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As Reported by House Civil and Commercial Law Committee
123rd General Assembly
Regular Session
1999-2000 | Sub. S. B. No. 267 |
SENATORS RAY-HOTTINGER-NEIN-DiDONATO-SPADA-DRAKE-
REPRESENTATIVES SALERNO-CALLENDER
A BILL
To amend sections 3937.18 and 3937.31 of the Revised Code relative to an
insured's recovery under uninsured and underinsured motorist
coverage regarding wrongful death and other actions, coverages under renewal,
new, or replacement policies, modification of the terms of a policy at the
beginning
of a policy period, and exclusions from the definitions of "uninsured motor
vehicle" and "underinsured motor vehicle."
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
Section 1. That sections 3937.18 and 3937.31 of the Revised Code be amended to
read as follows:
Sec. 3937.18. (A) No automobile liability or motor
vehicle liability policy of insurance insuring against loss
resulting from liability imposed by law for bodily injury or
death suffered by any person arising out of the ownership,
maintenance, or use of a motor vehicle shall be delivered or
issued for delivery in this state with respect to any motor
vehicle registered or principally garaged in this state unless
both of the following coverages are offered to persons
insured
under the policy for loss due to bodily injury or death suffered
by such insureds:
(1) Uninsured motorist coverage, which shall be in an
amount of coverage equivalent to the automobile liability or
motor vehicle liability coverage and shall provide protection for
bodily injury, sickness, or disease, including
death under provisions approved by the
superintendent of insurance, for the protection of insureds thereunder
who are legally entitled to recover
damages
from owners or operators of uninsured motor vehicles because of
bodily injury, sickness, or disease, including death, suffered by
any person insured under the policy.
For purposes of division (A)(1) of this section, an
insured
is legally entitled to recover damages if the insured is able
to prove the
elements of the insured's claim that are necessary to
recover damages from
the owner or operator of the uninsured motor vehicle. The fact
that the owner or operator of the uninsured motor vehicle has an
immunity under
Chapter 2744. of the Revised Code or a diplomatic immunity that could be
raised
as a defense in an action
brought against the
owner or operator by
the insured does not
affect the insured's right to recover under
uninsured
motorist coverage.
However, any other type of statutory or common law immunity that may be a
defense for the owner or operator of an uninsured motor vehicle shall also be
a
defense to an action brought by the insured to recover under uninsured
motorist
coverage.
(2) Underinsured motorist coverage, which shall be in an
amount of coverage equivalent to the automobile liability or
motor vehicle liability coverage and shall provide protection for
insureds thereunder against loss for bodily injury,
sickness, or disease,
including death, suffered by any person insured under the policy,
where the limits of coverage available for payment to the insured
under all bodily injury liability bonds and insurance policies
covering persons liable to the insured are less than the limits
for the insured's uninsured motorist coverage. Underinsured
motorist coverage is not and shall not be excess insurance to
other applicable liability coverages, and shall be provided only
to afford the insured an amount of protection not greater than
that which would be available under the insured's uninsured
motorist coverage if the person or persons liable were uninsured
at the time of the accident. The policy limits of the
underinsured motorist coverage shall be reduced by those amounts
available for payment under all applicable bodily injury
liability bonds and insurance policies covering persons liable to
the insured.
(B) Coverages offered under division (A) of this section
shall be written for the same limits of liability. No change
shall be made in the limits of one of these coverages without an
equivalent change in the limits of the other coverage.
(C) A named insured or applicant may reject or
accept
both
coverages as offered under division (A) of this section, or
may
alternatively select both such coverages in accordance with a schedule of
limits approved by the superintendent.
The schedule of limits approved by the superintendent
may permit a named insured or applicant to select uninsured and
underinsured motorists coverages with limits on such coverages
that are less than the limit of liability coverage provided by
the automobile liability or motor vehicle liability policy of
insurance under which the coverages are provided, but the limits
shall be no less
than the limits set forth in section 4509.20 of the Revised Code
for bodily injury or death.
A named insured's or applicant's rejection of both coverages as
offered under division (A) of this section, or a named
insured's or applicant's selection of such coverages in
accordance with the schedule of limits approved by the
superintendent, shall be in writing and shall be signed by the
named insured or applicant. A named insured's or applicant's
written, signed rejection of both coverages as offered under
division (A) of this section, or a named insured's or
applicant's written, signed selection of such coverages in accordance with the
schedule of limits approved by the superintendent, shall be
effective on the day signed, shall create a presumption of an offer of
coverages consistent with division (A) of this section,
and shall be binding on all other named insureds, insureds, or
applicants.
Unless a named insured or applicant requests
such coverages in writing, such coverages need not be provided in
or made supplemental to a policy renewal or A NEW OR replacement
policy THAT PROVIDES CONTINUING COVERAGE TO THE NAMED INSURED OR
APPLICANT where a named insured or applicant has
rejected such coverages in connection with a policy
previously
issued to the named insured or applicant by the same
insurer OR AFFILIATE OF THAT INSURER. If a named insured or applicant
has selected
such coverages in connection with a policy
previously issued to the named insured or applicant by the
same insurer OR AFFILIATE OF THAT INSURER, with limits in accordance
with the schedule of limits
approved by the superintendent, such coverages
need not be provided
with limits in excess of the limits of liability previously
issued
for
such coverages, unless a
named insured or
applicant requests in
writing higher limits of liability for such coverages.
