinguish that category of insured persons from those
in the previous category, B.1.a.
   Section B.1.a also becomes irrelevant if it only applies
to persons “occupying a covered auto.” Cf. Cent. Ill. Light
Co. v. Home Ins. Co., 821 N.E.2d 206, 214 (Ill. 2004) (noting
Illinois courts generally avoid interpretations that
render contract terms surplusage) (citing Dowd & Dowd,
Ltd. v. Gleason, 693 N.E.2d 358 (Ill. 1998)). If Grinnell’s
reading is right, only a single category defining an insured
when the named insured is an individual is neces-
sary–“anyone occupying a covered auto”—and there is no
need for B.1.a. Yet that is not what the policy does in
section B.1; instead, there are distinct provisions in B.1.a
and B.1.b. In contrast, the policy does in fact specify
a single category of persons “occupying a covered auto”
in B.2 of the UIM endorsement, which applies to
business entities. Section B.2.a defines “insureds” when
the named insured is a business entity to include
“[a]nyone ‘occupying’ a covered ‘auto’ or a temporary
substitute for a covered ‘auto.’ ” There is no separate
provision for the named insured or anyone else. Rather,
for business entities, there is a single category for
persons occupying a covered auto.
  This distinction between named insureds who are
individuals and those that are business entities is meaning-
ful in Illinois and makes sense as “corporations cannot
12                                          No. 11-1600

have family members.” Econ. Preferred Ins. Co. v. Jersey
Cnty. Const., Inc., 615 N.E.2d 1290, 1294 (Ill. App. Ct.
1993) (rejecting uninsured motorist claim by daughter
of president of corporation where policy covered “You
or any family member,” policy defined “you” and “your”
as “the person or organization shown as the named
insured,” and the named insured was a corporation); see
also Stark v. Ill. Emcasco Ins. Co., 869 N.E.2d 957, 963
(Ill. App. Ct. 2007) (rejecting UIM claim by corpora-
tion’s sole officer, director, and shareholder where
policy issued to corporation and plaintiff not riding in
covered automobile during accident). Here, though,
the named insured is an individual, and so the “Named
Insured and any ‘family members’ ” category of insureds
in B.1.a has meaning.
  So the text of the “Who Is an Insured” section of the
UIM Endorsement contains no prerequisite of covered
auto occupancy when the named insured is an individ-
ual. Grinnell, however, urges that the words “For
a covered ‘auto’ ” at the very top of the UIM Endorse-
ment mean that a covered auto must be occupied to
qualify for coverage under section B.1.a. It argues that
with those words at the top of the endorsement, there
was no need to add them again in section B.1.a. We,
however, think the better reading is that the sentence
simply designates which coverages the UIM Endorse-
ment modifies, and, therefore, that the phrase only
No. 11-1600                                                      13

applies to the first sentence on the page.1 It is strained
both as a matter of grammar and of logic to read the
prepositional phrase “For a covered auto” to modify
not only words within the same sentence, but also every-
thing in section B.1.a—a section visually and struc-
turally separated from the phrase. (In between there are
two tables containing information about the coverage as
well as a three-paragraph section.) And if Grinnell’s
reading were correct, section B.1.a would become “for a
covered auto, the named insured and any family mem-
bers.” But then B.1.b would read, “for a covered auto,
anyone else occupying a covered auto . . . .” (with a similar
reading in section B.2), an odd result. And the distinctions
between B.1.a, B.1.b, and B.2 would be rendered mean-
ingless. That is not the preferred way to interpret
contract terms. Cf. Cent. Ill. Light Co., 821 N.E.2d at 214.
  Next, the fact that the Business Auto Coverage Form
only deems “insureds” for liability coverage to be
persons who occupy covered autos does not change our
analysis. The “Who Is an Insured” provision in the

