The Missouri Court of Appeals for the Western District recently reaffirmed that owned-vehicle exclusions in automobile liability insurance policies that provide uninsured motorist coverage are enforceable for any coverage limits above the $25,000 minimum required under Missouri’s Motor Vehicle Financial Responsibility Law (MVFRKL). Jones v. American Family Mutual Insurance Company, S.I., 632 S.W.3d 482 (Mo. App. W.D. 2021)
Plaintiff Courtney Jones was driving her 2014 Toyota Sequoia when another driver turned left in front of her, causing a collision that resulted in serious injuries to her neck and arm. The other driver did not have automobile liability insurance at the time of the collision, so Plaintiff turned to her own insurance carrier to recover for her injuries under the uninsured motorist (“UM”) provisions of three separate policies issued to her for three different vehicles she owned.
At the time of the collision, Plaintiff was insured for $100,000 in UM coverage under a policy which listed the 2014 Toyota Sequoia she was driving at the time of the accident. It was undisputed that Plaintiff was entitled to coverage in that amount, and the carrier tendered those limits. However, Plaintiff was also insured for UM coverage under two additional automobile liability policies issued by the same insurance carrier covering two other vehicles also owned by Plaintiff. Those policies indicated a UM coverage limit of $100,000 per person. Accordingly, Plaintiff sought an additional $200,000 in UM coverage.
The carrier contended that an owned-vehicle exclusion in each of the two policies limited its coverage obligation to the $25,000 minimum UM coverage limit required under Missouri’s Motor Vehicle Financial Responsibility Law. The owned-vehicle exclusion stated that no coverage was provided for bodily injury sustained by the insured “while occupying … a motor vehicle that is not insured for this coverage under the policy if it is owned by you or any residents of your household.” Since it was undisputed that Plaintiff was occupying a vehicle she owned that was not insured under the two additional policies, the carrier argued that the exclusion applied. The policies then stated: “If any uninsured motorist insurance law or financial responsibility law determines that any exclusion is unenforceable,” then the carrier would pay the statutory minimum. The policies also stated in the Limits of Liability section that “in no event shall the amount we pay to the insured person be reduced below the Missouri Motor Vehicle Financial Responsibility Law minimum limit.” Against this backdrop, the carrier sought to resolve Plaintiff’s UM claim for a total of $150,000, representing the $100,000 UM limit under the Sequoia policy and $25,000 under each of the additional two policies.
The parties submitted competing Motions for Summary Judgment on a stipulated set of facts. The trial court ruled that the policies were “ambiguous, when read as a whole, because the policies unequivocally and unconditionally promise $300,000 in UM coverage” on the Declarations pages and in the insuring agreements, but then took such coverage away in the Exclusions sections of the policies. Accordingly, the court entered judgment in favor of Plaintiff, finding her entitled to an additional $200,000 in UM coverage.
On appeal, the Missouri Court of Appeals for the Western District reversed the grant of summary judgment in favor of Plaintiff and directed the trial court to enter judgment in favor of the insurer. In so doing, the court reaffirmed that “the Declarations page[s] of insurance policies do not grant any coverage [emphasis in original],” but are “introductory and merely summarize the essential terms of the policy,” while the “definitions, exclusions, conditions and endorsements are necessary provisions” which “determine the scope of coverage.”
While Missouri law requires UM coverage of at least $25,000 in all policies issued in the state, the court noted that exclusions to UM coverage are generally only unenforceable when they seek to completely bar an insured from receiving any UM coverage at all, as enforcing such an exclusion would violate Missouri public policy behind the MVFRL.
Here, while the exclusion purported to deny UM coverage to the Plaintiff if she was injured while occupying an owned vehicle not insured under the policy, the exclusion clarified that it only applied to coverage limits in excess of the $25,000 mandatory minimum. Accordingly, the court held that the exclusion was “unenforceable up to the mandatory minimum amount of UM coverage required under [the MVFRL], but is otherwise enforceable as to any coverage exceeding the mandatory minimum amount.”
The appellate court’s opinion is an affirmation of, rather than a departure from, existing Missouri case law. In fact, the court noted that an owned-vehicle exclusion to UM coverage had been enforced for coverage in excess of the mandatory minimum by both the Missouri Supreme Court and the Missouri Court of Appeals for the Southern District. The court also reaffirmed that insureds must look beyond the Declarations page of a policy to determine the scope of coverage, and that the mere presence of an exclusion to coverage does not render the policy ambiguous.
In short, Missouri courts appear poised to continue to enforce limitations and exclusions to UM coverage provided that the insured recovers the mandatory minimum required under the MVFRL.