Brandi Fipps v. Progressive Universal Insurance Company

• Court: Court of Appeals of Iowa
• Decided: November 2, 2022
• Docket: 21-1105
• Status: Published

Opinion

IN THE COURT OF APPEALS OF IOWA

No. 21-1105 Filed November 2, 2022

BRANDI FIPPS, Plaintiff-Appellant,

vs.

PROGRESSIVE UNIVERSAL INSURANCE COMPANY, Defendant-Appellee. ________________________________________________________________

Appeal from the Iowa District Court for Harrison County,

Craig M. Dreismeier, Judge.

Brandi Fipps appeals the grant of summary judgment in favor of her motor

vehicle insurer. AFFIRMED.

Thomp J. Pattermann of the Law Office of Gallner & Pattermann, P.C.,

Council Bluffs, for appellant.

Patrick L. Sealey and of Heidman Law Firm, P.L.L.C., Sioux City, for

appellee.

Considered by Bower, C.J., and Schumacher and Ahlers, JJ. 2

AHLERS, Judge.

This appeal calls for us to address what obligations a motor vehicle liability

insurance carrier has to provide underinsured motorist (UIM) coverage when a

vehicle is replaced under the policy and the insured previously rejected UIM

coverage.

Brandi Fipps purchased motor vehicle insurance from Progressive

Universal Insurance Company (Progressive) covering a pickup effective June 30,

2017. When purchasing the policy, Fipps rejected uninsured motorist (UM) and

UIM coverage.1 See Iowa Code § 516A.1 (2017) (requiring motor vehicle liability

insurance policies to provide UM and UIM coverage unless the named insured

rejects the coverage). Effective July 24, Fipps replaced the pickup with a sport

utility vehicle (SUV). A series of documents titled “Declarations Page,” dated

June 30, July 24, August 20, and September 3, each specifically stated Fipps

rejected UIM coverage on the covered vehicle and that the policy was effective

June 30 until December 30.

A little more than a month after substituting vehicles under the policy, Fipps

was injured in a motor vehicle collision while driving the SUV. Fipps sought

damages for her injuries. She settled her claim against the other driver and then

sought UIM coverage under her policy with Progressive. Progressive denied

coverage on the basis that Fipps did not have UIM coverage under the policy

because she had rejected it. Fipps sued Progressive, claiming breach of the

insurance contract. Progressive sought summary judgment. The district court

1 The validity of Fipps’s rejection of the UIM coverage is not at issue in this case. 3

granted summary judgment and dismissed Fipps’s suit. Fipps appeals.

I. Standard of Review

We review rulings granting summary judgment for correction of errors at

law. Garrison v. New Fashion Pork LLP, 977 N.W.2d 67, 76 (Iowa 2022). We

“view the facts in the light most favorable to the nonmoving party” and “consider

on behalf of the nonmoving party every legitimate inference reasonably deduced

from the record.” Id. (quoting Morris v. Legends Fieldhouse Bar & Grill, LLC, 958

N.W.2d 817, 821 (Iowa 2021)). Summary judgment is properly granted if the

moving party shows “there is no genuine issue as to any material fact and the

moving party is entitled to judgment as a matter of law.” Id. (quoting EMC Ins. Grp.

v. Shepard, 960 N.W.2d 661, 668 (Iowa 2021)).

II. Analysis

The material facts are not disputed. Instead, Fipps argues she never

rejected UIM coverage for the SUV and thus Progressive was required to provide

UIM coverage for the SUV under Iowa law.

Fipps’s argument requires us to construe and interpret her insurance policy

in conjunction with the controlling statute. See Thomas v. Progressive Cas. Ins.

Co., 749 N.W.2d 678, 681 (Iowa 2008) (“The construction of an insurance policy

is the process of determining the policy’s legal effect; interpretation is the process

of determining the meaning of the words used in the policy.”). We say in

conjunction with the controlling statute because “[w]hen a statute authorizes a

contract of insurance, ‘[t]he statute itself forms a basic part of the policy and is

treated as if it had actually been written into the policy.’” Id. at 682 (second

alteration in original) (quoting Lee v. Grinnell Mut. Reins. Co., 646 N.W.2d 403, 4

406 (Iowa 2002)). “Consequently, when construing a contract provision that

affects [UIM] coverage, we must review not only the language of the policy but the

terms of the UIM statute, Iowa Code chapter 516A, as well.” Id. Chapter 516A “is

written to protect the insurance consumer, not the policy vendor.” Rodman v. State

Farm Mut. Auto. Ins. Co., 208 N.W.2d 903, 909 (Iowa 1973). When interpreting

language in a statute and an insurance contract, “the court strives to determine

intent, the legislature’s intent in the case of a statute and the parties’ intent in the

case of a contract.” Thomas, 749 N.W.2d at 683 n.5. We avoid “straining the

words or phrases of the policy ‘to impose liability that was not intended and was

not purchased.’” Id. at 682 (quoting Cairns v. Grinnell Mut. Reins. Co., 398 N.W.2d

821, 825 (Iowa 1987)).

As the policy must be read in conjunction with the statute, we start with the

words of the statute. Iowa Code section 516A.1(1)2 states:

No automobile liability or motor vehicle liability insurance policy . . . shall be delivered or issued for delivery 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 [or underinsured] motor vehicle . . . caused by accident and arising out of the ownership, maintenance, or use of such uninsured or underinsured motor vehicle.

