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Eighth Circuit Denies Uninsured Motorist Coverage Where Negligent Driver Had Excess Liability Policy – Jung v. General Casualty Co.

By August 12, 2011July 18th, 2019Auto Accidents

As a Missouri auto accident lawyer, I was interested to see a ruling in an underinsured motorist insurance case involving another part of the Eighth Circuit, North Dakota. Underinsured motorist insurance can be a lifesaver when you are hit by someone who does not have enough insurance to cover the damage they cause — but only if the insurer agrees to pay out. That was the point of contention in Jung v. General Casualty Company of Wisconsin, a case arising out of a serious injury to John Jung of North Dakota. Jung was hit by Richard Martin, whose insurance payout was not sufficient to cover all of Jung’s injuries. Jung and his wife, Janice Jung, sued Jung’s employer’s insurance company for access to its underinsured motorist coverage, but the district court denied this, saying Martin’s excess liability coverage made him not underinsured as a matter of law. The Eighth U.S. Circuit Court of Appeals agreed.
John Jung was at work, driving his employer’s truck, when he was hit by Martin and sustained serious injuries. The employer, Tooz Construction, carried a $1 million underinsured motorist policy. Martin had insurance for $250,000 per person and $500,000 per accident, plus a $1 million excess liability policy. The Jungs eventually settled with Martin and his insurer, Nodak Mutual, for $1.25 million, the limits of the excess liability and per-person insurance. They then claimed the underinsured motorist coverage offered by Jung’s employer’s insurance company, General Casualty, but this was denied on the grounds that Martin was not underinsured. The Jungs sued, and General Casualty moved for summary judgment, arguing that Martin was not underinsured as a matter of law. A magistrate judge’s report agreed, and summary judgment was granted. The Jungs moved to certify a question on the issue to the North Dakota Supreme Court, which was denied. They appealed both issues.
The Eighth Circuit started with the summary judgment ruling. Under North Dakota law, it said, a vehicle is only underinsured if the limits of its policy are less than the limits of the underinsured motorist policy the injured person seeks to collect from. Martin’s base insurance provided $250,000, the court noted, which is less than the $1 million limit under General Casualty’s underinsured motorist coverage. However, General Casualty argued that Martin’s excess liability policy of $1 million should be counted. The Eighth agreed. A North Dakota case finding UIM was appropriate did not apply here, it noted, because one policy in that case was disregarded for not covering the actual vehicle involved. By contrast, this case involves Martin’s own excess liability insurance covering the vehicle Martin owned and used in the crash. Other jurisdictions using a “gap” method to calculate underinsurance have come to similar conclusions, it noted. Thus, it upheld the summary judgment ruling. It also upheld the certified question issue, saying the Eighth Circuit generally does not allow certified questions after a case is decided, and it saw no need to ask the state high court to get involved.
This kind of case is relevant to my work as a St. Louis car crash attorney because insurance disputes can determine how much money my clients ultimately collect. This case did not specify what kind of injuries John Jung sustained, but they were likely very serious. Not only did the case say so, but the Jungs’ pursuit of the underinsured motorist coverage suggests that $1.25 million was insufficient to cover his injuries. That suggests something very serious, such as a head injury or paralysis, because the most serious injuries are also generally the most expensive. Permanently disabled people often need at least some help with daily life and frequent checkups, and they often cannot work anymore. All of this makes it worthwhile to go back to court for more compensation, even though, as a southern Illinois car wreck lawyer, I know court proceedings can be long, and sometimes upsetting.

If you or someone you love was seriously hurt by someone else’s careless driving, Carey, Danis & Lowe can help. For a free, confidential case evaluation, send us a message online or call 1-877-678-3400.
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