McClure v. Employers Mut. Cas. Co.
| Decision Date | 21 January 1976 |
| Docket Number | No. 2--56962,2--56962 |
| Citation | 238 N.W.2d 321 |
| Parties | Maxine McCLURE, now known as Maxine Greenhalgh, Administrator of the Estate of Gale McClure, Deceased, Appellant, v. EMPLOYERS MUTUAL CASUALTY COMPANY and Motor Club of Iowa Insurance Company, Appellees. |
| Court | Iowa Supreme Court |
Patterson, Lorentzen, Duffield, Timmons, Irish & Becker, Des Moines, and Hoffman, Hoffman & Stewart, Leon, for appellant.
Bradshaw, Fowler, Proctor & Fairgrave, by William F. Fanter, Des Moines, for appellee Employers Mut. Cas. Co.
Joseph A. Billings, Des Moines, for appellee Motor Club of Iowa Ins. Co.
Considered en banc.
This case involves 'stacking' of insurance policies, among other issues.
Gale McClure met death in a collision of a motor vehicle in which he was riding and a motor vehicle operated by a negligent uninsured motorist. McClure's dependent widow as such received workmen's compensation benefits of $10,094.17. The probate court appointed the widow as administrator of McClure's estate. In a separate action by the administrator against the uninsured motorist, the district court adjudged the damages to McClure's estate resulting from his death to be $30,000. The administrator then brought the present action to recover uninsured motorist insurance.
Defendant Employers Mutual Casualty Company insured the motor vehicle in which McClure was riding. The City of Creston, Iowa, owned the vehicle and is the named insured. McClure is an insured under that policy, which provides uninsured motorist coverage up to $10,000 for each person and up to $20,000 for each accident. In addition, McClure is a named insured under a policy on his own car. Defendant Motor Club of Iowa Insurance Company issued that policy, which covered McClure while riding in other motor vehicles and provided similar $10,000--$20,000 uninsured motorist coverage. The parties raise no issue about the approval of these policies by the Iowa Insurance Commissioner.
The administrator sued each insurer for $10,000, for a total of $20,000. The trial court held for the insurers and dismissed the petition. The administrator appealed.
The word and figure 'Part' or 'Part IV' in the policies means the policy part relating to uninsured motorist insurance, and the words 'bodily injury' include death.
Employers Mutual's policy contains an 'other insurance' clause which states:
Other Insurance. With respect to bodily injury to an insured while occupying an automobile not owned by the named insured, the insurance under Part IV shall apply only as excess insurance over any other similar insurance available to such insured and applicable to such automobile as primary insurance, and this insurance shall then apply only in the amount by which the limit of liability for this coverage exceeds the applicable limit of liability of such other insurance.
Except as provided in the foregoing paragraph, if the insured has other similar insurance available to him and applicable to the accident, the damages shall be deemed not to exceed the higher of the applicable limits of liability of this insurance and such other insurance, and the company shall not be liable for a greater proportion of any loss to which this Coverage applies than the limit of liability hereunder bears to the sum of the applicable limits of liability of this insurance and such other insurance.
Motor Club's policy also contains an other insurance clause. This clause states:
Other Insurance. With respect to bodily injury to an insured while occupying an automobile not owned by the named insured the insurance hereunder shall apply only as excess insurance over any other similar insurance available to such occupant, and this insurance shall then apply only in the amount by which the applicable limit of liability of this Part exceeds the sum of the applicable limits of liability of all such other insurance.
With respect to bodily injury to an insured while occupying or through being struck by an uninsured automobile, if such insured is a named insured under other similar insurance available to him, then the damages shall be deemed not to exceed the higher of the applicable limits of liability of this insurance and such other insurance, and the company shall not be liable under this Part for a greater proportion of the applicable limit of liability of this Part than such limit bears to the sum of the applicable limits of liability of this insurance and such other insurance.
Subject to the foregoing paragraphs, if the insured has other similar insurance available to him against a loss covered by this Part, the company shall not be liable under this Part for a greater proportion of such loss than the applicable limit of liability hereunder bears to the total applicable limits of liability of all valid and collectible insurance against such loss.
In addition, Employers Mutual's policy contains a workmen's compensation clause:
Any amount payable under the terms of this Part because of bodily injury sustained in an accident by a person who is an insured under this Part shall be reduced by . . . the amount paid and the present value of all amounts payable on account of such bodily injury under any workmen's compensation law, disability benefits law or any similar law.
