Missouri Supreme Court Rules Driver Entitled to Underinsured Motorist Coverage After Motorcycle Accident

A person injured in a motorcycle accident is entitled to recover underinsured motorist coverage under several insurance policies, according to the Missouri Supreme Court’s ruling in Manner v. Schiermer, et al, No. SC92408, slip op. (Mo., Jan. 8, 2013). The defendant insurance companies contended that “owned-vehicle” exclusions applied to the plaintiff’s claim. The court reversed a lower court’s summary judgment order in the defendants’ favor, holding that the policies did not define “owned vehicle,” that the insurance companies had the burden of proving that the exclusion applied to the plaintiff, and that they failed to do so. It further held that the provisions of the policies allowed “stacking” of the coverage provided by each policy.

The plaintiff, Nathaniel Manner, was riding a Yamaha motorcycle on September 25, 2004 when a vehicle driven by Nicholas Schiermeier struck him. Manner suffered serious injuries, with damages totaling $1.5 million. Schiermeier’s insurer settled Manner’s lawsuit for the policy limit of $100,000, leaving him with $1.4 million unpaid. Manner made claims on four separate insurance policies: three policies in Manner’s name through American Family Mutual Insurance Company for the Yamaha motorcycle and two pickup trucks; and a policy held by Manner’s father through American Standard Insurance Company for a Suzuki motorcycle, which named Manner as an additional insured. Each policy had $100,000 in underinsured motorist coverage. Both insurance companies denied coverage under all of the policies.

Manner added American Family and American Standard to the lawsuit as defendants. He alleged that the limits of the four policies could be stacked, entitling him to $400,000 of coverage. The insurance companies moved for summary judgment, asserting that an owned-vehicle exclusion in the policies covering the trucks and the Suzuki motorcycles precluded coverage of Manner’s injuries. The exclusions stated that bodily injury was not covered if the insured was occupying a vehicle “owned by [the insured] or any resident of [the insured’s] household.” Slip op. at 4. The defendants argued that Manner owned the Yamaha and that the three policies did not directly insure the Yamaha; therefore, the three policies’ owned-vehicle exclusions applied to Manner’s claim. The lower court granted the defendants’ motion, and the case made its way to the Missouri Supreme Court.

In reversing the summary judgment order, the Supreme Court noted that an insurer has the burden of proving that a coverage exclusion applies. The court further noted that, while Manner had possession of the Yamaha motorcycle, Manner’s uncle still held title to it while Manner made payments to him. Manner at most held an “insurable interest” in the motorcycle, id. at 6, and the court held that the defendants failed to prove that this was sufficient to establish ownership. None of the policies expressly defined the word “owned” as it was used in the exclusion, and the court held that none of the evidence presented by the defendants met any definition of ownership established by Missouri caselaw. The court also held that an “other insurance” clause in the policies allowed stacking of the coverage. Since the $400,000 in stacked coverage was far less than the $1.4 million in unpaid damages, the court reversed the trial court’s order and remanded the case.

Motorcycle accident attorney Doug Horn is an advocate for safe driving in the greater Kansas City area. He represents the rights of people who have suffered injuries or lost loved ones due to the negligent or illegal conduct of others. Contact us today online or at (816) 795-7500 to schedule a free and confidential consultation.

Photo credit: By Roger Hartmans (Self-published work) [GFDL or CC-BY-SA-3.0], via Wikimedia Commons.