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Insurance — UIM coverage

Wisconsin Supreme Court


Insurance — UIM coverage

The policy term “self-insurer” is ambiguous because it is unclear whether a reasonable insured would understand that a car rental company which is statutorily liable under sec. is a “self-insurer” under the policy.

“To apply the policy term ‘self-insurer’ to the Avis rental vehicle is similarly an unreasonable interpretation. It makes no sense for Owners to sell Kathryn $500,000 of UIM coverage excluding a ‘self-insurer’ and to then turn around and apply that policy term to a car rental company who is statutorily liable for a minimal amount not because it is a self-insurer, but because it is a car rental company.”

“We decline to adopt an interpretation of the policy that leads to such an absurd result. Just as in Murray, the ambiguity in Owners’ policy is fatal to its arguments that the policy does not extend coverage to the Avis rental vehicle. Id. at 764. To avoid an absurd result, we interpret the policy in favor of the insured. See Olguin v. Allstate Ins. Co., 71 Wis. 2d 160, 165, 237 N.W.2d 694 (1976).”


2010AP3153 Bethke v. Auto-Owners Insurance Co.

Bradley, J.

Attorneys: For Appellant: Te Winkle, William P., Sheboygan; Waldon, Stephanie Erin, Sheboygan; For Respondent: Schmidt, Richard E., Milwaukee; Ratkowski, Allen M, Milwaukee; Calkins, Thomas T., Greenfield

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