Robert Weber v. American Family Mutual Insurance Company

868 F.2d 286, 1989 U.S. App. LEXIS 1784, 1989 WL 11696

• Court: Court of Appeals for the Eighth Circuit
• Decided: February 17, 1989
• Docket: 88-1082
• Status: Published

Opinions

BEAM, Circuit Judge.

Robert Weber appeals the adverse judgment of the district court. We reverse.

I. BACKGROUND

Robert Weber was a passenger in a car driven by Rebecca Wallace which car was involved in a collision with another vehicle. Wallace made a left turn in violation of the traffic signal and turned into the path of an oncoming car. As a result of the accident, Weber suffered severe injuries.

At the time of the accident Weber had an automobile liability policy issued by American Family Mutual Insurance Company which policy included underinsured motorist coverage in the amount of $100,000. After settling with Wallace’s insurance carrier for $100,000, the policy limits, Weber sued American Family for the damages he incurred which exceeded the amount he had received from Wallace.

Prior to trial the parties stipulated that if Weber was entitled to recover under the underinsured motorist coverage extended by the American Family policy, he would recover $60,000. In addition, the parties stipulated to the facts of the case leaving only the question of whether Weber had to setoff any amounts received from Wallace’s insurance carrier against any amounts due from American Family. The district court held that, pursuant to the language of Weber’s policy, set-off was required. The end result was a zero amount payable by American Family. We disagree with this result.

II. DISCUSSION

Weber’s underinsured motorist coverage stated that American Family would pay “damages for bodily injury which an insured person is legally entitled to recover from the owner or operator of an underin-sured motor vehicle.” The policy further provided that “[a]ny amounts payable [under the underinsured motorist coverage] will be reduced by * * * [any] payment made by the owner or operator of the underinsured motor vehicle or organization which may be legally liable.”

Weber claims that this language clearly indicates that the underinsured motorist coverage is excess coverage over and above any amounts received as a result of liability policies of the driver who was at fault. American Family asserts that the language in Weber’s policy concerning the underin-sured motorist coverage explicitly states that any amounts Weber received from Wallace or her insurance company must be set-off against the $100,000 coverage Weber had with American Family. Therefore, because Weber received $100,000 from Wallace’s insurance carrier, and Weber’s policy limits were $100,000, Weber is not entitled to any additional amounts from American Family.

To further illustrate its point, American Family urges us to compare the language in Weber’s policy with the language American Family used in earlier policies. Earlier policies stated that “[t]he coverage provided * * * is excess over any collectible auto liability insurance.” American Family contends that such a comparison clearly establishes that it did not intend Weber’s under-insured motorist coverage to be excess over any amounts received from Wallace or her insurance carrier, and that the policy language was changed to reflect that intent. We disagree. We believe the new language represents nothing more than an attempt to frame an excess coverage clause in other language. Any other analysis would render the policy term “underin-sured motor vehicle” meaningless or, at least, misleading. For instance, under American Family’s interpretation, an insured, such as Weber, would never reach the limits of liability set forth in the Under-insured Motorist Coverage Endorsement of the contract unless the insured was dealing with an uninsured motorist rather than an underinsured motorist.

Under the policy, American Family agreed, as earlier indicated, to pay the full amount that Weber was legally entitled to recover from Wallace. The parties have stipulated that this amount is $160,000. The $160,000 is then reduced, pursuant to the terms of the policy, by the payment Weber received from Wallace’s insurance carrier, i.e., $100,000, leaving an amount due Weber of $60,000. This amount is, of course, within the policy limits of $100,000 as established by the policy.

Accordingly, we find that Weber is entitled to $60,000 under his underinsured motorist policy in addition to the $100,000 Weber received from Wallace’s insurance company.

III. CONCLUSION

For the reasons stated above, we reverse the judgment of the district court and remand this matter for further action consistent with this opinion.