As Reported by House Civil and Commercial Law Committee 1
123rd General Assembly 4
Regular Session Sub. S. B. No. 267 5
1999-2000 6
SENATORS RAY-HOTTINGER-NEIN-DiDONATO-SPADA-DRAKE- 9
REPRESENTATIVES SALERNO-CALLENDER
_________________________________________________________________ 10
A B I L L
To amend sections 3937.18 and 3937.31 of the Revised 12
Code relative to an insured's recovery under 13
uninsured and underinsured motorist coverage 14
regarding wrongful death and other actions,
coverages under renewal, new, or replacement 15
policies, modification of the terms of a policy
at the beginning of a policy period, and 17
exclusions from the definitions of "uninsured
motor vehicle" and "underinsured motor vehicle." 18
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO: 20
Section 1. That sections 3937.18 and 3937.31 of the 22
Revised Code be amended to read as follows: 23
Sec. 3937.18. (A) No automobile liability or motor 32
vehicle liability policy of insurance insuring against loss 33
resulting from liability imposed by law for bodily injury or 34
death suffered by any person arising out of the ownership, 35
maintenance, or use of a motor vehicle shall be delivered or 36
issued for delivery in this state with respect to any motor 37
vehicle registered or principally garaged in this state unless 38
both of the following coverages are offered to persons insured 40
under the policy for loss due to bodily injury or death suffered 41
by such insureds: 42
(1) Uninsured motorist coverage, which shall be in an 44
amount of coverage equivalent to the automobile liability or 45
motor vehicle liability coverage and shall provide protection for 46
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bodily injury, sickness, or disease, including death under 48
provisions approved by the superintendent of insurance, for the 49
protection of insureds thereunder who are legally entitled to 50
recover damages from owners or operators of uninsured motor 52
vehicles because of bodily injury, sickness, or disease, 53
including death, suffered by any person insured under the policy. 54
For purposes of division (A)(1) of this section, an insured 57
is legally entitled to recover damages if the insured is able to 59
prove the elements of the insured's claim that are necessary to 60
recover damages from the owner or operator of the uninsured motor 62
vehicle. The fact that the owner or operator of the uninsured 63
motor vehicle has an immunity under Chapter 2744. of the Revised 65
Code or a diplomatic immunity that could be raised as a defense 67
in an action brought against the owner or operator by the insured 70
does not affect the insured's right to recover under uninsured 72
motorist coverage. However, any other type of statutory or 74
common law immunity that may be a defense for the owner or 75
operator of an uninsured motor vehicle shall also be a defense to 77
an action brought by the insured to recover under uninsured
motorist coverage. 79
(2) Underinsured motorist coverage, which shall be in an 81
amount of coverage equivalent to the automobile liability or 82
motor vehicle liability coverage and shall provide protection for 83
insureds thereunder against loss for bodily injury, sickness, or 85
disease, including death, suffered by any person insured under 86
the policy, where the limits of coverage available for payment to 87
the insured under all bodily injury liability bonds and insurance 88
policies covering persons liable to the insured are less than the 89
limits for the insured's uninsured motorist coverage. 90
Underinsured motorist coverage is not and shall not be excess 91
insurance to other applicable liability coverages, and shall be 92
provided only to afford the insured an amount of protection not 93
greater than that which would be available under the insured's 94
uninsured motorist coverage if the person or persons liable were 95
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uninsured at the time of the accident. The policy limits of the 96
underinsured motorist coverage shall be reduced by those amounts 97
available for payment under all applicable bodily injury 98
liability bonds and insurance policies covering persons liable to 99
the insured. 100
(B) Coverages offered under division (A) of this section 102
shall be written for the same limits of liability. No change 103
shall be made in the limits of one of these coverages without an 104
equivalent change in the limits of the other coverage. 105
(C) A named insured or applicant may reject or accept both 109
coverages as offered under division (A) of this section, or may 111
alternatively select both such coverages in accordance with a 112
