eNotes: Liability – January 2023 – Virginia

SIGNIFICANT CASE SUMMARIES

Virginia Case Summary

GEICO Advantage Ins. Co. v. Miles
Virginia Supreme Court
No. 220004

Decided: December 1, 2022

Underinsured motorist coverage does not provide a means of recovery separate from uninsured motorist coverage.

Background

The Plaintiff, Liosha Miles, was seriously injured in an automobile accident caused by the negligence of two drivers. One driver, Carlos Figuero, was insured by Integon General Insurance Company (“Integon”), with a liability limit of $25,000. The second driver (“Doe”) was never identified and was therefore considered uninsured as a matter of law. Miles was insured under two different GEICO policies: a GEICO Advantage Policy and her brother’s GEICO Choice policy. Both policies contained UM/UIM coverage with bodily injury limits of $50,000 per person and $100,000 per occurrence. Integon tendered its policy limit of $25,000 on behalf of Figuero.

Claiming Integon’s coverage as a credit, GEICO Advantage tendered $25,000 related to Miles’ claim against Figuero, and an additional $25,000 related to Miles’ claim against Doe, meaning that GEICO Advantage tendered $50,000 total. GEICO also tendered $50,000 to Miles under the GEICO Choice policy related to Miles’ claim against Figuero, but offered nothing for her claim against Doe. GEICO asserted that it had exhausted the limits of the UM/UIM coverage under both policies. Miles disagreed, asserting that the GEICO Advantage Policy provided her $75,000 in coverage, consisting of $50,000 in UM coverage for her claims related to Doe and $25,000 ($50,000 less the $25,000 credit for Integon’s tender) in UIM coverage for her claims related to Figuero. She further claimed that the GEICO Choice policy provided her with $100,000 in coverage, consisting of $50,000 in UM coverage for claims related to Doe and $50,000 in UIM coverage for her claims related to Figuero.

Holding

The Court ultimately held that UIM coverage is a constituent part of UM coverage and does not provide a separate tranche of funds to be used when UM coverage has been exhausted. Virginia Code § 38.2-2206(A) requires policies have only one endorsement that provides coverage for damages caused by uninsured and underinsured motorists, suggesting that only one tranche of funds is required. Further the statute provides that coverage limits for the UM/UIM endorsement shall equal but not exceed the limits of liability insurance. If UIM coverage were separate from UM coverage, it would follow that the General Assembly placed a cap on UM coverage, but no corresponding cap on UIM coverage, which would be absurd. The purpose of the statute was to allow insured individuals to receive the same level of protection, regardless of the insurance status of the individual who injures them. To distinguish between underinsured and uninsured individual when determining the available coverage would disregard that purpose.

Questions about this case can be directed to Mackenzie Payne at (571) 470-1906 or mpayne@tthlaw.com.