In the case of State Farm Automobile Insurance Company v. Marielle Lyde, Case Number 2D17-1014 (Fla. 2d DCA October 5, 2018), Florida’s Second DCA held that family members who live in the same household but have their own separate automobile policies do not get to choose the highest UM limit in the household unless they are occupying the vehicle with the higher UM limits.
The plaintiff in this case lived with her mother but had her own vehicle and her own automobile insurance policy. Her UM policy limits were $25,000 while her mother’s UM policy limits were $100,000.
In any event, the plaintiff got into a car accident with an uninsured motorist. Thereafter, State Farm tendered their $25,000 UM limits to her, however, she filed a UM lawsuit and declaratory action seeking coverage limits of $100,000 under the “other insurance” clause of her mother’s policy, which was also with State Farm. The “other insurance” clause operates to give a claimant the highest applicable limit in the event that more than one insurance policy applies to a given claim.
The trial judge found that there was “ambiguity” in State Farm’s policy as the plaintiff was a “resident, relative household member” under her mother’s policy as well as an “insured” under her own policy limit. State Farm appealed.
Clear Up The Confusion
While the plaintiff in this case is “insured” under her mother’s policy (and the same goes for her mother under her daughter’s policy, even though the opinion doesn’t directly say so), the problem is that the plaintiff was not in her mother’s car at the time of the accident. If the plaintiff had been a driver or passenger in her mother’s car at the time of the accident, then the “other insurance” clause would operate to give her the highest limit among all applicable insurance policies.
To allow otherwise would allow one family member in a household to buy a large UM policy and then everyone else in same house to buy only a minimal UM policy but still get the protection of the large UM policy. You can clearly see the potential for collusion and abuse.
The Second DCA specifically commented on this subject in the opinion that:
[b]y limiting UM coverage to the coverage available as to the vehicle involved and by precluding coverage for injuries sustained while occupying a vehicle for which UM coverage was not purchased, subsections 627.727(9)(b) and (d) permit departure from the general principle…that UM coverage applies to the person.
How Does Stacking Apply?
In this particular case, the plaintiff rejected UM stacking on her policy. However, stacking would not have changed the outcome in this case because the plaintiff was still driving her own car. It would have been different if the plaintiff had stacking on her policy and was occupying her mother’s car at the time of the accident. It would also have been different if the plaintiff had been a “named insured” on her mother’s policy rather than just a “derivative insured” (resident household member). These facts all make a significant difference.