Court Rules that Passenger in Automobile Accident Cannot Receive Insurance Coverage

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Back in December 2009, Rhiannan Wolf was a passenger in a vehicle that was involved in an automobile accident. Following the accident, Ms. Wolf recovered $250,000 under the vehicle driver’s underinsured motorist insurance policy. Ms. Wolf then sought additional underinsured motorist coverage under her insurance policy. Because Ms. Wolf’s underinsured motorist policy had the same $250,000 limit as the driver’s policy, the insurance company declined coverage to Ms. Wolf. The insurance company claimed that the insurance policy’s “reducing clause,” which operated to reduce insurance coverage by any amounts paid to the insured from other sources, reduced Ms. Wolf’s coverage to zero.

Ms. Wolf brought a lawsuit against the insurance company, relying upon the insurance policy’s elasticity clause, which provides that an insurance policy must conform to state law. Ms. Wolf argued that, because Wisconsin law changed in November 2009 to render reducing clauses illegal, the reducing clause in her policy was illegal and she was therefore entitled to coverage. The Court of Appeals rejected Ms. Wolf’s argument, holding that the elasticity clause did not apply because she had renewed her insurance policy prior to the change in Wisconsin law. Read the entire Court of Appeals opinion here.

The Milwaukee personal injury lawyers of Samster, Konkel & Safran have extensive experience helping clients obtain insurance coverage benefits. We assist in recovering for personal injuries, pain and suffering, property damage and lost wages. If you or some you know has been injured in an accident,contact us for a free case evaluation.

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