1
    The sentence in question is:
      For a covered “auto” licensed or principally garaged in,
      or “garaged operations” conducted in Illinois, this
      endorsement modifies insurance provided under the
      following:
      BUSINESS AUTO COVERAGE FORM
      GARAGE COVERAGE FORM
      MOTOR CARRIER COVERAGE FORM
      TRUCKERS COVERAGE FORM
14                                              No. 11-1600

liability coverage form specifies that persons must be in
a covered auto to be insured. But that is a liability provi-
sion, not a UIM provision, and the form also specifies
that “insured” means the person or organization who
qualifies as an insured in the “Who Is an Insured” provi-
sion of the applicable insurance. The UIM endorsement
has its own provision defining who the insureds are for
its purposes. Grinnell also emphasizes that the declara-
tions page of the Business Auto Coverage Form shows “7”
next to the selected coverages, including UIM coverage,
which signifyies that the coverage only applies to “Specifi-
cally Described ‘Autos.’ ” Our reading does not render
the “7” designation irrelevant. Which autos are covered
can be relevant in determining UIM coverage, including
when sections B.1.b and B.2 apply, so the identity of
covered autos is necessary and relevant there. But when
there is no reference to a “covered auto,” such as in B.1.a,
reference to the list of covered autos is not necessary.
  Grinnell also argues that the language in B.1.b of the
UIM Endorsement is present simply to comply with
the Illinois Motor Vehicle Code. Under Illinois law, a
permissive user of a vehicle must be afforded liability
coverage under the owner’s policy: liability insurance
policies “[s]hall insure the person named therein and
any other person using or responsible for the use of
such motor vehicle or vehicles with the express permis-
sion of the insured.” 625 ILCS 5/7-317(b)(2) (West 2008);
see State Farm Mut. Auto. Ins. Co. v. Smith, 757 N.E.2d
881, 884 (Ill. 2001). As Grinnell points out, other Code
provisions require the inclusion of uninsured and
underinsured motorist coverage in all liability policies,
No. 11-1600                                             15

in minimum amounts set by statute, “for the protection
of persons insured thereunder who are legally entitled to
recover damages from owners or operators of uninsured
motor vehicles.” See 215 ILCS 5/143a-2(1), (4). Where
the insured purchases coverage exceeding the statutory
minimum, liability policies must offer uninsured
coverage up to the liability coverage limit and under-
insured motorist coverage up to the uninsured limit. Id.
   Grinnell argues that section B.1.b merely implements
these statutory requirements. The Grinnell UIM Endorse-
ment, however, does not mention mandatory liability
insurance, liability coverage for permissive drivers of
the insured’s vehicle, or the statutorily required amounts
of coverage. Moreover, the Illinois statute defines an
“underinsured motor vehicle” to mean a vehicle whose
liability limits are less than the UIM limits on the policy
in question, and “whose ownership, maintenance or use
has resulted in bodily injury or death of the insured, as
defined in the policy,” id. § 143a-2(4) (emphasis added),
which shows that reference to the policy is necessary.
The Grinnell policy complies with the requirements of
section 143a-2, but sections B.1.a and B.1.b of the UIM
endorsement do not embody those requirements.
  In short, the UIM Endorsement contains its own defini-
tion of who is insured, and for individuals, that
includes the named insured and family members, with
no requirement that they occupy a covered auto. Our
decision is consistent with decisions in three states that
have interpreted the same policy language. See Reisig
v. Allstate Ins. Co., 645 N.W.2d 544 (Neb. 2002); Stoddard
16                                              No. 11-1600

v. Citizens Ins. Co. of Am., 643 N.W.2d 265 (Mich. Ct. App.
2002); Bushey v. N. Assurance Co. of Am., 766 A.2d 598
(Md. 2001). One state supreme court, however, over a
dissent, construed the same policy language to mean
that a family member must be in a “covered auto” to
receive UIM coverage. Lisowski v. Hastings Mut. Ins. Co., 759
N.W.2d 754 (Wis. 2009). We note that the Lisowski
plaintiff argued that the words “For a covered auto” at the
top of the UIM Endorsement were not part of the policy
and were instead merely introductory language that
should not be given effect, and that Nicole has not made
the same argument here. We agree that the language
should be given effect, but we think the proper effect
is that it is part of a sentence specifying the types of
coverage that the UIM Endorsement modifies.
  Our decision is also consistent with common under-
standing of underinsured motorist insurance. Uninsured
and underinsured motorist policy forms often specify
three classes of insureds, as the form does here. See 3
Alan I. Widiss & Jeffrey E. Thomas, Uninsured and
Underinsured Motorist Insurance § 33.1 (3rd ed. 2005).
Policy terms commonly specify that class 1 insureds
include “both the persons identified as ‘named
insureds’ on the declaration sheet and family members
(including a named insured’s spouse) who are residents
of a named insured’s household.” Id. § 33.2. (As here,
the second class consists of any other person while oc-
cupying a “covered” or “insured” vehicle, and the third
for damages he is entitled to recover because of bodily
injury sustained by a person in class 1 or 2. Id.) As one
treatise explains, “Most significantly, clause/class (1)
No. 11-1600                                                 17