(D) For the purpose of this section, a motor vehicle
shall be deemed uninsured in either of the following
circumstances:
(1) The liability insurer denies coverage or is or
becomes the subject of insolvency proceedings in any
jurisdiction;
(2) The identity of the owner and operator of the motor vehicle
cannot be determined, but independent corroborative evidence exists to prove
that the bodily injury, sickness, disease, or death of the insured was
proximately caused by the negligence or intentional actions of
the unidentified operator of the motor vehicle. For purposes of
this division, the testimony of any insured seeking recovery
from the insurer shall not constitute independent corroborative
evidence, unless the testimony is supported by additional
evidence.
(E) In the event of payment to any person under the
coverages offered under this section and subject to
the
terms and
conditions of such coverages, the insurer making such payment to
the extent thereof is entitled to the proceeds of any settlement
or judgment resulting from the exercise of any rights of recovery
of such person against any person or organization legally
responsible for the bodily injury or death for which such payment
is made, including any amount recoverable from an insurer which
is or becomes the subject of insolvency proceedings, through such
proceedings or in any other lawful manner. No insurer shall
attempt to recover any amount against the insured of an insurer
which is or becomes the subject of insolvency proceedings, to the
extent of those rights against such insurer which such insured
assigns to the paying insurer.
(F) The coverages offered under this section shall
not be
made subject to an exclusion or reduction in amount because of
any workers' compensation benefits payable as a result of the
same injury or death.
(G) Any automobile liability or motor vehicle liability
policy of insurance that includes coverages offered under
division (A) of this section
or selected in accordance with division (C) of this section
may, without regard to any premiums
involved, include terms and conditions that preclude any and all
stacking of such coverages, including but not limited to:
(1) Interfamily stacking, which is the aggregating of the
limits of such coverages by the same person or two or more
persons, whether family members or not, who are not members of
the same household;
(2) Intrafamily stacking, which is the aggregating of the
limits of such coverages purchased by the same person or two or
more family members of the same household.
(H) Any automobile liability or motor vehicle liability
policy of insurance that includes coverages offered under
division (A) of this section
or selected in accordance with division (C) of this section
and that provides a limit of
coverage for payment for damages for bodily injury, including
death, sustained by any one person in any one automobile
accident, may, notwithstanding Chapter 2125. of the Revised Code,
include terms and conditions to the effect that all claims
resulting from or arising out of any one person's bodily injury,
including death, shall collectively be subject to the limit of
the policy applicable to bodily injury, including death,
sustained by one person, and, for the purpose of such policy
limit shall constitute a single claim. Any such policy limit
shall be enforceable regardless of the number of insureds, claims
made, vehicles or premiums shown in the declarations or policy,
or vehicles involved in the accident.
(I) Nothing in this section shall prohibit the inclusion
of underinsured motorist coverage in any uninsured motorist
coverage provided in compliance with this section.
(J) The coverages offered under division (A) of this
section or selected in accordance with division (C) of this section
may include terms and conditions that preclude coverage for bodily injury or
death suffered by an insured under any of the following circumstances:
(1) While the insured is operating or occupying a motor vehicle owned by,
furnished to, or available for the regular use of
a named insured, a
spouse, or a resident relative of a named insured, if the motor vehicle is not
specifically identified in the policy under which a claim is made, or is not a
newly acquired or
replacement motor vehicle covered under the terms of the policy under which
the uninsured and underinsured motorist coverages are provided;
(2) While the insured is operating or occupying a motor vehicle without a
reasonable belief that the insured is entitled to do so, provided that under
no circumstances will an insured whose license has been suspended, revoked, or
never issued, be held to have a reasonable belief that the insured is entitled
to operate a motor vehicle;
(3) When the bodily injury or death is caused by a motor
vehicle operated by any person who is specifically excluded from
coverage for bodily injury liability in the policy under which
the uninsured and underinsured motorist coverages are provided.
(K) As used in this section, "uninsured motor vehicle" and
"underinsured motor vehicle" do not
include any of the following motor vehicles:
(1) A motor vehicle that has applicable
liability coverage in the
policy under which the uninsured and underinsured motorist coverages are
provided;
(2) A motor vehicle owned by, furnished to, or available for the
regular use of a named insured, a spouse, or a resident relative of a named
insured;
(3) A motor vehicle owned by a political subdivision, unless the
operator of the motor vehicle has an immunity
under Chapter 2744. of the Revised Code that could
be raised as a defense in an action brought against the operator
by the insured;
(4)(3) A motor vehicle self-insured within the meaning of the
financial
responsibility law of the state in which the motor vehicle is registered.
