Muehlenbein v. West Bend Mut. Ins. Co., 92-1855

• Decision Date: 10 March 1993
• Docket Number: No. 92-1855,92-1855
• Citation: 499 N.W.2d 233,175 Wis.2d 259
• Parties: Mark J. MUEHLENBEIN and Dawn Muehlenbein, Plaintiffs-Appellants, d v. WEST BEND MUTUAL INSURANCE COMPANY, Defendant-Respondent, Mary Ann Kocian and Allstate Insurance Company, Defendants.
• Court: Wisconsin Court of Appeals

Page 233

499 N.W.2d 233

175 Wis.2d 259

Mark J. MUEHLENBEIN and Dawn Muehlenbein, Plaintiffs-Appellants, ^d v. WEST BEND MUTUAL INSURANCE COMPANY, Defendant-Respondent, Mary Ann Kocian and Allstate Insurance Company, Defendants.

No. 92-1855.

Court of Appeals of Wisconsin.

Submitted on Briefs Jan. 15, 1993.

Opinion Released March 10, 1993.

Opinion Filed March 10, 1993.

Before NETTESHEIM, P.J., and BROWN and SNYDER, JJ.

BROWN, Judge.

Mark J. and Dawn Muehlenbein appeal from an order granting summary judgment to West Bend Mutual Insurance Company. The trial court determined as a matter of law that West Bend was not liable for an underinsured motorist payment under its commercial umbrella policy. The issue is whether an endorsement to this insurance policy expanded the scope of the policy, when the body of the policy was clear and unambiguous and did not mention the coverage excluded by the endorsement. We hold that such an endorsement clarifies but does not expand the scope of the insurance policy. We therefore affirm the trial court.

The relevant facts are brief. Mark was seriously injured while driving a vehicle owned by his employer. The vehicle was insured under a commercial automobile insurance policy and an umbrella policy issued by West Bend. Mark received the policy limit of $50,000 for underinsured motorists under the automobile policy. Mark also received the policy limits of $100,000 from Allstate Insurance Company, which insured the car that hit him. The Muehlenbeins then attempted to claim additional underinsured motorist coverage under West Bend's umbrella policy.

The umbrella policy contains an endorsement labeled "Uninsured/Underinsured Motorist Coverage Exclusion." The endorsement reads, "We do not cover any claim or obligation imposed by an Uninsured or Underinsured Motorists law, or which is covered by the Uninsured or Underinsured Motorist coverage part of any insurance policy covering you as an insured person." Uninsured or underinsured motorist coverage is not mentioned anywhere else in the umbrella policy. The commercial automobile policy, however, contains a detailed endorsement regarding uninsured motorist insurance.

West Bend moved for summary judgment, claiming that the umbrella policy endorsement clearly excludes payment for uninsured or underinsured motorists. The trial court granted partial summary judgment to West Bend. The court stated:

As to whether the commercial umbrella policy provides underinsured motorist coverage, I conclude it does not, because the policy is for the purpose only of providing indemnity to the insured for obligations to pay which result from liability stemming from certain specified acts or instances. The policy does not contain any insuring agreement to provide underinsured motorist coverage. The purpose of the policy is to provide coverage for liability only, and the sole mention of underinsured motorist coverage in the policy is in an endorsement which clearly and unambiguously states that no such coverage exists.... Any reasonable insured would understand that the endorsement contained in the policy excluded coverage rather than providing it. [Emphasis in original.]

The Muehlenbeins now appeal. All other issues have been resolved by stipulation of the parties.

We will affirm a summary judgment if the record contains no genuine issue of material fact, entitling the moving party to judgment as a matter of law. St. John's Home v. Continental Casualty Co., 147 Wis.2d 764, 781-82, 434 N.W.2d 112, 119 (Ct.App.1988). Our review is de novo, without deference to the trial court. Id. at 782, 434 N.W.2d at 119.

