The latest battle in the UM/UIM coverage wars.

For those who’ve not been following the action closely, uninsured and underinsured coverage must by statute (20-259.01B) be offered and refused in writing. People who refuse it and later, after an accident, find themselves in need of it must therefore get creative. Some argue that they did have the coverage because the offer or refusal wasn’t valid (e.g., here and here). The Wilks took a different tack, admitting that they didn’t have the coverage and suing the insurance agent for not selling it to them. The agent moved for summary judgment, arguing that under 20-259.01B it fulfilled its obligations by offering the coverage and obtaining the Wilks’ written refusal. The trial court granted the motion.

The Court of Appeals reverses. The Wilks said they wanted the same coverage that they had in a prior policy, which included UIM. They had an “expert” who opined that when clients want the same coverage they had before the agent should sell them the same coverage they had before (an odd item, we would have thought, for an expert opinion; maybe you had to be there). And the agent allegedly told the Wilks that he had indeed provided them the same coverage they had before. The court says that this is a valid negligence claim.

It then analyses, separately, whether following the statute protects the agent from liability. Why the court does this, having already found that the agent isn’t protected from liability, isn’t clear. Our guess is that perhaps this is the way the case was briefed and the court just followed along. (As we have said before, we think that’s good practice and what courts should normally do – with the proviso that if the briefs are poor the opinion has to improve on them.) The court holds, based on statutory language and history, that complying with its procedures protects the insurer but not the agent.

The “special concurrence” agrees with the first part of the majority opinion but doesn’t think the separate statutory analysis necessary (and indicates that it would disagree with it if it were). (Once upon a time the judge would have been described as “concurring in part,” or even “dissenting in part.” Apparently the  court’s present software has only a “specially concurring” button. This is doubly a shame because it hides, rather than signals, the judge’s position and because it lumps perfectly serviceable separate opinions like this one with unfortunate exercises like this one.)

The court remands and will let a jury deal with a factual position that doesn’t actually make a huge amount of sense. The Wilks don’t deny that the agent explained UM/UIM coverage and that they signed the denial form – although they weren’t paying attention/don’t remember/etc. – nor that, based on the agent’s advice, they also omitted other coverages contained in the prior policy. Apparently the argument is that the alleged subjective motivation that sent them to the agent – to get the same thing they had before – overrides the actions they took while there.

(The Wilks also said they wanted “full coverage” but this isn’t really a full-coverage case; what they wanted, allegedly, was what they had before to the extent it included UIM coverage. The notion that they wanted “full coverage” probably hurts their case more than helps it since they knowingly and admittedly didn’t buy full coverage. Its funny how the phrase “full coverage,” which has become a mantra among lawyers, independently and spontaneously turns out to be the same phrase their clients – all of them – had in mind all along.)

(link to opinion)