Diana L. Powell v. Penny D. Clark

IN THE COURT OF APPEALS OF TENNESSEE
AT NASHVILLE
December 02, 2014 Session

DIANA L. POWELL, ET AL. V. PENNY D. CLARK

Appeal from the Circuit Court for Rutherford County
No. 62933 Robert E. Corlew, III, Judge, sitting by interchange

No. M2014-01083-COA-R3-CV - Filed February 3, 2015

This appeal involves a limitation of liability in an insurance policy. A ppellant A lls ta te
Insurance Company seeks reduction of its uninsured motorist liability by amounts paid by
Appellee insured’s automobile insurance carrier. In light of the legislative intent that offsets
should be limited to monies received from legally responsible parties or entities, and the
limiting language used in the Allstate policy, we conclude that the trial court correctly denied
the offset in this case. Affirmed and remanded.

Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Circuit Court is
Affirmed and Remanded.

K ENNY A RMSTRONG, J., delivered the opinion of the Court, in which J. S TEVEN S TAFFORD,
P.J., W.S., and A RNOLD B. G OLDIN, J., joined.

Alan M. Sowell, Nashville, Tennessee, for the appellant, Allstate Insurance Company.

Michael D. Galligan and Susan N. Marttala, McMinnville, Tennessee, for the appellees,
Diana and Ronald Powell.

OPINION

I. Background

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The relevant facts in this case are not in dispute. On July 1, 2012, Diana Powell was riding
as a guest passenger in a vehicle driven by Patricia Collins. Ms. Collins’ vehicle was struck
by a vehicle that was driven by Penny Clark. There is no dispute that Ms. Clark was 100%
at fault for the collision. However, Ms. Clark never appeared in the case and was an
uninsured motorist at the time of the accident.

Ms. Powell was insured by State Farm. Her policy included uninsured motorist limits of
$100,000.00. Her policy also provided medical payments coverage in the amount of
$100,000.00. Patricia Collins was insured by Allstate Insurance Company (“Allstate,” or
“Appellant”). Her policy likewise provided an uninsured motorist coverage limit of
$100,000.00. However, Ms. Collins’ policy only provided for medical payments coverage
in the amount of $2,000.00.

There is no dispute that Allstate, rather than State Farm, is the primary carrier for uninsured
motorist coverage with respect to this accident. See Tenn. Code Ann. §56-7-1201(b)(3).1
Allstate paid Ms. Powell $2,000.00 under the medical portion of Ms. Collins’ policy.
Thereafter, State Farm, under its policy, paid medical payments in the amount of $70,021.32
on behalf of Ms. Powell.

Ms. Powell and her husband Ronald (together the “Powells,” or “Appellees”) filed suit
against Penny Clark on June 27, 2011. A summons was issued for State Farm as the
uninsured motorist carrier for the Powells. A summons was also issued for Allstate as the
uninsured motorist carrier for Ms. Collins. State Farm filed its answer on July 28, 2011.
Allstate filed its answer on August 1, 2011. As noted above, the named defendant, Ms.
Clark, never made an appearance. On September 2, 2011, an agreed order of dismissal was
entered as to State Farm.

On October 30, 2012, the Powells filed a motion for declaratory judgment, asking the trial
court to determine that Allstate was not entitled to offset the medical payments made by State
Farm against Allstate’s uninsured motorist limits. On December 3, 2012, the trial court

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Tennessee Code Annotated Section 56-7-1201(b)(3) provides:

(3) With respect to bodily injury to an insured while occupying an
automobile not owned by the insured, the following priorities of
recovery under uninsured motorist coverage apply:
(A) The uninsured motorist coverage on the vehicle in which the
insured was an occupant shall be the primary uninsured motorist
coverage;

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issued a memorandum opinion, in which it specifically held that “Allstate Insurance is not
allowed to setoff payments made by State Farm Mutual Insurance to or on behalf of the
Plaintiff for medical expenses for treatment of injuries the Plaintiff received in the accident
at issue.” In so holding, the trial court reasoned, in relevant part, as follows:

[T]he clear language of the Allstate policy. . . provides that
Allstate is entitled to a setoff for the $67,500 paid by State
Farm. The practical application of such a decision, however, is
far-reaching. First, because State Farm has the right of
subrogation under the terms of its policy, Allstate would
effectively be able to preclude any such recovery by State Farm.
Thus, by stepping up promptly to provide relief for its insured,
State Farm would be in the position of saving money for Allstate
while expend[ing] its own dollars which otherwise would have
been paid first by Allstate to the injured party, and then
potentially recouped by State Farm. Were this rule to be
enforced, the obvious result would be the position of insurers
that they will not pay until all other sources of payment have
been made.