schedule of limits approved by the superintendent. The schedule 114
of limits approved by the superintendent may permit a named 115
insured or applicant to select uninsured and underinsured 116
motorists coverages with limits on such coverages that are less 117
than the limit of liability coverage provided by the automobile 118
liability or motor vehicle liability policy of insurance under 119
which the coverages are provided, but the limits shall be no less 120
than the limits set forth in section 4509.20 of the Revised Code 121
for bodily injury or death. A named insured's or applicant's 123
rejection of both coverages as offered under division (A) of this 124
section, or a named insured's or applicant's selection of such 125
coverages in accordance with the schedule of limits approved by 126
the superintendent, shall be in writing and shall be signed by 127
the named insured or applicant. A named insured's or applicant's 128
written, signed rejection of both coverages as offered under 129
division (A) of this section, or a named insured's or applicant's 131
written, signed selection of such coverages in accordance with
the schedule of limits approved by the superintendent, shall be 132
effective on the day signed, shall create a presumption of an 133
offer of coverages consistent with division (A) of this section, 134
and shall be binding on all other named insureds, insureds, or 135
applicants. 136
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Unless a named insured or applicant requests such coverages 139
in writing, such coverages need not be provided in or made 140
supplemental to a policy renewal or A NEW OR replacement policy 141
THAT PROVIDES CONTINUING COVERAGE TO THE NAMED INSURED OR
APPLICANT where a named insured or applicant has rejected such 143
coverages in connection with a policy previously issued to the 145
named insured or applicant by the same insurer OR AFFILIATE OF 146
THAT INSURER. If a named insured or applicant has selected such 148
coverages in connection with a policy previously issued to the 149
named insured or applicant by the same insurer OR AFFILIATE OF 150
THAT INSURER, with limits in accordance with the schedule of 151
limits approved by the superintendent, such coverages need not be 153
provided with limits in excess of the limits of liability 154
previously issued for such coverages, unless a named insured or 158
applicant requests in writing higher limits of liability for such 160
coverages.
(D) For the purpose of this section, a motor vehicle shall 163
be deemed uninsured in either of the following circumstances: 164
(1) The liability insurer denies coverage or is or becomes 167
the subject of insolvency proceedings in any jurisdiction; 168
(2) The identity of the owner and operator of the motor 170
vehicle cannot be determined, but independent corroborative 171
evidence exists to prove that the bodily injury, sickness, 172
disease, or death of the insured was proximately caused by the 173
negligence or intentional actions of the unidentified operator of 174
the motor vehicle. For purposes of this division, the testimony 175
of any insured seeking recovery from the insurer shall not 176
constitute independent corroborative evidence, unless the 177
testimony is supported by additional evidence. 178
(E) In the event of payment to any person under the 180
coverages offered under this section and subject to the terms and 183
conditions of such coverages, the insurer making such payment to 184
the extent thereof is entitled to the proceeds of any settlement 185
or judgment resulting from the exercise of any rights of recovery 186
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of such person against any person or organization legally 187
responsible for the bodily injury or death for which such payment 188
is made, including any amount recoverable from an insurer which 189
is or becomes the subject of insolvency proceedings, through such 190
proceedings or in any other lawful manner. No insurer shall 191
attempt to recover any amount against the insured of an insurer 192
which is or becomes the subject of insolvency proceedings, to the 193
extent of those rights against such insurer which such insured 194
assigns to the paying insurer. 195
(F) The coverages offered under this section shall not be 198
made subject to an exclusion or reduction in amount because of 199
any workers' compensation benefits payable as a result of the 200
same injury or death. 201
(G) Any automobile liability or motor vehicle liability 203
policy of insurance that includes coverages offered under 204
division (A) of this section or selected in accordance with 206
division (C) of this section may, without regard to any premiums 207
