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Indiana Court of Appeals Holds Uninsured Motorist Coverage Inapplicable to Injury to Insured as a Passenger in his Own Vehicle - Insurance Coverage

Insurance Coverage


Posted on: Oct 24, 2018

By Jonathan B. Noyes, Wilson Kehoe Winingham

Recently, the Indiana Court of Appeals held that uninsured motorist coverage was inapplicable where an insured-passenger was injured in his own vehicle by a tortfeasor operating the insured’s vehicle. In Progressive Southeastern Insurance Co. v. Smith, Nolan Clayton drove himself and Gregory Smith from a work event in Mr. Smith’s vehicle. Mr. Smith was injured after Mr. Clayton lost control of the vehicle and ran into a tree. Mr. Smith sued Mr. Clayton, who was insured by Allstate and settled with him out of court. Afterward, Mr. Smith’s insurer, Progressive, filed a declaratory action seeking confirmation that it was not required to pay Mr. Smith uninsured motorist coverage benefits. Mr. Smith filed for summary judgment, which was granted by the trial court, and Progressive appealed.

On appeal, Progressive argued that Mr. Smith’s vehicle could not be considered “uninsured” under his policy or the uninsured motorist coverage statute, Ind. Code § 27-7-5-1, because of a policy exclusion and the fact that Mr. Clayton’s liability insurer covered him for his negligence. The court of appeals agreed. Mr. Smith’s policy excluded an owned vehicle from its definition of “uninsured motor vehicle” and Mr. Clayton was insured through his own policy even if the vehicle he was operating was not.

This holding is in accordance with other Indiana cases concluding that a tortfeasor’s individual liability policy negates uninsured motorist coverage even when the vehicle operated by the tortfeasor is not separately insured (or vice versa). See Matteson v. Citizens Ins. Co. of Am., 844 N.E.2d 188 (Ind. Ct. App. 2006); State Farm Auto. Ins. Co. v. Leybman, 777 N.E.2d 763 (Ind. Ct. App. 2002).

You can see the full Progressive opinion here.

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