*1 CITY OF GARY and Gary Department, (Third
Police Appellants,
-Party Below), Defendants Deluna, Jr.,
Luis Appellant,
(Plaintiff Below),
ALLSTATE COMPANY, INSURANCE (Defendant
Appellee. and Third- Below). Party Plaintiff
No. 04S03-9304-CV-439.
Supreme Court of Indiana.
April 15, 1993. Ruff, Nathaniel Ruff, Lesniak and East
Chicago, appellant Deluna, Luis Jr. Brown, Robert D. Spangler Jennings & Dougherty, Merrillville, for appellee, All- state Ins. Co.
ON PETITION TO TRANSFER KRAHULIK, Justice.
We transfer to decide whether a self-insured municipality is under an obli- gation uninsured motorist cover- age for its automobiles. Allstate Insur- (Defendant ance Company and Third-Party below) Plaintiff ("Allstate") seeks transfer after the Court of Appeals reversed the summary judgment granted in favor of All- state Gary and the City of Gary Police Department (Third- Party below) Defendants ("City") and Luis Deluna, (Plaintiff below) Jr. ("Deluna"). *2 in this garaged principally or registered (1992), Ins. Allstate Gary v. City of resulting state, insuring 625. N.E.2d Ind.App., 598 bodily for imposed liability from person by any Facts suffered or death injury prop- of or destruction injury to for police officer duty as a Deluna, on while owner- arising from the City-owned erty to others operating City, was for the motor of a maintenance, use acci- or in an ship, involved he was car when police in either coverage, vehicle, provide must sued Deluna Reed. Hanford with dent it: supplement in a that he sus- or injuries policy personal for the Reed accident. in the tained or death bodily injury (1) In limits of destruction injury to or accident, had and for Deluna the time At automobile in IC 9-2-1-15 personal forth [now in effect set property unin- provided which policy provisions Allstate with policy under IC 9-25-2-8] learning Upon coverage. insur- motorist of sured by the commissioner approved insol- was carrier Reed's in- persons of ance, protection for the complaint amended vent, filed an Deluna enti- legally are who thereunder sured In defendant. as a Allstate added which from owners damages to recover tled complaint third-party turn, filed Allstate vehi- motor of operators or City, as alleging that against the bodily injury, sickness of because cles car, primarily was police of self-insurer death, and for including disease, or coverage for motorist for uninsured liable property destruction or injury to argument this advanced Allstate Deluna. therefrom; or resulting The judgment. summary motion for in its injury or death bodily (2) In limits Allstate's granted agreed and trial court 9-25- IC in IC 9-2-1-15 forth [now set motion. approved provisions policy under 2-3] grant of court's reversing the trial In insurance, for commissioner by the Appeals the Court summary judgment, un- insured persons that, although self-insurers determined legal- are who provisions policy der the unin provide required are general rule from damages recover ly entitled to Ind. pursuant coverage motorist sured mo- of uninsured operators or owners demon 27-7-5-2, Code § injury, bodily because tor vehicles governmental to create intent strated re- disease, including death or sickness it enact case when type of immunity in this sulting therefrom. Act Act,1 this Tort Claims ed the motorist The uninsured from for the exemption created higher limits in by insurers offered asserts Allstate coverage. such providing in IC 9-2-1-15 forth set those than self-insured transfer petition its may not be 9-25-2-3], IC [now providing exempt from is municipality spec- liability limits than the greater coverage.2 motorist the uninsured property injury and bodily in the ified in- liability damage Discussion policy. sured's in effect statute The 1985). (West stated: accident Deluna's Ann. time § Ind.Code at the right has the insured, The named ve- or motor liability Each automobile coverage from the exclude is of insurance liability hicle awith the insurer by providing delivery in this issued delivered 27-7-5-2(b). rejection. § vehicle any motor written respect to state with municipality under a a self-insured 34-4-16.5- 34-4-16.5-1 Ann. cover- provide uninsured obligation to (West do not dispositive, we employees is age its transfer, asserted also Allstate petition to its In estoppel issue. collateral address estopped collaterally from City was of whether the issue coverage. Because denying Allstate asserts that a municipality that america Ins. Co. v. Henry Ind., 563 self-insures its vehicles must also 1268. Although Indiana the statutorily-mandated uninsured motor- be referred to as a compulsory financial coverage. ist support To assertion, its All- responsibility state, a victim is guaran argues state that Indiana is a compulsory compensation teed in every automobile acci *3 financial responsibility state which requires dent. person Id. A complies with the fi insurers and self-insurers to make unin- nancial responsibility by law providing sured motorist coverage available. Addi- proof person that the respond able to in tionally, argues Allstate damages for liability through caused the 34-4-16.5-8 of the Tort Claims Act does ownership of the motor