Gilkey v. Grange Mut. Cas. Co.
2016 Ohio 7676
| Ohio Ct. App. | 2016Background
- Pedestrian Shane Gilkey was killed in a car accident; his spouse Malissa settled tort claims against the tortfeasor for the tortfeasor’s $25,000 liability limit.
- Shane Gilkey had a Grange Mutual personal auto policy with UM/UIM limits of $500,000; Malissa recovered $475,000 under that policy (policy limit less tortfeasor payment).
- The Gilkeys also had a Grange Mutual farm umbrella policy (limit $1,000,000) issued after an application that did not request UM/UIM; no premium was charged for UM/UIM on the umbrella and no UM/UIM endorsement was issued.
- The umbrella declarations listed underlying policies (including the auto policy) as required maintained coverage but did not state that underlying coverages were incorporated into the umbrella.
- The umbrella policy expressly excluded bodily injury to “you” or any “insured” (the Gilkeys), and Grange’s underwriting affidavit stated UM/UIM was not requested or issued for the umbrella.
- Trial court granted summary judgment for Grange; the appellate court affirmed, holding the umbrella did not provide additional UM/UIM coverage and UM/UIM could not arise by operation of law due to statutory amendment.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the farm umbrella policy provided additional UM/UIM coverage by incorporating underlying auto policy coverage | Declarations incorporate underlying coverages (including the auto policy’s UM/UIM), so the umbrella supplies $1,000,000 UM/UIM | An umbrella is excess/horizontal coverage; declarations only require maintaining underlying policies and do not incorporate their coverages; umbrella excludes bodily injury to insureds | Court held no UM/UIM under the umbrella; declarations do not incorporate underlying coverages and the umbrella’s insured-bodily-injury exclusion precludes UM/UIM |
| Whether UM/UIM could arise by operation of law under the umbrella | (Implied) UM/UIM might be read into the umbrella absent explicit exclusion | 2001 amendment to R.C. 3937.18 removed mandatory offer/operation-of-law creation of UM/UIM; no policy provision created UM/UIM | Court held UM/UIM cannot arise by operation of law; statutory change eliminated that possibility |
Key Cases Cited
- Granger v. Auto-Owners Ins., 40 N.E.3d 1110 (Ohio 2015) (defines umbrella as providing excess and "drop down" coverage and explains vertical vs. horizontal coverage)
- Cincinnati Ins. Co. v. CPS Holdings, Inc., 875 N.E.2d 31 (Ohio 2007) (umbrella policies contrasted with primary/excess policies)
- Holliman v. Allstate Ins. Co., 715 N.E.2d 532 (Ohio 1999) (umbrella need not mirror underlying policy coverage)
- Laboy v. Grange Indem. Ins. Co., 41 N.E.3d 1224 (Ohio 2015) (contract interpretation principles for insurance policies)
- Westfield Ins. Co. v. Hunter, 948 N.E.2d 931 (Ohio 2011) (de novo review for insurance contract summary judgment)
- State Farm Mut. Auto. Ins. Co. v. Grace, 918 N.E.2d 135 (Ohio 2009) (statutory change eliminated operation-of-law creation of UM/UIM coverage)