Uninsured motorist policies clarified

Friday, Sept. 3, 2004 | 9:41 a.m.

CARSON CITY -- Car owners who buy insurance policies to cover them against uninsured or underinsured drivers can collect on those policies if they are injured while riding in another vehicle, the Nevada Supreme Court ruled Thursday.

The court, in a decision written by Justice Bill Maupin, said the limit on benefits is $15,000 per person injured or killed and $30,000 total for two or more persons injured or killed in a single accident.

The ruling reaffirms prior court decisions involving uninsured-underinsured policies that are purchased by motorists to protect them in accidents where the other driver doesn't have insurance.

The case involved Penny and Patrick Murphy who purchased the coverage for their classic 1969 Plymouth Roadrunner in Clark County. Penny was seriously injured while riding a motorcycle owned by a third party. She submitted a claim to Continental Insurance Company. The company contested the case.

District Judge Nancy Saitta ruled that Penny's claim should be processed but only up to the $15,000-$30,000 limit.

Maupin wrote, "We have traditionally held that UM/UIM (uninsured motorist and underinsured motorist) insurance follows the insured regardless of whether the accident involved the vehicle designated in the policy."

Continental said the prior rulings of the court limit its ability to market new insurance policies at lower prices. It suggested it should be able to bargain with the car owner for restrictive coverage, such as limiting it to one vehicle. In exchange there would be a lower premium.

The court said Continental would have to go to the Legislature for any change in the law.