vehicle in the statu not create exemption municipali- the tory amount. Ind. Code 9-25-2-8.5 The ty from providing the uninsured motorist permits proof of financial responsibility coverage and purpose that the of the unin- through purchase the of motor vehicle lia sured motorist statute is by defeated creat- bility insurance, through bond, deposit of ing the exemption. funds securities, or or self-insurance. Ind. In response, Deluna asserts that a mu 9-25-4-7, Code 9-25-4-11.6 §§ nicipality's status as a3 purposes of the financial responsibility hand, On the other purpose the law does not also obligate municipali the uninsured motorist coverage put is to the ty the uninsured motorist cover injured party place in the they would have age of the uninsured motorists coverage been if the person other had complied with law. Additionally, Deluna contends that the financial responsibility law. See Town the statute requiring uninsured motorist and Country Mutual Ins. Co. v. Hunter coverage applies only to insurers because a (1985), Ind.App., 472 1270. self-insurer does not have policy a of insur The uninsured motorist statute in effect ance. at the time of the accident referred to a "policy
The purpose insurance" and Indiana's stated that financial the responsibility law is "insurer" compel offer coverage in motorists to an amount make in for the excess of the statutory of other minimum.7 The statute, drivers on the did not specifically ad road so driver protected from damages which might be dress whether a self-insurer comes within inflicted on him by another. Trons- the confines of the statute. Consequently, Although 3. the has not been certified as a following did add prefatory the language to the self-insurer under the responsibility financial available, section: "The insurer shall make law, we hold City's the actions meet the liability each automobile or motor vehicle liabil- requirements technical of the statute and are ity policy of insurance...." An "insurer" for qualify sufficient the as a self-insurer for purposes of the Code is company, defined as "a purposes of that law. firm, association, partnership, order, or society system making any kind or kinds of 4. The insurance Indiana, responsibility financial law of and shall include operating associations § 9-1-4-3.5 and §§ 9-2-1-1 to 9-2- Lloyds, interinsurers, reciprocal or or individu- 1.5-13, has been and repealed recodified at Ind. Code (West Ann. §§ 9-25-1~-1 to al underwriters." 9-25-8-4 Ind.Code § 27-1-2-3. This Although verbatim, the recodification was not definition does not include a self-insurer and changes the were not substantive and do not can not be encompass construed to one. Addi- affect our purposes decision. For clarity, tionally, change in the statute is evidence however, we will refer to sections of the finan- did not intend to include responsibility cial they law as are now codified self-insurers in the obligation pro- with a footnote previous reference to the code vide coverage. But, rather, section. legislative evidences the intent to limit the re- quirement providing uninsured motorist cov- Formerly Ind.Code § 9-2-1-15. erage offering to those "policy of insurance." Formerly 9-2-1-16, Ind.Code §§ 9-21-37. Consequently, our decision would remain the same under the statute in effect at the time of 7. We note that Ind.Code § 27-7-5-2 was amend- the accident or now. ed January effective 1988. The amendment change did section, the substance Moun coverage. See distinguishing analysis begin our Casual Aetna Tel. v. and Tel. States tain self-insurance. and insurance between P.2d App., 568 (1977), Ariz. Sur. ty and is: insurance First, issue does (self-insured 1123, 1125 agreement or a contract exists contract no of insurance consideration, party, one by which self-insurer); insured between equivalent or its money pay promises (1975), 85 Army v. Salvation O'Sullivan insured act valuable do an toor (self- 729, 788 Cal.Rptr. 58, 147 App.3d Cal. injury of destruction, or upon contractual not involve does has a party the other something in which company); obligations interest, in consideration pecuniary Dist. Transp. Regional White risk, be- adequate paid, price (self-insurers 218, 219 P.2d Col.App., *4 loss against the other security to comes motor uninsured obtain to required not are in- risks; to specified certain by provision a coverage without ist a for loss against security demnity or and Power Florida it); Lipof v. requiring consideration. 