Decker v. Great American Ins. Co.

• Decision Date: 31 December 1980
• Docket Number: No. 80-954,80-954
• Parties: Susan DECKER and Dick Decker, her husband, Appellants, v. GREAT AMERICAN INSURANCE COMPANY, Appellee.
• Court: Florida District Court of Appeals

Page 965

392 So.2d 965

Susan DECKER and Dick Decker, her husband, Appellants, v. GREAT AMERICAN INSURANCE COMPANY, Appellee.

No. 80-954.

District Court of Appeal of Florida, Second District.

Dec. 31, 1980.

Rehearing Denied Jan. 22, 1981.

Paul Antinori, Jr. of Antinori & Thury, P.A., Tampa, for appellants.

Michael F. Tew of Barr & Murman, P.A., Fort Myers, for appellee.

CAMPBELL, Judge.

This appeal arises out of an accident between Mrs. Decker and an uninsured motorist. The Deckers seek reversal of an adverse final declaratory judgment which determined the rights of the parties under an insurance policy. The judgment determined that the Deckers were not entitled to underinsured motorist coverage limits in an amount equivalent to the bodily injury limits of the policy. The trial court, in making this determination, strictly construed the language of section 627.727(1), Florida Statutes (1979), as pertaining only to insurance policies delivered or issued for delivery in this state and found that Florida law, specifically section 627.727, does not apply to this case. We disagree and reverse.

On January 12, 1979, the Moore Group of Atlanta employed Mr. Decker, a permanent resident of Florida, as a traveling salesman for the state of Florida. On January 21, 1979, at the company's home office in Atlanta, the Moore Group assigned to Mr. Decker the Toyota automobile which is the insured in this case. The company assigned the car for Mr. Decker to use in connection with company business in Florida. Thereafter, the car was exclusively garaged in Florida.

Mrs. Decker was seriously injured on February 24, 1979, in Tampa, while driving the Toyota to the post office to mail Mr Decker's periodic reports to the Moore Group. Great American Automobile Association carried the insurance on the Toyota pursuant to a policy under which the Moore Group was the named insured.

Great American assumed the insurance coverage on the Moore Group's entire automobile fleet through a policy issued on March 12, 1979, but having a retroactive effective coverage date of February 9, 1979. The record indicates that on March 2, 1979, Great American confirmed to the Moore Group the binding of its automobile fleet with insurance including the $1,000,000 bodily injury limits, effective February 9, 1979. That same communication acknowledged an understanding in regard to Mrs. Decker's accident that "there was a serious loss earlier this week." Great American notified the insured on March 13, 1979, that it was necessary to elect the statutory minimum uninsured motorist coverage and pointed out that in Florida it was $10,000/$20,000 bodily injury only. The insured, Moore Group, made the suggested election in writing on March 16, 1979. The policy itself was mailed from Ohio and delivered to the named insured in Atlanta, Georgia, on March 26, 1979.

The accident, therefore, occurred after February 9, 1979, the effective date of the policy, and prior to March 12, 1979, the date of issuance. The accident was also prior to the named insured's rejection of the maximum uninsured motorist coverage on March 16, 1979.

Also relevant is the fact that on February 23, 1979, Great American mailed to the named insured, the Moore Group, forty automobile insurance identification cards to be used by each "designated" insured, such as Mr. Decker. The forty cards consisted of ten for Florida, twenty for Georgia, and twenty all purpose cards. The insurance policy itself contains a general endorsement applicable to uninsured motorist limits and specifically lists minimum limits in Georgia, Tennessee, Alabama, Oklahoma and Louisiana, but does not mention a limit applicable to Florida.

Great American acknowledged to the Moore Group on March 26, 1979, that it did not require the Moore Group to notify it of interim changes in the schedule of automobiles covered or their location since the policy provided automatic coverage. A general endorsement to the policy extended the policy's coverage to "occurrences taking place anywhere during the policy period."

The insurer, Great American, and the named insured, the Moore Group, are sister companies or wholly owned subsidiaries of a parent company known as American Financial Corporation.

The question before the trial court was whether section 627.727 applies. If section 627.727 does apply, the policy limit in regard to uninsured motorist coverage would be equal to the $1,000,000 bodily injury limit of the policy, absent a prior rejection, particularly since the policy itself was silent as to any such limits as it pertained to coverage in Florida. Lumbermen's Mutual Casualty Co. v. Beaver, 355 So.2d 441 (Fla. 4th DCA 1978).

The pertinent parts of section 627.727 are as follows:

(1) No automobile liability insurance covering liability arising out of the ownership, maintenance, or use of any motor vehicle shall be delivered or issued for delivery in this state with respect to any motor vehicle registered or principally garaged in this state unless coverage is provided therein or supplemental thereto for the protection of persons insured thereunder who are legally entitled to recover damages from owners or operators of uninsured motor vehicles because of bodily injury, sickness, or disease, including death, resulting therefrom. However, the coverage required under this section shall not be applicable when, or to the extent that, any insured named in the policy shall reject the coverage....

(2) The limits of uninsured motorist coverage shall be not less than the limits of bodily injury liability insurance purchased by the named insured, or such lower limit complying with the company's rating plan as may be selected by the named insured Florida Administrative Code rule 4-28.02, ¹ was in effect at the time of the accident. It provided, in regard to increased limits of uninsured motorist coverage, that:

Evidence must be maintained by the company that such coverage was offered in limits up to the bodily injury limits of liability applicable to the policy. The applicant or insured may accept limits for uninsured motorist coverage in an amount less than the bodily injury limits of the policy.

Florida courts seem to hold uniformly that rejection of the increased uninsured motorist coverage must be an "informed rejection." Aetna Casualty & Surety Co. v. Green, 327 So.2d 65 (Fla. 1st DCA 1976). There is a division, however, as to whether Florida Administrative Code rule 4-28.02, required that rejection to be in writing. The First District has not required written rejection. Glover v. Aetna Insurance Co., 363 So.2d 12 (Fla. 1st DCA 1978). But see American Motorists Insurance Co. v. Weingarten, 355 So.2d 821 (Fla. 1st DCA 1978). The Third District has required rejection to be in writing. Cohen v. American Home Assurance Co., 367 So.2d 677 (Fla. 3d DCA 1979); Lumbermen's Mutual Casualty Co. v. Beaver, 355 So.2d 441 (Fla. 4th DCA 1978). The Federal courts have also required written rejection. Harris v. United States Fidelity & Guaranty Co., 569 F.2d 850 (5th Cir. 1978). We find that the better rule would be to require a written rejection. Since in this case the insurance policy was silent as to any reduced uninsured motorist coverage for Florida, the amount equivalent to the bodily injury liability coverage, as is provided for in the Florida statute, would apply, if the statute is applicable, regardless of whether there was some attempt at rejection prior to the written rejection. See American Motorists Insurance Co. v. Weingarten.

In Manchester Insurance & Indemnity Co. v. Jones, 317 So.2d 786 (Fla. 3d DCA 1975), which involved facts similar to those, here, the court decided against the insurer. The insured had made a deposit on a policy of automobile insurance. Shortly thereafter he was involved in an accident. After the accident and while he was in the hospital, he signed a rejection of uninsured motorist...