Allstate Insurance v. Mercury Insurance

Insurance code section 11580.2, subdivision (d), provides that an insurance policy may require that uninsured motorist (UM) coverage be prorated when an insured has coverage under more than one UM policy. 1 The section was designed to “avoid endless squabbles” engendered by claims made under multiple policies. (Wagner v. State Farm Mutual Auto. Ins. Co. (1985) 40 Cal.3d 460, 468 [ 220 Cal.Rptr. 659 , 709 P.2d 462 ].)

Here the section did not achieve its goal. Two insurance companies make cogent arguments concerning the meaning of clauses pertaining to UM coverage in their respective policies. We conclude the statute is clear. The policy with the proration provision takes preference over the policy with the excess coverage provision. Squabble over.

Allstate Insurance Company (Allstate), appeals a summary judgment in favor of Mercury Insurance Company (Mercury). We affirm.

FACTS AND PROCEDURAL HISTORY

This lawsuit concerns a dispute between two insurance companies regarding which of two competing clauses in their respective uninsured motorist insurance policies apply to compensate a passenger injured in an automobile collision with an uninsured motorist. Thus, Mercury’s…