S.C. FARM BUREAU v. U.S. FIDELITY & GUARANTY
12/28/1995
This is a declaratory judgment action in which two insurance carriers seek to determine which company has the primary responsibility for payment of underinsured motorist coverage to Ronald Canty. The trial court held Farm Bureau was primarily responsible for the coverage. Farm Bureau appeals. We reverse.
The facts are not in dispute. Ronald Canty is the caretaker of Scottswood Plantation, a hunting and fishing retreat in Williamsburg County. On Christmas Day, 1989, Canty was injured in a car wreck while driving a vehicle owned by Scottswood Plantation. Although he was working at the time, Canty did not file for workers' compensation benefits. He initiated a personal injury action against the driver of the other vehicle and noticed underinsurance claims with Farm Bureau and USF&G. Farm Bureau provided underinsured motorist coverage to Canty under a personal automobile policy issued in his name. USF&G provided underinsured motorist coverage under a commercial policy issued to Scottswood Plantation, Canty's employer. The other driver's liability carrier paid
After a review of the applicable insurance policies, the trial court held the USF&G policy excluded employees from coverage and this exclusion was in conformity with South Carolina statutory law. As an additional sustaining ground, the trial court held Canty was a Class I insured under the Farm Bureau policy and a Class II insured under the USF&G policy. The trial court concluded Canty must exhaust his Class I UIM coverage under the Farm Bureau policy before he could receive any Class II UIM coverage under the USF&G policy. Accordingly, the trial court ordered Farm Bureau to reimburse $11,000 to USF&G.
I.
Farm Bureau argues the trial court erred in its interpretation of the USF&G policy because the trial court relied upon exclusions contained in the liability section of the policy as opposed to the language of the UIM endorsement. Farm Bureau contends the UIM endorsement controls and by this endorsement USF&G provided primary UIM coverage to Canty. We agree.
USF&G issued a business automobile insurance policy to Scottswood Properties. The policy provided liability, uninsured, and underinsured motorist coverages in the amount of $500,000 each. Section II of the policy outlines the liability coverage. Section (B)(3) of the liability section contains the following exclusions:
This insurance does not apply to any of the following:
(3) WORKERS COMPENSATION
Any obligation for which the "insured" or the
"insured's" insurer may be held liable under any
workers compensation, disability benefits or
unemployment compensation law or any similar law.
(4) EMPLOYEE INDEMNIFICATION AND EMPLOYER'S
LIABILITY
"Bodily injury" to: (a) n employee of the
"insured" arising out of and in the course of
employment by the "insured,"
But this exclusion does not apply to "bodily
injury" to domestic employees not entitled to
workers compensation benefits or to liability
assumed by the "insured" under an "insured
contract."
The USF&G policy also contained an endorsement for uninsured and underinsured motorist coverage in a form provided and approved by the Insurance Services Office. This form interchanged the terms uninsured and underinsured motor vehicle throughout its definitional section. The relevant provisions of the endorsement provide as follows:
A. COVERAGE
1. We will pay in accordance with the South
Carolina Uninsured Motorists Law all sums the
"insured" is legally entitled to rec
Page 1 2 3 South Carolina Personal Injury Attorneys