Automobile insurance is a tricky thing, and it's safe to say many don't fully understand what their insurance coverage actually means. The level of insurance coverage a vehicle owner buys often has to do with the level of risk that person is most comfortable with and where that comfort level intersects with their financial abilities. To hedge bets against those less risk averse than they are, many vehicle owners purchase what is called "uninsured motorist coverage." The intent behind uninsured motorist coverage is to help the insured recover damages caused by a driver who doesn't have insurance on their own vehicle. Oftentimes, it also helps the insured recover damages caused by an unknown motorist, most commonly seen in a hit-and-run situation. But it's not always that simple.
In Tennessee, the commentators and case law agree that, in order to recover from an insurance provider under an uninsured motorist (UM) policy, the insured must first have a cause of action against the uninsured motorist for negligence. "UM coverage is not, and never has been, 'no fault coverage'. Rather, as required by the terms of the statute and the insuring clauses, there must be legal liability for the ownership, maintenance, or use of the uninsured motor vehicle before benefits are payable. The fundamental requirement of legal liability on the part of the uninsured motorist distinguishes UM coverage from other first party coverages in which legal fault is not relevant."1
The case law backs this up. Tennessee statutes require that "where an insured has purchased UM coverage, the UM carrier must pay benefits in cases where [a] claimant is legally entitled to recover damages from the uninsured motorist."2 To be "legally entitled" to recover UM benefits, a claimant must prove damages and fault on the part of the uninsured motorist.3 A plaintiff who fails to establish legal liability against a uninsured driver cannot impose liability upon his uninsured motorist carrier for the acts of that same driver.4 Simply put, if the insured is not entitled to compensation from the uninsured motorist, the insured would not be entitled to compensation from the UM coverage carrier.5 The statute "cannot be read as providing a victim of an uninsured motorist with a more effective remedy against its own uninsured motorist carrier than he would have against the uninsured motorist himself.6
What does this mean for vehicle owners and insurance lawyers alike? Simply, whether an insurance company has the obligation to pay insurance benefits is dependent upon a determination of negligence on the part of the uninsured or unidentified driver. If a claimant is unable to establish fault on the part of the uninsured motorist, in addition to damages and causation, they'll be out of luck when it comes to getting additional coverage.
1 Phillip Fleissner & Paul Campbell III, Tennessee Automobile Liability Ins., §§ 15:1 Damages for Bodily Injury and 17:1 Uninsured Motorist Litigation procedures, Existence and Amount of Legal Liability (2010).
2 T.C.A §§ 56-7-1201(a) and 1202(a)(1); Collazo v. Haas, 2011 WL 6351865 at *5 (Tenn. Ct. App. 2011).
4 Webb v. Werner, 163 S.W.3d 716, 718 (Tenn. Ct. App. 2004) (where plaintiff allowed claim to lapse against the tortfeasor and, as such, it also lapsed as against the insurance company) (citing Winters v. Estate of Jones, 932 S.W.2d 464, 465-66 (Tenn. Ct. App. 1996).
5 Gafford v. Caruthers, 1994 WL 420917 (Tenn. Ct. App. 1994).
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