involved, include terms and conditions that preclude any and all 208
stacking of such coverages, including but not limited to: 209
(1) Interfamily stacking, which is the aggregating of the 211
limits of such coverages by the same person or two or more 212
persons, whether family members or not, who are not members of 213
the same household; 214
(2) Intrafamily stacking, which is the aggregating of the 216
limits of such coverages purchased by the same person or two or 217
more family members of the same household. 218
(H) Any automobile liability or motor vehicle liability 220
policy of insurance that includes coverages offered under 221
division (A) of this section or selected in accordance with 223
division (C) of this section and that provides a limit of 224
coverage for payment for damages for bodily injury, including 225
death, sustained by any one person in any one automobile 226
accident, may, notwithstanding Chapter 2125. of the Revised Code, 227
include terms and conditions to the effect that all claims 228
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resulting from or arising out of any one person's bodily injury, 229
including death, shall collectively be subject to the limit of 230
the policy applicable to bodily injury, including death, 231
sustained by one person, and, for the purpose of such policy 232
limit shall constitute a single claim. Any such policy limit 233
shall be enforceable regardless of the number of insureds, claims 234
made, vehicles or premiums shown in the declarations or policy, 235
or vehicles involved in the accident. 236
(I) Nothing in this section shall prohibit the inclusion 238
of underinsured motorist coverage in any uninsured motorist 239
coverage provided in compliance with this section. 240
(J) The coverages offered under division (A) of this 242
section or selected in accordance with division (C) of this 243
section may include terms and conditions that preclude coverage 244
for bodily injury or death suffered by an insured under any of 245
the following circumstances:
(1) While the insured is operating or occupying a motor 247
vehicle owned by, furnished to, or available for the regular use 248
of a named insured, a spouse, or a resident relative of a named 250
insured, if the motor vehicle is not specifically identified in 251
the policy under which a claim is made, or is not a newly 252
acquired or replacement motor vehicle covered under the terms of 253
the policy under which the uninsured and underinsured motorist 254
coverages are provided;
(2) While the insured is operating or occupying a motor 256
vehicle without a reasonable belief that the insured is entitled 257
to do so, provided that under no circumstances will an insured 258
whose license has been suspended, revoked, or never issued, be 259
held to have a reasonable belief that the insured is entitled to 260
operate a motor vehicle;
(3) When the bodily injury or death is caused by a motor 262
vehicle operated by any person who is specifically excluded from 263
coverage for bodily injury liability in the policy under which 264
the uninsured and underinsured motorist coverages are provided. 265
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(K) As used in this section, "uninsured motor vehicle" and 267
"underinsured motor vehicle" do not include any of the following 269
motor vehicles:
(1) A motor vehicle that has applicable liability coverage 272
in the policy under which the uninsured and underinsured motorist 273
coverages are provided; 274
(2) A motor vehicle owned by, furnished to, or available 276
for the regular use of a named insured, a spouse, or a resident 277
relative of a named insured; 278
(3) A motor vehicle owned by a political subdivision, 280
unless the operator of the motor vehicle has an immunity under 282
Chapter 2744. of the Revised Code that could be raised as a 283
defense in an action brought against the operator by the insured; 284
(4)(3) A motor vehicle self-insured within the meaning of 286
the financial responsibility law of the state in which the motor 288
vehicle is registered.
(L) As used in this section, "automobile liability or 290
motor vehicle liability policy of insurance" means either of the 291
following:
(1) Any policy of insurance that serves as proof of 293
financial responsibility, as proof of financial responsibility is 294
defined by division (K) of section 4509.01 of the Revised Code, 295
for owners or operators of the motor vehicles specifically 297
identified in the policy of insurance;
(2) Any umbrella liability policy of insurance written as 299
excess over one or more policies described in division (L)(1) of 300
this section.
