 |
 |
to fill out a simple form to connect to Personal Injury Lawyers in your area.
|
|
|
|
|
Iowa Mutual Insurance Co. v. Davis3/18/1988
which the compensation of innocent automobile accident victims can be sidestepped. Our ruling does not, however, prohibit an insurer from entering into agreements with their insureds to limit coverage to the statutory minimum amounts as set forth in Section 61-6-103, MCA. Other states have reached similar conclusions.
The Supreme Court of Utah invalidated a named driver exclusionary endorsement only to the extent that the endorsement excluded statutorily required minimum liability coverage in Allstate Ins. Co. v. U.S. Fidelity & Guaranty (Utah 1980), 619 P.2d 329. The Utah court held that the exclusion was enforceable as to any insurance coverage above minimum limits and noted the following:
"Our decision does not, however, read the named driver exclusionary endorsement out of the contract entirely. Rather, contracting parties are free to limit coverage in excess of the minimum required limits, and the exclusion found in the contract is valid in relation to any coverage exceeding the minimum amounts. Thus, a balance is struck between the necessity of securing minimum automobile liability coverage and the availability of lower premiums because of the exclusion of high insurance risks. This effectuates the express two-fold purpose of the Utah No-Fault Insurance Act which is to require the payment of certain prescribed benefits in respect to motor vehicle accidents while stabilizing the rising costs of automobile accidents insurance."
Allstate, 619 P.2d at 333. The Oklahoma Supreme Court reached a similar conclusion in Young v. Mid-Continent Cas. Co. (Okla. 1987), 743 P.2d 1084. In holding that an exclusion was invalid, the Young court noted that the intent of Oklahoma's compulsory liability insurance statutes was not so broad as to "eliminate all possible bargaining regarding liability exclusions . . ." but that the intent did "require a minimum of protection to any party who is not a party to the contract." Young, 743 P.2d at 1088.
The enforcement of minimum statutory coverage is mandated by statute in Montana and is a minor burden on insureds when compared to increased protection of the general traveling public. Iowa Mutual's attempt to exclude Jeffrey Davis from coverage is contrary to the mandatory liability coverage requirements of Section 61-6-301, MCA, and is repugnant to this state's interest in protecting innocent victims of automobile accidents. The United States District Court is instructed that the provisions of Title 61, Chapter 6, Part 3, MCA, prohibit the exclusion of named drivers from statutory minimum coverage under a motor vehicle liability policy.
Question answered in the affirmative.
MR. CHIEF JUSTICE TURNAGE and MR. JUSTICES HARRISON, SHEEHY, WEBER, HUNT and McDONOUGH concur.
|