Motor Club's policy contains a similar though not identical workmen's compensation clause, but we need not set it out.
The appeal presents two main questions: (1) Is the administrator entitled to recover at most $10,000 or $20,000 of uninsured motorist insurance? and (2) Is the workmen's compensation of $10,094.17 to be deducted from such $10,000 or $20,000? The first question involves the other insurance clauses in the two policies, while the second question involves Employers Mutual's workmen's compensation clause.
I. The 'Other Insurance' Clauses. The effect of the pertinent paragraph of each of the other insurance clauses before us is to restrict the administrator to a maximum recovery of $10,000 of uninsured motorist insurance, provided that one or both of those pertinent paragraphs are valid and applicable. The pertinent paragraphs, as we shall see, are the second paragraph of Employers Mutual's other insurance clause and the first paragraph of Motor Club's other insurance clause. We turn first to the Validity of the other insurance clauses.
A. In common with a number of states, Iowa has a statute requiring motor vehicle liability insurance policies to contain uninsured motorist coverage unless expressly rejected by the named insured, § 516A.1, Code 1975:
No automobile liability or motor vehicle liability insurance policy insuring against liability for bodily injury or death arising out of the ownership, maintenance, or use of a 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 in such policy or supplemental thereto, for the protection of persons insured under such policy who are legally entitled to recover damages from the owner or operator of an uninsured motor vehicle or a hit-and-run motor vehicle because of bodily injury, sickness, or disease, including death resulting therefrom, caused by accident and arising out of the ownership, maintenance, or use of such uninsured motor vehicle, or arising out of physical contact of such hit-and-run motor vehicle with the person insured or with a motor vehicle which the person insured is occupying at the time of the accident. Such coverage shall include limits for bodily injury or death at least equal to those stated in subsection 10 of section 321A.1 of the Code ('$10,000--$20,000' coverage). The form and provisions of such coverage shall be examined and approved by the commissioner of insurance.
However, the named insured shall have the right to reject such coverage by written rejections signed by the named insured. If such rejection is made on a form or document furnished by an insurance company or insurance agent, it shall be on a separate sheet of paper which contains only such rejection and information directly related thereto. Such coverage need not be provided in or supplemental to a renewal policy where the named insured has rejected such coverage in connection with a policy previously issued to him by the same insurer.
See Holland v. Hawkeye Security Ins. Co., 230 N.W.2d 517 (Iowa); Langstraat v. Midwest Mut. Ins. Co., 217 N.W.2d 570 (Iowa); Benzer v. Iowa Mut. Tornado Ins. Assn., 216 N.W.2d 385 (Iowa); Rodman v. State Farm Mut. Auto. Ins. Co., 208 N.W.2d 903 (Iowa); Western Cas. & Sur. Co. v. General Cas. Co. of Wis., 200 N.W.2d 892 (Iowa); Burcham v. Farmers Ins. Exch., 255 Iowa 69, 121 N.W.2d 500; Simpson v. State Farm Mut. Auto. Ins. Co., 318 F.Supp. 1152 (S.D.Ind.) (tracing development of Iowa law on this subject); Neighbor, Pyramiding Uninsured Motorist Coverage--Has Iowa Joined the Majority? 2o Drake L.Rev. 746.
A few states have enacted additional provisions on this subject, authorizing policy clauses which eliminate duplication of insurance or benefits in various ways: e.g., Cal.Ins.Code (1975 Supp.) § 11580.2(d) and (h) (); S.C.Code (1974 Cum.Supp.) § 46--750.38 (); Tenn.Code Ann. (Supp.1974) § 56--1152. The Iowa legislature enacted such a provision in a second section of the uninsured motorist insurance chapter, now § 516A.2 of the Code. This section closely resembles a corresponding section in Tennessee. See Shoffner v. State Farm Mut. Auto. Ins. Co., 494 S.W.2d 756 (Tenn.). Section 516A.2, consisting of two sentences, is at the heart of the first part of the present controversy. The first sentence states:
Nothing contained in this chapter shall be construed as requiring forms of coverage provided pursuant hereto, whether alone or in combination with similar coverage afforded under other automobile...
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