In Hartford Underwriters Insurance Company v. Donna Ledbetter, the Missouri Court of Appeals considered whether an insurance policy’s language was ambiguous thus warranting coverage in favor of the insured. Ledbetter received injuries in a car wreck when another car driven by Danny Harris struck her car. Ledbetter sued Harris for her personal injuries and later settled the suit in exchange for his liability insurance policy limit of $50,000. Ledbetter then attempted to recover $200,000.00 against her insurer, Hartford, under the Underinsured Motorist provision of the Policy. Hartford denied that Harris’ vehicle was underinsured. Both parties filed a Motion for Summary Judgment and the trial court entered judgment in favor of Hartford finding that Harris’ vehicle failed to meet the Policy’s definition of an underinsured vehicle. Ledbetter appealed.
The appellate court’s review focused on the Policy’s “Other Insurance” clause pertaining to underinsured motorist coverage. The applicable provision stated, “Any insurance we provide with respect to a vehicle you do not own shall be excess over any collectible insurance providing such coverage on a primary basis.” Ledbetter argued the provision was ambiguous and required a construction that the underinsured motorist coverage was excess to the tortfeasor liability coverage regardless of whether she occupied the non-owned vehicle because a requirement that she actually occupy the non-owned vehicle was not contained in the policy.
“Language in an insurance policy is ambiguous if it is reasonably open to different constructions, and the language used will be viewed in the light of the meaning that would ordinarily be understood by a layman who bought and paid for the policy.” Hobbs v. Farm Bureau Town & Casualty Ins. Co., 965 S.W.2d 194, 197-98 (Mo. App. 1998).
The Court considered Goza v. Hartford Underwriters Ins. Co., 972 S.W.2d 371, 372 (Mo. App. 1998) where Hartford’s “Other Insurance” clause, which mirrors the “Other Insurance” clause in question, was found ambiguous and resolved in favor of the insured despite the fact that Goza was driving her own insured vehicle at the time of the accident. The Goza Court found the policy ambiguous because one could reasonably interpret the ‘excess coverage’ language as providing coverage for a vehicle that the insured did not own, while the ‘excess coverage’ language could also be interpreted as providing underinsured coverage in excess to amounts recovered from tortfeasor.
This Court held that an objective examination of the ‘excess’ language of the “Other Insurance” clause suggests that the language might reasonably be interpreted by an average lay person to mean underinsured coverage was excess to amounts recovered from the tortfeasor. It also could be interpreted to mean that the ‘excess’ language prevailed over the conflicting language contained in the Policy’s definition of an underinsured and Limits of Liability sections.
The trial court’s grant of summary judgment was reversed and remanded.
