United Services Automobile Association v. Neary
2013 Alas. LEXIS 102
| Alaska | 2013Background
- Fifteen-year-old Kevin Michaud fired a revolver and killed one boy and gravely wounded another; emotional distress claims were asserted by the victims’ parents.
- The Michauds’ homeowners liability policy with USAA provided a $300,000 per- occurrence limit for Personal Liability.
- Policy language defines occurrence as an accident resulting in bodily injury or property damage, with the limit stated as a single amount per occurrence.
- The Declarations page shows $300,000 per occurrence; the policy’s “Limit of Liability” provision specifies the total liability for any one occurrence does not vary with the number of insureds, claims, or injuries, and “Severability of Insurance” applies separately to each insured but does not increase the limit.
- The superior court held three separate $300,000 limits (total $900,000) due to multiple insureds, and that there was one occurrence; USAA appeals the per- occurrence limit as not duplicating per insured, while the parents cross- appeal on multiple occurrences; the Alaska Supreme Court reverses and holds a single per-occurrence limit applies to a single occurrence.
- The Court remands for proceedings consistent with its opinion.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether policy provides a single per-occurrence limit regardless of insured count | USAA—one per-occurrence limit governs all insureds | Neary/Schneider—limits may multiply per insured or per occurrence | Single per-occurrence limit of $300,000 applies. |
| Whether there was a single or multiple occurrences | Multiple occurrences due to six injuries or negligent acts | Single accident; one occurrence | One occurrence, the shooting incident. |
| Effect of severability and extrinsic evidence on coverage limits | Severability could create per insured limits; extrinsic evidence supports separate coverage | Severability does not increase limits; no support from extrinsic evidence | Severability does not increase policy limits; language controls. |
Key Cases Cited
- Folkman v. Quamme, 655 N.W.2d 857 (Wis. 2003) (rejected per-insured escalation of an ‘each occurrence’ limit in auto policy context)
- Koikos v. Travelers Ins. Co., 849 So.2d 263 (Fla. 2003) (proper measure of occurrences is gunshots, not number of injuries; single accident rule)
- Makarka ex rel. Makarka v. Great American Ins. Co., 14 P.3d 964 (Alaska 2000) (occurrence-based policy triggered by injury during policy period)
- Remmer v. Glens Falls Indem. Co., 295 P.2d 19 (Cal. App. 1956) (accident timing to measure occurrence)
- INA Life Ins. Co. v. Brundin, 533 P.2d 236 (Alaska 1975) (definition of accident/occurrence and reliance on Restatement concept)
- Allstate Ins. Co. v. Teel, 100 P.3d 2 (Alaska 2004) (policy language clarifies limits; ambiguity avoided in favor of insured)
- Dowdy v. State Farm Mut. Auto. Ins. Co., 192 P.3d 994 (Alaska 2008) (summary judgment/interpretation of policy language relevant)