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Insurance — automobile policies — UIM coverage — governmental immunity

By: WISCONSIN LAW JOURNAL STAFF//October 2, 2014//

Insurance — automobile policies — UIM coverage — governmental immunity

By: WISCONSIN LAW JOURNAL STAFF//October 2, 2014//

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Wisconsin Court of Appeals

Civil

Insurance — automobile policies — UIM coverage — governmental immunity

An exclusion to UIM coverage, where the underinsurance is the result of damage caps for torts by government employees is unenforceable.

“As in Trampf, the exclusion here in fact violates other applicable law, namely, WIS. STAT. § 632.32(4)(a)2m., which requires, in pertinent part, underinsured motorist coverage for ‘every policy of insurance … with respect to any owned motor vehicle registered … in this state against loss resulting from liability imposed by law for bodily injury.’ (Emphasis added.) This subsection requires that underinsured motorist coverage applies in all cases, and excluding coverage for government vehicles violates that applicable law.”

“State Farm does not attempt to distinguish Trampf. Instead, State Farm cites to Progressive Northern Insurance Co. v. Hall, 2006 WI 13, 288 Wis. 2d 282, 709 N.W.2d 46, and Mau v. North Dakota Insurance Reserve Fund, 2001 WI 134, 248 Wis. 2d 1031, 637 N.W.2d 45, to support its assertion that the government vehicle exclusion ‘is valid under [WIS. STAT. § 632.32](5)(e) because it is not prohibited by any other statute.’ State Farm’s reliance on these cases is misplaced. In Hall, the court determined that an insurer’s ‘other insurance’ clause was not an exclusion, and, thus, the insurer could not rely on § 632.32(5)(e) (2003-04) to ‘save’ this clause. 288 Wis. 2d 282, ¶¶24-33. In Mau, the court concluded that an ‘occupancy requirement’ violated both the prohibition against excluding from coverage a named insured pursuant to WIS. STAT. § 632.32(6)(b)2.a. (1995-96), and the requirements for a ‘drive other car’ exclusion in § 632.32(5)(j) (1995-96). 248 Wis. 2d 1031, ¶¶34-38. State Farm fails to explain how either of these cases applies here or why they compel a different conclusion in light of Trampf.”

Reversed.

Recommended for publication in the official reports.

2013AP2518 State Farm Mut. Auto. Ins. Co. v. Hunt

Dist. IV, Columbia County, White, J., Blanchard, J.

Attorneys: For Appellant: Tyndall, Susan R., Waukesha; Rogers, Christopher E., Madison; Blocher, Jesse, Waukesha; For Respondent: Covelli, Claude J., Madison

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