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Hanover Ins. Co. v. Horace Mann Ins. Co.

Supreme Court of South Carolina
Feb 20, 1990
301 S.C. 55 (S.C. 1990)

Summary

In Hanover Ins. Co. v. Horace Mann Ins. Co., 301 S.C. 55, 389 S.E.2d 657 (1990), the South Carolina Supreme Court shed a little more light on what constituted an effective offer of underinsured motorist coverage.

Summary of this case from Holt v. State Farm Mut. Auto. Ins. Co.

Opinion

23160

Heard January 9, 1990.

Decided February 20, 1990.

James D. Brice, of Rainey, Britton, Gibbes Clarkson, P.A., Greenville, for petitioner.

Stephen K. Haigler and Floyd Matlock Elliott, both of Haynsworth, Marion, McKay Guerard, Greenville, for defendants.

G. Dewey Oxner, Jr., of Haynsworth, Marion, McKay Guerard, Greenville, for respondent.


Heard Jan. 9, 1990.

Decided Feb. 20, 1990.


This case is before us on a writ of certiorari to review the memorandum decision of the Court of Appeals holding. The trial judge erred in granting petitioner's (Hanover's) motion for directed verdict. We reverse.

Kelley Parker, a passenger in a car owned by Daniel Loftis, sustained injuries when Loftis's car was struck by an underinsured motorist. Loftis was insured by respondent (Horace Mann) and had no underinsured motorist coverage. Parker was insured by Hanover and her policy included underinsured motorist coverage. Hanover brought this action to determine whether Loftis's policy with Horace Mann should be construed to provide primary underinsured motorist coverage for the benefit of Kelley Parker in the amount of Loftis's liability limits.

The trial judge granted Hanover's motion for directed verdict on the ground Horace Mann failed to make an effective offer of underinsured motorist coverage to Loftis and was therefore deemed to provide the contested coverage. The Court of Appeals reversed finding the sufficiency of Horace Mann's offer was a jury issue.

The trial judge specifically declined to rule on the issue whether Horace Mann's coverage was primary and this issue is not before us.

The only issue before us is whether Horace Mann's offer was insufficient as a matter of law. It is undisputed that if Horace Mann's agent offered the coverage, the offer was to purchase coverage only in an amount equal to Loftis's liability limits. Horace Mann's agent testified that if an insured requested coverage in an amount less than his liability coverage, the agency would not issue a policy.

S.C. Code Ann. § 38-77-160 (1989) provides that an automobile insurance carrier must offer, at the option of the insured, underinsured motorist coverage "up to the limits of the insured liability coverage." In Garris v. Cincinnati Insurance Co., 280 S.C. 149, 311 S.E.2d 723 (1984), this Court construed this statute to request an offer of underinsured motorist coverage "in any amount up to" the insured's liability coverage. We find the statutory language clear: had the legislature intended coverage only in an amount equal to the insured's liability limits, it would have specified coverage be offered "at" rather than "up to" that limit.

Formerly codified as § 56-9-831 (Supp. 1986).

Because Horace Mann failed to make an effective offer that correctly specified operational coverage limits, its policy with Loftis is deemed reformed by operation of law to include underinsured motorist coverage at the limits of Loftis's liability coverage. State Farm Mutual Automobile Insurance Co. v. Wannamaker, 291 S.C. 518, 354 S.E.2d 555 (1987); Davis v. State Budget and Control Board, 298 S.C. 135, 378 S.E.2d 604 (Ct.App. 1989). Horace Mann contends it is inequitable to reform the contract to provide underinsured motorist coverage at the policy liability limits because it was precisely this amount of optional coverage the insured refused. We reject this argument. Even assuming the offer was made and refused, a noncomplying offer has the legal effect of no offer at all.

Accordingly, the decision of the Court of Appeals is

Reversed.

HARWELL, CHANDLER, FINNEY and TOAL, JJ., concur.


Summaries of

Hanover Ins. Co. v. Horace Mann Ins. Co.

Supreme Court of South Carolina
Feb 20, 1990
301 S.C. 55 (S.C. 1990)

In Hanover Ins. Co. v. Horace Mann Ins. Co., 301 S.C. 55, 389 S.E.2d 657 (1990), the South Carolina Supreme Court shed a little more light on what constituted an effective offer of underinsured motorist coverage.

Summary of this case from Holt v. State Farm Mut. Auto. Ins. Co.

In Hanover, the offer was held to be ineffective because it was made only for the amount of the insured's liability coverage.

Summary of this case from Holt v. State Farm Mut. Auto. Ins. Co.

In Hanover Ins. Co. v. Horace Mann Ins. Co., 301 S.C. 55, 56, 389 S.E.2d 657, 658 (1990), this Court interpreted section 38-77-160 "to require an offer of underinsured motorist coverage `in any amount up to' the insured's liability coverage.

Summary of this case from Butler v. Unisun Insurance Co.

stating the appeal was heard January 9, 1990

Summary of this case from Cohen v. Progressive N. Ins. Co.
Case details for

Hanover Ins. Co. v. Horace Mann Ins. Co.

Case Details

Full title:HANOVER INSURANCE COMPANY, Petitioner, v. HORACE MANN INSURANCE COMPANY…

Court:Supreme Court of South Carolina

Date published: Feb 20, 1990

Citations

301 S.C. 55 (S.C. 1990)
389 S.E.2d 657

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