Michigan Court of Appeals; Docket #297900; Unpublished
Judges Whitbeck, Markey, K.F. Kelly, Per Curiam
Official Michigan Reporter Citation: Not Applicable; Link to Opinion 
On December 28, 2011, the Michigan Supreme Court DENIED Leave to Appeal; Link to Order
STATUTORY INDEXING:
Liability Exclusions for Family Member Claims [3131]
TOPICAL INDEXING:
Not Applicable
CASE SUMMARY:
In this unanimous unpublished per curiam opinion, the Court of Appeals affirmed the trial court determination that an exclusion clause in the liability portion of a no-fault automobile insurance contract was not ambiguous and therefore was enforceable so as to “step down” the $100,000.00 limits of coverage to the statutory minimum requirements of $20,000.00 per person and $40,000.00 per occurrence where the injury was to the insured or any family member.
Edwin Hollenbeck was involved in a motor vehicle accident in February 2008 when a truck, owned and insured by Edwin and being driven by his son who was under the influence of alcohol, went out of control and rolled over. As a consequence of the collision, Edwin sustained injuries resulting in permanent quadriplegia. Edwin’s wife was not directly injured but made claim for loss of consortium damages.
At the time of the accident, the truck was insured by Edwin under a policy with Farm Bureau. The declaration page of the policy provided bodily injury coverage for liability in the amount of $100,000.00 per person and $300,000.00 per occurrence. However, the policy contained an exclusion which limited the amount of liability coverage as follows:
“We do not provide liability coverage for any insured…for bodily injury to you [, the insured,] or to any family member that exceeds the minimum statutory limits of the financial responsibility law or any similar laws of the State of Michigan or any other state or province in which an otherwise covered auto accident occurs.”
The effect of the limitation on coverage was to reduce the stated limits on the declaration page from $100,000.00 to the statutory minimum of $20,000.00.
Plaintiff claimed in the trial court and on appeal that the provisions of this exclusion were ambiguous in that the exclusion clause which limited coverage to the statutory minimum does not comport with the declaration of coverage and a reasonable insured would not understand what the exclusion means without the policy expressly stating the applicable coverage limits. Plaintiffs also claimed that the exclusion violated public policy and that the insurance company had failed to give adequate notice of the change in coverage when the policy was last renewed. Plaintiff also claimed that Brenda Hollenbeck’s loss of consortium claim was not limited by the exclusion.
In affirming the trial court’s determinations in favor of Farm Bureau, the Court of Appeals held that the exclusion was not ambiguous. Even though the exclusion clause neither expressly states in monetary amounts what the statutory minimum is, nor gives any statutory citation, an insured is on notice that the coverage provided in the event that a bodily injury is suffered by the insured or his or her family member is the statutory minimum. The court further held that Farm Bureau did not violate its obligation to provide actual notice of any changes or reductions in the policy when the policy was renewed. The insurer did provide notice of the exclusion itself, and the failure to expressly indicate the dollar amount of the coverage limits didn’t cause that notice to be inadequate. The court also held that the exclusion did not violate public policy, this issue having been determined in Manier v. MIC Ins Corp, 281 Mich App 485 (2008).
Finally, the court held that Brenda Hollenbeck’s loss of consortium claim was also limited by the exclusion for the reason that a loss of consortium claim under a no-fault automobile insurance contract is not a claim for bodily injury but rather is derivative of a claim for bodily injury. Therefore, any claim for loss of consortium under the insurance contract is not a separate claim and is combined with the claim for bodily injury and therefore subject to the coverage limits contained in the exclusion.
