Allstate Insurance Co. v. Pilosof

Citations: 871 P.2d 351; 110 Nev. 311; 1994 Nev. LEXIS 37Docket: 24139

Court: Nevada Supreme Court; March 30, 1994; Nevada; State Supreme Court

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On May 6, 1992, Rochelle Pilosof filed a complaint for declaratory relief against American Hardware Insurance Group and Allstate Insurance Company regarding primary coverage responsibilities after she was involved in an accident with an uninsured driver on February 5, 1991. Pilosof was driving a loaner car, owned by Cashman Cadillac Inc. and insured by Hardware, while her own vehicle was being repaired. Pilosof had her own policy with Allstate and filed claims with both insurers, which denied coverage, deferring to each other.

Pilosof argued that NRS 690B.025 determined the primary and excess coverage responsibilities. Hardware, supported by Pilosof, moved for summary judgment, asserting that NRS 690B.025 applied, which the district court agreed with, ruling that Allstate's policy was primary and Hardware's was excess.

On appeal, the primary legal question was whether NRS 690B.025 assigned primary coverage to Allstate rather than Hardware. The statute states that if a customer is lent a vehicle during repairs, the customer's insurance policy is primary. Allstate contended that NRS 690B.025 did not apply as it pertains only to liability insurance and not to uninsured motorist coverage. The court concurred, emphasizing the distinction between liability insurance, which covers third-party liability, and uninsured motorist coverage, intended for the insured's own losses. Pilosof and Hardware claimed that since Nevada law mandates uninsured motorist coverage with liability insurance, it should be considered a subset of liability coverage.

Uninsured motorist coverage can be included in a liability insurance policy or as a supplemental product under NRS 690B.020. The statute does not classify uninsured motorist protection as a subset of liability insurance; rather, it mandates its provision either as part of the liability policy or separately. In the case at hand, the Allstate policy distinctly separated liability insurance and uninsured motorist insurance, indicating they are different components of the overall coverage. Pilosof’s claim specifically pertains to the uninsured motorist section, not the liability section. The assertion that uninsured motorist coverage replaces liability coverage is incorrect; it serves as first-party coverage for injuries caused by uninsured parties rather than substituting the insured's own liability insurance.

The court has recognized the differences between liability and uninsured motorist coverage, noting that the former cannot be stacked as the latter can. The appellants incorrectly claim that their situation parallels previous rulings regarding stacking in uninsured motorist cases. There is a clear distinction between first-party coverages, which benefit the insured and their beneficiaries, and third-party liability coverages, which arise from vehicle ownership and usage.

Additionally, while insured individuals can opt out of uninsured motorist coverage, they are required to maintain liability insurance unless they are self-insured, per NRS 485.185. Although it is conceivable that the legislature did not intend to differentiate between liability and uninsured motorist coverage regarding primary responsibility in accidents with loaner cars, the court cannot speculate on legislative intent without statutory ambiguity, which is not present here.

Consequently, NRS 690B.025 is deemed inapplicable to the current case. The court must determine which policy provides primary coverage, similar to the precedent set in Co-operators Ins. Co. v. Allstate Rent-A-Car, where the more specific language in one policy governed. However, the Hardware policy was not included in the appeal records, preventing the court from applying this rule. Thus, the issue of which policy contains the more specific language must be resolved in the district court. Ultimately, NRS 690B.025 does not apply to claims against uninsured motorist coverage.

The court applies the standard from Co-operators Ins. to the case, reversing the summary judgment and remanding the matter to the district court for further proceedings. NRS 690B.020(1) mandates that motor vehicle insurance policies must include coverage for injuries caused by uninsured or hit-and-run vehicles, unless the insured explicitly rejects this coverage in writing. This required coverage is termed 'uninsured vehicle coverage.' Additionally, NRS 687B.145(2) obligates insurance companies in the state to offer uninsured and underinsured vehicle coverage equivalent to the bodily injury limits in a passenger car policy. It is noted that NRS 485.3091 does not list uninsured motorist protection among the mandatory inclusions in a motor vehicle liability policy.