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White v Lake State Insurance Company; (COA-UNP, 12/9/2003, RB #2421)


Michigan Court of Appeals; Docket No. 241026; Unpublished
Judges Murray, Gage, and Kelly; unanimous; per curiam
Official Michigan Reporter Citation: Not applicable, Link to Opinion alt

Not applicable

Social Security Disability and Death Benefits 
Underinsured Motorist Coverage: Setoffs Applicable to Underinsured Motorist Cases
Uninsured Motorist Benefits: Setoffs Applicable to Uninsured Motorist Cases

In this unanimous unpublished per curiam opinion, the Court of Appeals upheld the trial court determination that a setoff of social security benefits paid or payable against plaintiff’s claim for uninsured and underinsured motorist benefits was, although inartfully worded, enforceable.

In this case, plaintiff was injured in a multi-vehicle automobile accident involving both an uninsured and underinsured motorist. She suffered a head injury and was restricted from performing any work. She was found to be disabled and received social security disability benefits. She sought uninsured or underinsured benefits provided for in the no-fault automobile insurance policy. The policy provided for coverage limits of $100,000, and further provided that defendant was entitled to setoff the social security benefits paid or payable from the coverage limits. The trial court determined that since the social security benefits would exceed $100,000, plaintiff was not entitled to recover under the uninsured/underinsured coverage.

On appeal, plaintiff argued that the policy also contained an exclusion clause which stated:

“This coverage shall not apply directly or indirectly to benefit any insurer or self-insurer under any of the following or similar law:

1. Workers’ compensation; or

2. Disability benefits law.”

Plaintiff argued that the term “any insurer” in this exclusion clause must be read to include Lake State Insurance, and that this clause therefore precludes Lake State from taking the setoff for social security disability benefits, since this would benefit defendant under disability benefits law.

The Court of Appeals, in affirming the trial court, held that the exclusion relied on by plaintiff did not conflict with the limits of liability clause allowing for the setoff. The Court of Appeals held that it made no sense to argue that the “coverage” which defendant is required to pay, “shall not apply to benefit defendant.” For the coverage to benefit defendant under any law, defendant would have to be making a claim against itself. Since this construction of the policy makes no sense, the court held that plaintiff’s position must fail.

Michigan auto accident attorney Stephen Sinas is the lead editor of the appellate case summaries published on this site regarding the Michigan auto insurance law. To learn more about how Stephen Sinas and how the Sinas Dramis Law Firm can help you if you have been injured in a Michigan auto accident, visit

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