Sec. 3937.31. (A) Every automobile insurance policy shall 309
be issued for a policy period of not less than two years or 310
guaranteed renewable for successive policy periods totaling not 311
less than two years. Where renewal is mandatory, "cancellation," 312
as used in sections 3937.30 to 3937.39 of the Revised Code, 313
includes refusal to renew a policy with at least the coverages, 314
included insureds, and policy limits provided at the end of the 315
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next preceding policy period. No insurer may cancel any such 316
policy except pursuant to the terms of the policy, and in 317
accordance with sections 3937.30 to 3937.39 of the Revised Code, 318
and for one or more of the following reasons: 319
(1) Misrepresentation by the insured to the insurer of any 321
material fact in the procurement or renewal of the insurance or 322
in the submission of claims thereunder; 323
(2) Loss of driving privileges through suspension, 325
revocation, or expiration of the driver's or commercial driver's 326
license of the named insured or any member of his THE NAMED 327
INSURED'S family covered as a driver; provided that the insurer 329
shall continue the policy in effect but exclude by endorsement 330
all coverage as to the person whose driver's license has been 331
suspended or revoked or has expired, if he THE PERSON is other 332
than the named insured or the principal operator; 334
(3) Nonpayment of premium, which means failure of the 336
named insured to discharge when due any of his THE NAMED 337
INSURED'S obligations in connection with the payment of premiums 339
on a policy, or any installment of such premiums, whether the 340
premium is payable directly to the insurer or its agent or 341
indirectly under any premium finance plan or extension of credit; 342
(4) The place of residence of the insured or the state of 344
registration or license of the insured automobile is changed to a 345
state or country in which the insurer is not authorized to write 346
automobile coverage. 347
This section does not apply in the case of a cancellation 349
if the insurer has indicated its willingness to issue a new 350
policy within the same insurer or within another insurer under 351
the same ownership or management as that of the insurer which 352
THAT has issued the cancellation. 354
(B) Sections 3937.30 to 3937.39 of the Revised Code do not 356
prohibit: 357
(1) Changes in coverage or policy limits, cancellation, or 359
nonrenewal for any reason at the request or with the consent of 360
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the insured; 361
(2) Lawful surcharges, adjustments, or other changes in 363
premium; 364
(3) Policy modification to all policies issued to a 366
classification of risk which do not effect a withdrawal or 367
reduction in the initial coverage or policy limits; 368
(4) An insurer's refusing for any reason to renew a policy 370
upon its expiration at the end of any mandatory period, provided 371
such nonrenewal complies with the procedure set forth in section 372
3937.34 of the Revised Code. 373
(C) Sections 3937.30 to 3937.39 of the Revised Code do not 375
apply to any policy or coverage which THAT has been in effect 377
less than ninety days at the time notice of cancellation is 378
mailed by the insurer, unless it is a renewal policy. 379
(D) Renewal of a policy does not constitute a waiver or 381
estoppel with respect to grounds for cancellation which THAT 383
existed before the effective date of such renewal. 384
(E) NOTHING IN THIS SECTION PROHIBITS AN INSURER FROM 386
INCORPORATING INTO A POLICY ANY CHANGES THAT ARE PERMITTED OR 387
REQUIRED BY THIS SECTION OR OTHER SECTIONS OF THE REVISED CODE AT 388
THE BEGINNING OF ANY POLICY PERIOD WITHIN THE TWO-YEAR PERIOD SET 389
FORTH IN DIVISION (A) OF THIS SECTION. 390
Section 2. That existing sections 3937.18 and 3937.31 of 392
the Revised Code are hereby repealed. 393
Section 3. It is the intent of the General Assembly in 395
amending division (A) of section 3937.18 of the Revised Code to 396
supersede the holdings of the Ohio Supreme Court in Sexton v. 397
State Farm Mut. Auto. Ins. Co. (1982), 69 Ohio St.2d 431, and 400
Moore v. State Auto. Mut. Ins. Co. (2000), 88 Ohio St.3d 27, that 402
division (A)(1) of section 3937.18 of the Revised Code does not 403
permit an insurer to limit uninsured or underinsured motorist 404
coverage in such a way that an insured must suffer bodily injury, 405
sickness, death or disease for any other insured to recover from 406
the insurer.
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Section 4. It is the intent of the General Assembly in 408
amending division (C) of section 3937.18 of the Revised Code to 409
make it clear that new rejections of uninsured and underinsured 410
motorist coverages or decisions to accept lower limits of 411
coverages need not be obtained from an insured or applicant at 412
the beginning of each policy period in which the policy provides 413
continuing coverage to the named insured or applicant, regardless 414
of whether a new, replacement, or renewal policy that provides 415
continuing coverage to the named insured or applicant is issued 416
by the insurer or affiliate of that insurer with or without new
policy terms or new policy numbers. 417
Section 5. It is the intent of the General Assembly in 419
amending section 3937.31 of the Revised Code to make it clear 420
that an insurer may modify the terms and conditions of any 421
automobile insurance policy to incorporate changes that are 422
permitted or required by that section and other sections of the 423
Revised Code at the beginning of any policy period within the 425
two-year period set forth in division (A) of that section. 426