Burger v. Allied Property & Casualty Insurance
2016 U.S. App. LEXIS 8906
8th Cir.2016Background
- In Dec. 2012 Lisa Burger was injured by a negligent driver whose insurer paid its $100,000 policy limit; Burger sought underinsured motorist (UIM) benefits from her insurer, Allied.
- Allied denied the UIM claim because its policy defined an "underinsured motor vehicle" as one whose bodily-injury liability limit is less than the UIM limit shown in Allied's Declarations ($50,000 per person).
- Burger sued Allied (state court) for vexatious refusal to pay; Allied removed to federal court and moved for summary judgment, which the district court granted. Burger appealed.
- The central legal question: whether Allied's UIM endorsement is ambiguous such that Allied must pay despite the tortfeasor having a $100,000 policy.
- Allied relied on the policy text and Missouri Supreme Court precedent holding identical language unambiguous; Burger argued other policy provisions (declarations page, other-insurance clause, limit language, reasonable-expectations doctrine) created ambiguity.
- The Eighth Circuit reviewed de novo, concluded the UIM definition is unambiguous, and affirmed summary judgment for Allied.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Allied's UIM endorsement is ambiguous | Burger: other policy provisions (declarations, other-insurance clause, limit language) create ambiguity about when UIM applies | Allied: UIM definition plainly requires tortfeasor's liability limit be less than Allied's $50,000 UIM limit; other provisions do not conflict | Held: Policy unambiguous; Allied owed no UIM because tortfeasor's $100,000 limit exceeds $50,000 UIM limit |
| Effect of declarations page not stating limitations | Burger: absence of explanatory limitations on declarations page creates ambiguity | Allied: declarations page is a summary; body of policy defines limits; no definitions force inclusion of limitations on declarations page | Held: Declarations do not create ambiguity; body controls |
| "Other insurance" clause conflict | Burger: clause could imply UIM is excess over tortfeasor contribution, creating tension with definition of UIM | Allied: Clause only addresses other collectible UIM insurance (limited scope), not tortfeasor liability; no conflict with UIM definition | Held: Clause does not contradict UIM definition; no ambiguity |
| Amount of coverage (limit-of-liability language) | Burger: policy promises $50,000 then limits recovery to difference, making coverage illusory/ambiguous | Allied: tortfeasor payments are credited against damages, not against Allied's limit; coverage amount disputes don't alter what qualifies as an underinsured vehicle | Held: Even any internal tension about payout amount is irrelevant to whether an underinsured vehicle exists; UIM definition remains clear |
Key Cases Cited
- Rodriguez v. General Accident Ins. Co. of Am., 808 S.W.2d 379 (Mo. 1991) (Missouri Supreme Court holding identical UIM definition clear and tortfeasor with equal limit not underinsured)
- Owners Ins. Co. v. Hughes, 712 F.3d 392 (8th Cir. 2013) (applying Rodriguez to find similar UIM language unambiguous)
- Seeck v. Geico Gen. Ins. Co., 212 S.W.3d 129 (Mo. 2007) (discussing ambiguity tests and how other-insurance clauses can create tension)
- Jones v. Mid–Century Ins. Co., 287 S.W.3d 687 (Mo. 2009) (noting that contract promises followed by contradictory limitations can create ambiguity)