56 N.E.3d 1209
Ind. Ct. App.2016Background
- On Jan. 8, 2009, Matthew Ackerman was severely injured in a motor-vehicle crash while employed by Evansville Marine; he recovered policy limits from the tortfeasor and CNA (Evansville Marine’s primary/umbrella carrier) but sought additional UIM coverage.
- Evansville Marine had (1) UM/UIM coverage with CNA, (2) an excess/umbrella policy with Fireman’s Fund, and (3) workers’ compensation benefits through AER (which intervened).
- Fireman’s Fund issued excess liability policies beginning in 2004 and renewed each Sept. 16; the relevant policy was effective Sept. 16, 2008–Sept. 16, 2009 and expressly did not state UIM coverage.
- Ackerman sued for UM/UIM benefits under the Fireman’s Fund policy; Fireman’s Fund moved for summary judgment arguing the policy was not required to provide UM/UIM coverage.
- The trial court denied summary judgment and certified an interlocutory appeal; the Court of Appeals reviewed whether Indiana law required Fireman’s Fund to provide UM/UIM coverage on this commercial excess/umbrella policy.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Fireman’s Fund’s 2008 excess/umbrella policy had to provide UM/UIM coverage | Ackerman: 2005 amendment (I.C. §27-7-5-1.5) only applies to newly issued policies; absent application, DePrizio requires UM/UIM unless insurer obtained written rejection | Fireman’s Fund: §27-7-5-1.5 excludes commercial umbrella/excess policies from the UM/UIM mandate upon issuance (including renewals) so no coverage required | Court: §27-7-5-1.5 applies to issuance generally (includes renewals); insurer not required to provide UM/UIM in commercial umbrella/excess policy; summary judgment for Fireman’s Fund reversed trial court and remanded with directions to enter judgment for insurer |
| Whether insurer still needed a written rejection to avoid UM/UIM on the 2008 policy | Ackerman: even if §27-7-5-1.5 applies, insurer must obtain written rejection under §27-7-5-2(b) to avoid UM/UIM | Fireman’s Fund: if statute removes the obligation to make coverage available, no written rejection is necessary | Held: Court rejects Ackerman—statute relieved insurer of any duty to provide or offer UM/UIM for such commercial policies, so written rejection was not required |
| Whether statutory change required separate consideration or a premium adjustment to remove UM/UIM at renewal | Ackerman: removing UM/UIM is a material policy change that would require consideration (citing Beatty) | Fireman’s Fund: Beatty is distinguishable (mid-term change/ambiguous waiver); here removal resulted from clear statutory change at issuance/renewal | Held: Court finds Beatty inapplicable; no authority requiring consideration when coverage no longer required by statute at issuance/renewal |
Key Cases Cited
- DePrizio v. United Nat. Ins. Co., 705 N.E.2d 455 (Ind. 1999) (held commercial umbrella/excess policies that cover vehicular liability are subject to UM/UIM mandate)
- Justice v. Am. Family Mut. Ins. Co., 4 N.E.3d 1171 (Ind. 2014) (rules for insurance contract interpretation; statutory interpretation de novo)
- Pfenning v. Lineman, 947 N.E.2d 392 (Ind. 2011) (summary judgment standard and appellate review)
- Liberty Mut. Fire Ins. Co. v. Beatty, 870 N.E.2d 546 (Ind. Ct. App. 2007) (discussed when insurer must obtain clear waiver or provide consideration to alter UM/UIM coverage mid-term)