1067, So.2d App., 558 (1990),Fla. Light Co. Generally, insur- 27-1-2-3(a). "insurer" § is not (self-ingurer 1068 through indemnity of a contract insurance ance is Florida the under purposes most obligation party (1986), undertakes IIl. Corp. a which Hertz v. code); Robinson arising loss 111, another compensate 687, Ill.Dec. 95 App.8d Ill. 140 App., per- contingencies specified from certain (self-ingsurer does 332, 334 113, 489 N.E.2d one from risk of the liabili their It shifts limit ils. and policy a not offer Building and Meyer v. Casualty v. to another. party Mut. and Grange ty); Refin 185, 125, Ind. (1985), 209 47, Co. 487 Realty Serv. St.3d 21 Ohio (1986), Transp. ers and Title 258-54; 250, Southeast motorist (the uninsured 310, 196 N.E. 314 N.E.2d Fla.App., 226 self-insurers encompass (1969), not do v. Collins Co. Ins. from Rhodes, Couch must come change in the 248; 247, 1 Mark S. any and So.2d (rev. ed. Ins. Co. 1:2-1:3 States 2d American Insurance legislature); §§ on the Utah, P.2d 699 (1985), Transit v. Utah however, is not Self-insurance, not is (self-insurance 1210, 1212 in of rather, "antithesis the but, is all at judgments that assurance rather but Intergovern Indiana v. Eakin surance." Re-Ins. American v. paid); Shelton be (1990), will Auth. Management Risk mental 820, 828 655, 173 S.E.2d (1970),210 Va. 1098, 1095, (quoting 557 Ind.App., of "policy'" a have not does (self-insurer Passaic Gen. Ass'n. Nurses American insurance). N.J.Super. Ct.App.Div., Hosp. . 69) Nurs In American 471A.2d recognized, Appeals of Court the As es explained, that holds Ass'n., "[tlhe court cases the line of however, es another colloquial self-insurance, of a term a self- and that of is immaterial sence the distinction mean legal precise uninsured provide than currency required rather is insurer by a of loss provided the risk they if had coverage retention ing, the is motorist not, imposed directly do is cases it These upon whom insurance. the one language As a at 69. precise A.2d the however, interpret or contract." by law enacting the not does our used self-insure result, the choice "insurance," believe We statute. has party motorist the mean that further We to retain here. applicable chosen has party they the are that rather cases, distin- above-cited the risk. the believe so-called "insurers" guishing between have which jurisdictions In other reasoned. "self-insurers," better are obligation self-insurer's considered pur- self-insured choosing to be coverage, In provide law, responsibility financial line poses One developed. authority has split judgments pay cages itself obligated City between distinction on a relying as- exchange for In against it. rendered holds self-insurance judgments, paying suming the risk required provide is self-insurer expense has saved the purchasing torist financial responsibility. Financial re- policy of insurance would cover this sponsibility must be maintained in the mean, risk. This does not $25,000 amount of by means of an insur- "policy has issued a of insurance" policy, however, ance bond, deposit or that it has become an "insurer" for money, or a certificate of self-insurance anything beyond meeting requirements may also be sufficient. 9-25- § of the responsibility financial act. 4-7; 1.0. 9-25-4-11. The intent § Although recognize we pur- the remedial legislature is evident. Each such means pose of the uninsured equivalent carries an protective value. The statute and agree even public bond, deposit, and the certificate of requirement favors a that self-insur- sufficient, self-insurance are seen as equiv- ers under the financial responsibility law alent substitutes Indeed, for the policy. required some should sort of expressly, a bond equal must be policy. to a uninsured motorist those 1.C. 9-25-4-9. 1.0. 27-7-5-2 added the automobiles, who drive their it is not our requirement policies that insurance initially role to judicial legislator sit as a and write provide uninsured motorist coverage. This such a requirement Rather, into the act. part became of financial responsibility, not type of mandate must come from the only where an insurance policy used, but, legislature. The uninsured motorist cover- through the intent to equivalent authorize *5 age applies only act to "insurers" who is- means, where, here, self-insurance or a sue or deliver a "liability policy of insur- certificate self-insurance, is used. ance." It apply does not to those who therefore, would hold as did the trial decide to retain and, the risk of loss there- court, and the fore, purchase Appeals, do not Court of of insurance. that self- insurers such as Gary must Consequently, under present statuto- provide uninsured motorist coverage as re- ry scheme City, as a self-insured munic- quired by 1.0. 27-7-5-2. Since the ma- ipality, is not brought under the require- jority does not reach the exemption ques- ments of providing the uninsured motorist tion considered in the Appeals, Court of I coverage of Ind.Code 27-17-52 simply find no reason to do so. because it has chosen to be a self-insurer under the financial responsibility provi- sions. result, As a DICKSON, J., responsi- is not concurs.
ble to provide uninsured to Deluna.
Conclusion Accordingly, grant transfer, vacate opinion Appeals, Court of re- verse the trial court's entry summary HASTY, Leslie Appellant-Plaintiff, R. judgment, and remand this matter to the trial court. HOSPITAL, FLOYD MEMORIAL SHEPARD, C.J., GIVAN, J., concur. Appellee-Defendant. DeBRULER, J., dissents, separate with No. 22A01-9207-CV-219.
opinion in DICKSON, J., concurs. Court of Appeals Indiana, DICKSON, J., would transfer, but First District. dissents as to opinion and concurs with DeBRULER, J.'s dissent. Nov. Publication Ordered March
ON PETITION TO TRANSFER DeBRULER, Justice, dissenting.
The insurance policy far the domi-
nant means in society our of providing mo-