453 F. Supp. 883 | W.D. Va. | 1978
MEMORANDUM OPINION AND ORDER
Seeking a declaratory judgment that it is not liable under an automobile liability policy, Dairyland Insurance Company, a Wisconsin corporation, having its principal place of business in that state, brought this action naming as defendants, Mike Collier, a resident of the State of Virginia, who is claiming liability coverage pursuant to a policy of insurance issued in this state, and Howard S. Claytor, the plaintiff in a tort action in the Circuit Court of Pulaski County, in which Mr. Collier is the defendant. Jurisdiction is predicated upon diversity of citizenship and more than $10,000.00 in controversy, exclusive of interest and costs. Title 28 U.S.C. § 1332. The facts have been stipulated, and the parties are in agreement that the issues presented are whether an automobile liability policy issued for a period of less than six months is automatically converted into a policy for a term of six months and whether “notice of cancellation” was required “prior to automatic termination of the policy” in question.
On October 20, 1975, Michael Collier applied with the Dairyland Insurance Company for liability insurance to cover a 1956 Chevrolet truck from October 24, 1975, to November 24 of that year.
Mr. Collier contends that pursuant to Va.Code Ann. § 38.1-381.5(a)(2), which is applicable to automobile liability policies issued in this state, any policy covering a period of less than six months is converted by operation of law into a policy for six months. That section provides, in relevant part,
that any policy with a policy period or term of less than twelve months or any policy with no fixed expiration date shall for the purpose of this section be considered as if written for successive policy periods or terms of six months from the original effective date.
But for Va.Code Ann. § 381.5(f)(1) defendants’ arguments would have merit. That section, however, creates a clear exception to the provisions of subparagraph (a)(2):
(f) Nothing in this section shall apply:
(1) If the insurer or its agent acting on behalf of the insurer has manifested its willingness to renew by issuing or offering to issue a renewal policy, certificate or other evidence of renewal, or has manifested such intention in writing to the insured, such written manifestation shall include the name of a proposed insurer, the expiration date of the policy, the type of insurance coverage, and information regarding the estimated renewal premium.
As plaintiff unequivocally manifested in writing its willingness to issue a renewal policy which written manifestation included the insurer’s name, the expiration date of the policy, the type of insurance coverage, and information regarding the estimated renewal premium, its actions fell squarely within the language of that section. Consequently, other provisions of the statute are inapplicable. See Peerless Insurance Co. v. Associates Financial Services of America, Inc., Va., 241 S.E.2d 792 (1978).
Defendant states that he “relies upon Section 46.1-513.1 of the Code of Virginia” which requires notice to the Commissioner of the Division of Motor Vehicles within fifteen days of the cancellation of an automobile liability policy if the cancellation occurs within six months of its issuance. As that section was not approved by the Virginia General Assembly until March 28,1976, and nonrenewal of the policy occurred prior to that date, it is clearly inapplicable. Its predecessor, Va.Code Ann. § 38.1-70.13, repealed 1976 Va.Acts, Ch. 259, required an insurer or his agent to report to the Commissioner of the Division of Motor Vehicles within fifteen days any cancellation or termination of an automobile liability policy. Assuming that the lapsing of an insurance policy for nonpayment of premium fell within the provisions of § 38.1-70.13 there was neither an express provision nor a discernible legislative intention to make ineffectual a termination where notice was not given the Commissioner. It is, therefore, both logical and reasonable to assume that violations of the section were redressable by the State Corporation Commission in its regulatory capacity and not through extension of coverage.
It is also contended that plaintiff failed to comply with the requirements of Va.Code Ann. §§ 38.1-380.2 and 38.1-382.1. The former requires the insurer to include in every original and renewal premium notice information concerning the purchase of additional, optional insurance coverage containing certain hospital, medical, and disability benefits for the insured and relatives who are members of his household. The latter statute requires the automobile liability insurer to include in every premium invoice information concerning the availability of additional uninsured motorist coverage. While the plaintiff was in conformity with neither of these statutes, as with its nonconformity with § 38.1-70.13, the violation is redressable by the State Corporation Commission in its regulatory capacity and not through extension of coverage, at least
It is last contended by Mr. Collier that plaintiff failed to comply with Va.Code Ann. § 38.1 — 381.7 which requires the insurer to “provide the named insured at the time of issuance or renewal with a statement defining the rate classification of the insured.” This argument is undoubtedly without merit as the statute in question was not enacted until 1977.
In accordance with the court’s opinion, judgment is entered for Dairyland Insurance Company, declaring that Michael Collier had no insurance with Dairyland covering the automobile accident in which he was involved on February 16, 1976.
. The coverage periods, terms, and conditions of the Dairyland policies, renewal notices, and rewrite notices were approved by the Commissioner of Insurance of the Commonwealth of Virginia.