The interpretation of words or clauses in an insurance contract is a question of law. Dipasquale v. American Family Ins. Co., 168 Wis.2d 75, 78-79, 483 N.W.2d 231, 233 (Ct.App.1992). Insurance contracts are controlled by the same rules of construction as are other contracts; the goal is to ascertain the intentions of the parties. Wood v. American Family Mut. Ins. Co., 148 Wis.2d 639, 652, 436 N.W.2d 594, 599 (1989). If the language of the contract is unambiguous, then we apply its terms without engaging in construction. Dipasquale, 168 Wis.2d at 79, 483 N.W.2d at 233.

The Muehlenbeins argue that the language of the uninsured/underinsured motorist exclusion is ambiguous. Therefore, the exclusion endorsement must be harmonized with the rest of the policy. They assert that "the language of this endorsement clearly seems to state that underinsured motorist coverage is excluded under the commercial umbrella policy only to the extent that the insured is covered by the uninsured or underinsured motorist coverage part of any other policy covering the insured." Unless the endorsement is interpreted to provide excess coverage, the Muehlenbeins argue that the clause becomes meaningless.

In response, West Bend observes that the exclusion endorsement clearly and unambiguously precludes uninsured and underinsured motorist coverage. West Bend also asserts, "in light of the clear absence of underinsured motorist coverage in the insuring agreement, the exclusion endorsement really is not legally necessary to preclude underinsured motorist recovery." West Bend states that the Muehlenbeins are "attempt[ing] to conjure up an ambiguity and thus create coverage where none exists." It points out that although policy language is to be construed against the insurer, such construction should not be strained construction. See Bankert v. Threshermen's Mut. Ins. Co., 105 Wis.2d 438, 444, 313 N.W.2d 854, 857 (Ct.App.1981), aff'd, 110 Wis.2d 469, 329 N.W.2d 150 (1983).

We conclude that, rather than creating an ambiguity, the endorsement at issue in this case actually eliminates a potential ambiguity in the body of the umbrella policy. We determine this by reading the language of the policy and the endorsement as it would be read by a reasonable person in the position of the insured. See Bertler v. Employers Ins., 86 Wis.2d 13, 17, 271 N.W.2d 603, 605 (1978). We give the words their common and ordinary meaning. Id. at 18, 271 N.W.2d at 605. We may look to dictionary definitions when determining the plain meaning of words in an insurance contract. Holsum Foods Div. of Harvest States Coops. v. Home Ins. Co., 162 Wis.2d 563, 569, 469 N.W.2d 918, 921 (Ct.App.1991). We must also take into account the kind of insurance afforded by the policy when determining the meaning of its provisions. See Bulen v. West Bend Mut. Ins. Co., 125 Wis.2d 259, 264-65, 371 N.W.2d 392, 394 (Ct.App.1985); see also R. LONG, THE LAW OF LIABILITY INSURANCE § 1.01 at 1-2, 1-3 (1992).

An endorsement is "a provision added to an insurance contract altering its scope or application that takes precedence over printed portions of the policy in conflict therewith." WEBSTER'S THIRD NEW INTERNATIONAL DICTIONARY 749 (unabr. 1976). An exclusion is a clause that subtracts from coverage and puts a reasonable person on notice that coverage will be limited. Bulen, 125 Wis.2d at 263, 371 N.W.2d at 394.

Thus, West Bend's exclusion endorsement is a clause that alters the terms of the umbrella policy by subtracting from the coverage available in the body of the policy. The Muehlenbeins argue that the lack of mention of uninsured or underinsured motorist coverage in the umbrella policy creates an ambiguity with respect to the exclusion. They claim that coverage cannot be subtracted from if it does not exist in the first instance. They ask us to imply uninsured and underinsured motorist coverage into the umbrella policy to resolve the claimed ambiguity. This reading, they suggest, is consistent with the policy of construing ambiguities in an insurance policy against the insurer. S...