At a broad level, this provision requires motor vehicle liability policies issued by

insurers such as Progressive to include UM and UIM coverage. However,

section 516A.1(2) allows the insured to reject such coverage:

2 A 2021 amendment numbered the previously unnumbered paragraphs of section 516A.1. 2021 Iowa Acts ch. 76, § 150(6). Section 516A.1 is otherwise unchanged since 2017. For clarity, we use the current numbering of section 516A.1. 5

However, the named insured may reject all of such coverage, or reject the uninsured motor vehicle (hit-and-run motor vehicle) coverage, or reject the underinsured motor vehicle coverage, by written rejections signed by the named insured. If rejection is made on a form or document furnished by an insurance company or insurance producer, it shall be on a separate sheet of paper which contains only the rejection and information directly related to it. Such coverage need not be provided in or supplemental to a renewal policy if the named insured has rejected the coverage in connection with a policy previously issued to the named insured by the same insurer.

There is no dispute that Fipps rejected UM and UIM coverage when she

first purchased the policy. Fipps’s claim is that when she sought coverage for the

SUV coverage for that vehicle resulted in a new policy, which triggered

Progressive’s obligation to provide UM and UIM coverage unless Fipps rejected

such coverage and Fipps did not do so. Progressive counters by arguing the

substitution of the SUV for the pickup under the policy did not result in a new policy;

it was merely a continuation of the existing policy.

To resolve the dispute over whether this is a new policy, we start with the

plain language of section 516A.1(1), which requires an insurer to provide UIM

coverage when the “policy” is “delivered or issued for delivery.” Chapter 516A

does not define “policy,” “deliver,” or “issue,” so we look to dictionary definitions for

guidance. See State v. Middlekauff, 974 N.W.2d 781, 793 (Iowa 2022) (noting

that, if the legislature has not provided a definition, we may refer to case law,

similar statutes, dictionaries, and common usage to determine a definition).

“Policy” in this context means “[a] document containing a contract of insurance.”

Policy, Black’s Law Dictionary (11th ed. 2019). “Deliver” means to “transfer[ ]

something.” Delivery, Black’s Law Dictionary (11th ed. 2019). “Issue” means “[t]o

send out or distribute officially.” Issue, Black’s Law Dictionary (11th ed. 2019). 6

Thus, section 516A.1(1) only requires an insurer to obtain a rejection of UIM

coverage when a document containing a contract of insurance is transferred or

sent out. Nothing in the statute requires an insurer to obtain a UIM rejection at

other times under the same policy. Likewise, nothing in chapter 516A or the

general definition of “policy” requires a new “policy” when providing coverage on a

different vehicle. Additionally, our supreme court has found UIM coverage is

generally “personal and portable” and “protects and follows the person, not the

vehicle.” Hornick v. Owners Ins. Co., 511 N.W.2d 370, 372 (Iowa 1993). So, the

statute does not support Fipps’s claim.

Furthermore, the record establishes that the parties treated coverage on the

SUV as a continuation of the same policy and not an entirely new policy. Each

Declarations Page shows the same policy continued through the removal of the

pickup and the addition of the SUV with the same policy number and the same

effective dates.

Also, while the statute is silent on the topic of replacement vehicles, the

policy is not. See, e.g., Whicker v. Goodman, 576 N.W.2d 108, 110–11 (Iowa

1998) (looking to the policy to resolve coverage issues not addressed by the

statute). The policy’s language shows that the parties anticipated changes to the

motor vehicles covered by the policy. Under the insuring agreement, UIM

coverage is available to authorized persons in a “covered auto.” The policy defines

“covered auto” to include a “replacement auto.” The policy defines “replacement

auto” as “an auto that permanently replaces an auto shown on the declarations

page.” The policy also states the replacement auto “will have the same coverage

as the auto it replaces.” There is no dispute that the SUV replaced the pickup, so 7

the SUV meets the policy’s definition of “replacement auto.” By the terms of the

policy, the replacement auto “will have the same coverage as the auto it replaces.”

As Fipps rejected UIM coverage on the pickup, the SUV also lacked UIM coverage.

See Seiple v. Progressive N. Ins. Co., 954 F. Supp. 2d 352, 356–60 (E.D. Pa.

2013) (analyzing similar policy language and concluding that adding a new vehicle

to an existing policy does not trigger an obligation for the insurer to obtain a new

rejection of UIM coverage under Pennsylvania law). Finally, even if it was possible

for Fipps to cancel the original policy covering the pickup and begin a new policy

covering the SUV, nothing in the record suggests she attempted to do so rather

than continuing the existing policy.

For all of these reasons, we find Progressive was not obligated to obtain an

additional waiver of UIM coverage on the SUV.

III. Conclusion

The record establishes Fipps rejected UIM coverage when beginning the

motor vehicle insurance policy on the pickup, and nothing in the insurance

documents or Iowa law requires Progressive to begin a new policy or otherwise

obtain a new rejection of UIM coverage to provide coverage on the replacement

SUV. Therefore, we affirm the grant of summary judgment dismissing Fipps’s

claim for UIM coverage.

AFFIRMED.