Justice v. Am. Family Ins. Co.Annotate this Case
An underinsured motorist collided with a city bus driven by Plaintiff. Plaintiff received a net workers’ compensation award of $71,958. Plaintiff also received $25,000 from the tortfeasor’s insurer. Plaintiff carried an underinsured (UM) policy issued by American Family Mutual Insurance Company that provided coverage up to $50,000 per person. Plaintiff submitted a UM claim to American Family, which denied coverage. Plaintiff filed a breach of contract action against American Family, asserting that he was entitled, under the terms of the policy, to $25,000 - the difference between his UM policy limit of $50,000 and the $25,000 he received from the tortfeasor’s insurer. The trial court granted summary judgment for American Family, concluding that the workers’ compensation benefits Plaintiff received operated as a setoff against the policy limit, thus reducing American Family’s liability to zero. The Supreme Court reversed, holding (1) the policy language unambiguously provided for a setoff against the policy limit; but (2) because this particular set-off would reduce the policy limit below the statutory minimum, Plaintiff was entitled to recover the remaining $25,000 from American Family.