This case involves an interpretation of the underinsured motorist coverage statute, Ark. Code Ann. § 23-89-209(a) (Supp. 1997). Appellant Deborah Majors was involved in an accident with an underinsured vehicle. At the time of the accident, Ms. Majors was insured by American Premier Insurance Company. Ms. Majors filed suit against American Premier alleging that she was entitled to underinsured motorist (UIM) coverage in the amount of $25,000.00. The trial court granted summary judgment in favor of American Premier on the basis that it had obtained a written rejection of UIM coverage from the named insureds at the time the policy was originally issued, and Ark. Code Ann § 23-89-209(a) did not require American Premier to obtain an additional written rejection when the policy was amended. We affirm.
The relevant facts in the instant case are not in dispute. On August 11, 1995, the appellant’s parents, Stewart and Virginia Foster, entered into a contract for automobile insurance with American Premier. The contract covered both Mr. and Mrs. Foster and their automobiles. The Fosters were informed of the availability of UIM coverage at the time the policy was issued. They rejected UIM coverage and executed a written waiver. In July of 1996, Mrs. Foster contacted her local insurance agent about adding her daughter, Deborah Majors, to the policy. Ms. Majors was twenty-four years old, did not five with her parents, and planned to pay for her own coverage. Mrs. Foster filled out and signed a “Change Request” form, adding Deborah Majors as an “additional operator” and her vehicle, a Nissan Stanza, to the policy. The words “same coverages” were written across the section listing the various coverage options, including UIM coverage. American Premier did not offer UIM coverage, and Mrs. Foster did not withdraw her previous rejection of that coverage. Nor did Ms. Majors request any change in the coverage extended to her.
On July 27, 1996, Deborah Majors was involved in an automobile accident with a drunk driver. As a result of that accident, Ms. Majors incurred medical expenses in the amount of $90,000.00. Ms. Majors was offered the policy limits of $50,000.00 by the other driver’s insurance company. After receiving permission from American Premier, Ms. Majors settled with the other insurance company for the policy limits. She then made demand on American Premier for $25,000.00, claiming that underinsured motorist coverage existed as a matter of law because American Premier did not offer UIM coverage to her when she was added to her parents’ policy. American Premier refused her demand, and on December 5, 1996, Ms. Majors filed suit against American Premier. American Premier answered and then filed a motion for summary judgment. Ms. Majors appeals the trial court’s order granting American Premier’s motion for summary judgment.
As we have said on numerous occasions, summary judgment is to be granted by a trial court only when there are no genuine issues of material fact to be litigated, and the moving party is entitled to judgment as a matter of law. Nelson v. River Valley Bank & Trust,
Mr. and Mrs. Foster rejected UIM coverage when they obtained the initial policy from American Premier in August of 1995. On July 2, 1996, that policy was changed to include Deborah Majors, their daughter, and her Nissan Stanza automobile. Ms. Majors was injured on July 27, 1996. During all relevant periods, Ark. Code Ann. § 23-89-209(a) (Supp. 1997), uninsured motorist coverage, provided in pertinent part:
(a)(1) No private passenger automobile liability insurance covering liability arising out of the ownership, maintenance or use of any motor vehicles in this state shall be delivered or issued in this state or issued as to any private passenger automobile principally garaged in this state unless the insured has the opportunity, which he may reject in writing, to purchase underinsured motorist coverage.
(2) After a named insured or applicant for insurance rejects underinsured motorist coverage, the insurer or any of its affiliates shall not be required to notify any insured in any renewal, reinstatement, substitute, amended, or replacement policy as to the availability of such coverage.
(Emphasis added.) We have recognized that this statute requires insurers to provide underinsured motorist coverage to the named insured unless such coverage is rejected in writing by the insured. Shelter Mutual Ins. Co. v. Irvin,
When construing a statute, we adhere to the basic rule of statutory construction, which is to give effect to the intent of the legislature. Ford Motor Credit Co. v. Ellison,
It is evident from the plain language of section 23-89-209(a) that an insurance company does not have to offer UIM coverage each time that an existing policy is changed, so long as UIM coverage has previously been rejected by a named insured or applicant for insurance. Section 23-89-209(a)(2) specifically provides that once a named insured or applicant for insurance rejects UIM coverage, the insurer is not required to notify any insured about such coverage in any “renewal, reinstatement, substitute, amended, or replacement policy.” The broad wording of this provision clearly indicates the legislature’s intent to make a rejection of UIM coverage by one named insured effective as to any subsequent incarnation of the original policy that comes within the comprehensive categories listed in section (a)(2). This provision also indicates that a rejection of UIM coverage by a named insured is effective thereafter as to any person insured under that policy.
In Colonia Underwriters Insurance Co. v. Richardson,
Ms. Majors contends that the holding in Colonia is limited to its facts, i.e., the addition of vehicles to an existing policy. Although Colonia did not specifically address the addition of a named insured, our interpretation of the UIM statute is governed by its clear language that any amendment to an existing policy of insurance does not require a second rejection. Ms. Majors also argues that this case can be distinguished from Colonia because she is an adult paying for her own insurance and living apart from her parents. She asserts that the addition of her name to her parents’ existing policy constituted a new policy of insurance. We do not agree.
The undisputed facts reflect that Ms. Majors was added to her parents’ insurance policy as an “additional operator.” American Premier’s obligation to insure her arose out of her mother’s written request that Ms. Majors and her vehicle be added to an existing policy. As noted by the trial court, it is apparent that Ms. Majors sought to be added to her parents’ existing policy in order to obtain the benefit of a cheaper insurance rate. Clearly, Ms. Majors never intended to take out a separate insurance policy. Thus, we hold that adding Ms. Majors to her parents’ existing insurance policy constituted an amendment to that policy and a second or subsequent rejection of UIM coverage was not required under Ark. Code Ann. § 23-89-209(a).
Ms. Majors finally contends that the trial court’s interpretation of the UIM coverage statute violates public policy. It has previously been pointed out, however, that a state’s public policy is best evidenced by its statutes. Guaranty National Ins. v. Denver Roller, Inc.,
Affirmed.
Notes
Our decisions in Lucky v. Equity Mutual Insurance Co.,