Nationwide Mutual Insurance Co. v. ShillingAnnotate this Case
The Court of Appeals held that the statute of limitations begins to run in an underinsured motorist claim against an insurer when the insurer breaches the contract to provide underinsured motorist benefits by denying the insured's claim.
Insured was injured in an automobile accident with an underinsured motorist. The underinsured tortfeasor extended to Insured a policy limits settlement offer of $20,000. Insured accepted the offer and then attempted to collect additional underinsured motorist benefits from Insurer. The motor vehicle liability insurance policy covered up to $300,000 per person for bodily injury caused by an uninsured or underinsured motorist. Insured later filed suit against Insurer seeking the balance of unpaid damages not covered by the $20,000 settlement. The circuit court dismissed the complaint as untimely. The Court of Special Appeals reversed. The Court of Appeals affirmed, holding (1) the statute of limitations in an underinsured motorist claim begins to run when the insurer denies an insured's demand for benefits, thereby breaching the insurance contract; and (2) Insured's underinsured motorist claim was not time barred.