Elliott v. GeicoAnnotate this Case
Christina Elliott appealed the dismissal of her lawsuit against Geico Indemnity Company (Geico). Elliott’s husband was killed when his motorcycle was struck by a truck driven by a drunk driver, Lesa Shaffer, who was returning to her job at Peterson’s Corner, a restaurant and bar in Nevada City. The trial court concluded Geico was not required to pay underinsured motorist benefits under a motorcycle insurance policy issued to Elliott and her husband because Elliott recovered more than the $100,000 underinsured motorist coverage limits in settlement of a wrongful death action brought against Shaffer and the owners of the restaurant (Shaffer’s insurer paid $15,000 and the owners’ general liability insurer paid $250,000). The Court of Appeal agreed with the trial court: the Geico policy at issue here unambiguously allowed Geico to deduct from the underinsured motorist coverage limits “the amount paid to the insured by or for any person or organization that may be held legally liable for the injury.” Because $265,000 was paid to Elliott in settlement of her claims that both Shaffer and the owners may be held legally liable for the injury, Geico properly deducted this amount from the underinsured motorist coverage limits.