Did Attempted Restriction of Car Accident Coverage Violated the Uninsured Motorist Statute ?
In Rockford Mutual Insurance Co. v. Economy Fire & Casualty Co., 217 Ill. App. 3d 181, 576 N.E.2d 1141, 160 Ill. Dec. 187 (1991), an Economy policy otherwise covering the Fred family automobile precluded all coverage if such vehicle was operated by Durbin. Rockford Mutual, 217 Ill. App. 3d at 183.
While driving that vehicle, Durbin caused a crash killing his passenger, Larry Sneed. Rockford Mutual, 217 Ill. App. 3d at 183-84.
Sneed's mother, as administrator of his estate, made a liability claim against Economy and, after it was denied based on the named insured exclusion, sought uninsured motorist benefits through her own Rockford Mutual policy that also covered her son as a member of her household. Rockford Mutual, 217 Ill. App. 3d at 183.
Rockford Mutual, in turn, sought a judicial declaration that uninsured motorist benefits were actually due under the Economy policy and that the attempted restriction of the Economy coverage violated the uninsured motorist statute. Rockford Mutual, 217 Ill. App. 3d at 183.
In rejecting Rockford Mutual's argument, the appellate court reasoned:
"The purpose of the statute, and the public policy expressed therein, is to provide protection to policyholders and named insureds for whom protection is specifically contracted, and not to provide protection to third parties who are strangers to the contract of insurance.
Policyholders and named insureds may recover under their own insurance policy when they are injured as a result of an accident in or with an uninsured motorist or vehicle, just as an injured third party may recover under his or her own uninsured motorist insurance if he or she is injured as a result of an accident in or with an uninsured motorist or vehicle.
Thus, if a passenger is injured in an uninsured vehicle, as in the instant case, that passenger must look to his own insurance policy for recovery under its uninsured motorist provision.
Because this was the intention and purpose of the statute, it does not violate public policy to recognize the named driver exclusion endorsement in the Economy policy, which renders the vehicle insured thereunder an uninsured vehicle, treat it as such, and require Grace to seek recovery under her own Rockford policy for the death of her son." Rockford Mutual, 217 Ill. App. 3d at 186-87.