(L) As used in this section, "automobile liability or motor
vehicle liability policy of insurance" means either of the following:
(1) Any policy of insurance that serves as proof of financial
responsibility, as proof of financial responsibility is defined by division
(K) of section 4509.01 of the Revised Code, for owners or operators of the
motor
vehicles specifically identified in the policy of insurance;
(2) Any umbrella liability policy of insurance written as excess over one
or more policies described in division (L)(1) of this section.
Sec. 3937.31. (A) Every automobile insurance policy shall
be issued for a policy period of not less than two years or
guaranteed renewable for successive policy periods totaling not
less than two years. Where renewal is mandatory, "cancellation,"
as used in sections 3937.30 to 3937.39 of the Revised Code,
includes refusal to renew a policy with at least the coverages,
included insureds, and policy limits provided at the end of the
next preceding policy period. No insurer may cancel any such
policy except pursuant to the terms of the policy, and in
accordance with sections 3937.30 to 3937.39 of the Revised Code,
and for one or more of the following reasons:
(1) Misrepresentation by the insured to the insurer of any
material fact in the procurement or renewal of the insurance or
in the submission of claims thereunder;
(2) Loss of driving privileges through suspension,
revocation, or expiration of the driver's or commercial driver's
license of the named insured or any member of his THE NAMED
INSURED'S family covered
as a driver; provided that the insurer shall continue the policy
in effect but exclude by endorsement all coverage as to the
person whose driver's license has been suspended or revoked or
has expired, if he THE PERSON is other than the named insured or
the
principal operator;
(3) Nonpayment of premium, which means failure of the
named insured to discharge when due any of his THE NAMED
INSURED'S obligations in
connection with the payment of premiums on a policy, or any
installment of such premiums, whether the premium is payable
directly to the insurer or its agent or indirectly under any
premium finance plan or extension of credit;
(4) The place of residence of the insured or the state of
registration or license of the insured automobile is changed to a
state or country in which the insurer is not authorized to write
automobile coverage.
This section does not apply in the case of a cancellation
if the insurer has indicated its willingness to issue a new
policy within the same insurer or within another insurer under
the same ownership or management as that of the insurer which
THAT has
issued the cancellation.
(B) Sections 3937.30 to 3937.39 of the Revised Code do not
prohibit:
(1) Changes in coverage or policy limits, cancellation, or
nonrenewal for any reason at the request or with the consent of
the insured;
(2) Lawful surcharges, adjustments, or other changes in
premium;
(3) Policy modification to all policies issued to a
classification of risk which do not effect a withdrawal or
reduction in the initial coverage or policy limits;
(4) An insurer's refusing for any reason to renew a policy
upon its expiration at the end of any mandatory period, provided
such nonrenewal complies with the procedure set forth in section
3937.34 of the Revised Code.
(C) Sections 3937.30 to 3937.39 of the Revised Code do not
apply to any policy or coverage which THAT has been in
effect less
than ninety days at the time notice of cancellation is mailed by
the insurer, unless it is a renewal policy.
(D) Renewal of a policy does not constitute a waiver or
estoppel with respect to grounds for cancellation which
THAT existed
before the effective date of such renewal.
(E) NOTHING IN THIS SECTION PROHIBITS AN INSURER FROM
INCORPORATING INTO A POLICY ANY CHANGES THAT ARE PERMITTED OR REQUIRED BY
THIS SECTION OR OTHER SECTIONS of the Revised Code AT THE BEGINNING OF ANY POLICY PERIOD
WITHIN THE TWO-YEAR PERIOD SET FORTH IN DIVISION
(A) OF THIS SECTION.
Section 2. That existing sections 3937.18 and 3937.31 of the Revised Code are
hereby repealed.
Section 3. It is the intent of the General Assembly in amending
division (A) of section 3937.18 of the Revised Code to supersede
the holdings of the Ohio Supreme Court in Sexton v.
State Farm
Mut. Auto. Ins. Co. (1982), 69 Ohio St.2d
431, and Moore v.
State Auto. Mut. Ins. Co. (2000),
88 Ohio St.3d 27, that
division (A)(1) of section 3937.18 of the Revised Code does not permit an
insurer to limit uninsured or underinsured motorist coverage in such a way
that an insured must suffer bodily injury, sickness, death or disease for any
other insured to recover from the insurer.
Section 4. It is the intent of the General Assembly in amending
division (C) of section 3937.18 of the Revised Code to make it
clear that new rejections of uninsured and underinsured motorist
coverages or decisions to accept lower limits of coverages need
not be obtained from an insured or applicant at the beginning of each
policy period in which the policy provides continuing coverage to the named
insured or applicant, regardless of whether a new, replacement, or renewal
policy that provides continuing coverage to the named insured or applicant is
issued by the insurer or affiliate of that insurer with or without new policy
terms or new policy numbers.
Section 5. It is the intent of the General Assembly in amending
section 3937.31 of the Revised Code to make it clear that an
insurer may modify the terms and conditions of any automobile
insurance policy to incorporate changes that are permitted or
required by that section and other sections of the Revised Code at the
beginning of any
policy period within the two-year period set forth in division (A) of
that section.
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