If your mother, we’ll call her Barbara, was involved in a car accident with another negligent driver, we’ll call him Bellville, and she later died from her injuries, you might want to sue for her wrongful death. Let's say you do sue and Bellville’s insurance company ponies up $1,000,000.00, which is the entirety of Bellville’s policy (or what we call the limit). Now, you are still upset and you think $1,000,000 is not enough for the life of your beloved mother—besides, your personal injury attorney received anywhere from a quarter to a half of it and medical bills also were deducted.
You quickly realize that you have your own insurance policy which has “under-insured motorist” coverage, abbreviated to “UM”. Hey—your mother was worth more than $1,000,000 and so clearly the other driver was under-insured because his policy limit was a measly one million. You, or your lawyer, cleverly decide to try to get your insurance company to pay more with the idea that your insurance company should pay you for the death of your mother.
Your mean-spirited insurance company then says, “No way! Your under-insured motorist coverage only pays you when someone hits you. It does not pay you if someone hits your mother. Your mother was not insured under your policy.”
But then you, or your brilliant attorney, argue that you ought to still be entitled and so you sue your insurance company under that theory. And, voila, your local elected judge agrees with you! Magic! You are entitled to more compensation! Did you see that coming? Well, many lawyers might see that coming since elected judges answer to citizens who vote and also gossip with other citizens about a judge’s merit, but insurance companies are not citizens who vote (but let us not get too carried away with local politics because insurance companies lobby congress and probably buy legislative votes on laws that favor them on a much larger scale than locally).
So, you have won another financial victory in honor of your dead mother. Or have you? Don’t celebrate too quickly. The insurance company appeals the district court judge’s ruling in your favor and the mean-spirited Nevada Supreme Court actually agrees with your mean-spirited insurance company. Mean-spirited people often think alike, don’t they? Therefore, the moral of this story is that your UM coverage is for you and others that are listed as insureds in your policy, but do not cover people who are not listed, no matter how near and dear they are to you.
This scenario is more boringly but fully described in the case Allstate Insurance Company v. Fackett.
Copyright: August 22, 2009
By: Anthony M. Wright, JD