insureds do not have to be an occupant of an insured
vehicle when an injury occurs in order to be covered.” Id.
§ 33.2. This is the common understanding. See also id.
§ 33.5; 16 Williston on Contracts § 49:35 (4th ed. 2009)
(“Uninsured and underinsured insurance provide ‘first-
party’ coverage that is personal and portable, following
the insured, rather than the vehicle.”); cf. Stearns v. Millers
Mut. Ins. Ass’n of Ill., 663 N.E.2d 517, 521 (Ill. App. Ct.
1996), overruled on other grounds by McKinney v. Allstate
Ins. Co., 722 N.E.2d 1125 (Ill. 1999); Haberman v. Hartford
Ins. Group, 443 F.3d 1257, 1268-69 (10th Cir. 2006)
(applying Oklahoma law and concluding that named
insured was covered while riding as passenger in vehicle
not listed on her policy where policy did not limit
UIM coverage to riding in covered vehicles).
  The rationale behind declining to require occupancy in
a covered auto at the time of an accident is to protect
the insured at all times against the risk of damages at
the hands of underinsured motorists. See Howell v Balboa
Ins. Co., 564 So.2d 298 (La. 1990); Nationwide Mut. Ins. Co. v.
Howard, 339 S.E.2d 501, 504 (S.C. 1985) (“Uninsured
motorist coverage is not to provide coverage for the
uninsured vehicle but to afford additional protection to
the insured.”) (citation omitted); see also Janes v. W.
States Ins. Co., 783 N.E.2d 37, 47 (Ill. App. Ct. 2001) (“The
underinsured-motorist coverage a policyholder pur-
chases should not be reduced simply because he is an
occupant of someone else’s vehicle.”). As for the exten-
sion from not only named insureds to relatives, “UM/UIM
coverage for relatives is often mandated by statute
based upon the rationale that an insurer cannot validly
18                                                No. 11-1600

exclude from coverage a class of individuals who are
required to be insured under the liability portion of the
policy.” 9 Lee R. Russ & Thomas F. Segalia, Couch on
Insurance § 123:8 (3rd ed. 2011); see, e.g., Mundey v. Erie
Ins. Group, 914 A.2d 1167, 1177 (Md. 2007) (“We hold,
therefore, that [Md. Code Ann., Ins.] § 19-509 requires
automobile liability insurance contracts to provide unin-
sured motorist coverage, at a minimum, to the named
insured as well as any family members who reside with
the named insured.”); Vaiarella v. Hanover Ins. Co., 567
N.E.2d 916, 918 (Mass. 1991) (“While it has been
remarked that [underinsured motorist] coverage is
‘limited personal accident insurance chiefly for
the benefit of the named insured,’. . , it is clear that the
Legislature intended to include members of the insured
party’s household under this coverage when it passed
G.L. c. 175, § 113L.”) (citations omitted); 16 Richard A.
Lord, Williston on Contracts § 49:35 (4th ed. 2009).
  In Prudential Property and Casualty Insurance Co. v. Colbert,
813 A.2d 747 (Pa. 2002), for example, the Supreme Court
of Pennsylvania considered a son’s claim for UIM
benefits under his parents’ policy after he was injured
while driving a car not listed on his parents’ policy. The
policy only provided for UIM benefits for relatives if
driving a car covered by the policy or a substitute car,
and the son was driving neither. Nonetheless, the
court held that Pennsylvania’s Motor Vehicle Financial
Responsibility Law trumped. The statute defined an
“insured” to include a minor residing in the household
of the named insured, 75 Pa. Cons. Stat. § 1702, and the
court ruled that the insurance policy impermissibly
No. 11-1600                                            19

narrowed the definition of “insured.” Id. at 751. (The
court ultimately upheld the denial of coverage under an
“other household vehicle” exclusion not at issue here. See
id. at 755.) According to its website, Grinnell operates
in Pennsylvania. And according to its counsel, its forms
were created by a national clearinghouse. It would
make sense that the forms were created with the breadth
of national knowledge in mind. In any event, we are
comfortable concluding that under Illinois law, Nicole
Haight is entitled to UIM coverage under the policy
Grinnell issued to her father even though she was not
riding in a covered vehicle at the time of the accident.

                  III. CONCLUSION
 The judgment of the district court is A FFIRMED.

                          9-26-12