Michael Cline and Jacob Sofronko v. Everest National Insurance Company

Summary

The Indiana Court of Appeals affirmed summary judgment for Everest National Insurance Company in a dispute over underinsured motorist coverage. The court held that the policy’s unambiguous provision reducing the $1,000,000 per-accident limit by all sums paid by legally responsible parties permitted a $300,000 setoff for the tortfeasor’s insurer’s payment. The court concluded that $700,000 was the maximum UIM coverage available and that the policy complied with Indiana statutory limits.

Holdings

1. The unambiguous UIM endorsement entitled Everest to reduce the $1,000,000 per-accident limit by the entire $300,000 paid by Shelter on behalf of the legally responsible tortfeasor, leaving $700,000 in available UIM coverage.
2. Indiana Code section 27-7-5-5(c) establishes maximum and minimum parameters for an individual claimant's recovery; it does not prescribe a formula for calculating an insurer's aggregate available coverage or prohibit an aggregate setoff under a per-accident policy provision.
3. The Everest UIM coverage was not illusory because the policy would provide benefits under reasonably expected circumstances and, in this case, provided $700,000 in benefits.

Questions Presented

1. Whether the Everest UIM endorsement unambiguously permitted Everest to reduce the $1,000,000 per-accident limit by the entire $300,000 paid by the at-fault driver's insurer.
2. Whether Indiana Code section 27-7-5-5(c) or Lakes v. Grange Mutual Casualty Co. required UIM coverage to be calculated separately for each claimant and prohibited an aggregate setoff.
3. Whether the Everest UIM coverage was illusory because the policy's setoff provision prevented payment of the full $1,000,000 limit.

Disposition

affirmed