The trial court further reasoned that:

The Allstate policy appears to show that the maximum payment
the Plaintiff could receive under that policy is $100,000,
including all payments from other sources. Though the State
Farm policy is not exhibited, State Farm’s pleadings before they
were dismissed from the action show that State Farm was
wanting to be credited for the medical payments it made against
the $100,000, including medical payments. Because the law
provides that the Allstate policy provides primary coverage, then
State Farm should not be required to make payments until the
Allstate policy is exhausted. Were we to allow Allstate an offset
then Allstate would pay some $32,500 and State Farm would
pay some $67,500.

[I]nsurance companies cannot be required to pay for losses in
excess of the limits to which they have agreed. . . . The proof
before us shows that the terms of each policy provide that an
injured Plaintiff is entitled to a maximum of $100,000 including
all payments. Thus, Allstate, which provides the primary

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 coverage, should be required to pay its limits if the evidence
justifies an award of $100,000 or more, and then State Farm is
entitled to subrogation as to the payments which it advanced.

Because the law provides that the Allstate policy of
insurance is primary, we find that Allstate should be required to
pay the entire limits of their policy to the extent that the
evidence justifies such payments. . . . [W]ere we to find that
Allstate is entitled to the setoff it claims, State Farm would pay
at least twice the sum that Allstate pays ($67,500 versus
$32,500), and the net effect of such a ruling would be that the
State Farm policy was actually primary, at least to the extent of
the costs of medical care. Such a decision would be in
derogation of the provisions of Tennessee law.

On March 14, 2013, the trial court entered an order on the motion for declaratory judgment,
in which it reiterated its findings and concluded that Allstate was not entitled to offset the
State Farm payment.

On March 25, 2013, Allstate filed a motion for interlocutory appeal under Tennessee Rule
of Appellate Procedure 9. Although the trial court granted the motion for interlocutory
appeal, this Court denied hearing the Rule 9 appeal by order of June 12, 2013. A final
hearing on the issue of damages was held by the trial court on April 17, 2014. By order of
May 22, 2014, the trial court held:

[T]he Court found that Plaintiffs are entitled to the sum of
$200,000.00 for injuries sustained in the automobile accident
from which this case arose. It is undisputed that Allstate
Insurance Company, the primary uninsured motorist carrier in
this case, has previously paid the sum of $2,000.00 to Plaintiffs
under the Medpay provisions of the uninsured motorist coverage
applicable to this case. It is further undisputed that Allstate’s
uninsured motorist limits of liability are $100,000.00.

IT IS THEREFORE ADJUDGED AND DECREED that
Plaintiffs are awarded damages against the Defendant, Penny D.
Clark, in the amount of $200,000.00 for injuries sustained in the
automobile accident out of which this case arose.

IT IS FURTHER, ORDERED, ADJUDGED AND

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 DECREED that the Plaintiffs shall take judgment against
Allstate Insurance Company in the amount of the uninsured
motorist limits of $100,000.00, less $2,000.00 for the amount
previously paid to Plaintiffs under the Medpay provisions of the
policy. The Plaintiffs shall have judgment against Allstate
Insurance Company, therefore, in the amount of $98,000.00.

II. Issue

Allstate appeals. The sole issue for review is whether Allstate is entitled to reduce its
uninsured motorist limits by amounts paid by the Appellee’s automobile insurance carrier.

III. Standard of Review

The issue in this appeal requires us to interpret both the language of the Allstate insurance
policy, and the relevant Tennessee uninsured motorist statutes. Accordingly, our analysis is
guided by several well-established principles. First, Tennessee law is clear that questions
regarding the extent of insurance coverage present issues of law involving the interpretation
of contractual language. Clark v. Sputniks, LLC, 368 S.W.3d 431, 436 (Tenn. 2012);
Maggart v. Almany Realtors, Inc., 259 S.W.3d 700, 703 (Tenn. 2008). Likewise, questions
regarding the interpretation of a statute involve issues of law. In re Estate of Trigg, 368
S.W.3d 483, 490 (Tenn. 2012). Therefore, our standard of review is de novo with no
presumption of correctness afforded to the conclusions reached by the trial court. U.S. Bank,
N.A. v. Tenn. Farmers Mut. Ins. Co., 277 S.W.3d 381, 386 (Tenn. 2009).

IV. Analysis

A. Applicable Statutory Language

Before turning to the applicable sections of Tennessee’s uninsured motorist law, we first note
that
[uninsured/underinsured motorist] statutes, as a matter of law,
become provisions of all automobile insurance policies issued
for delivery in Tennessee. Where there is a conflict between a
statutory provision and a policy provision, the statutory
provision must prevail.

Sherer et al. v. Linginfelter et al., 29 S.W.3d 451, 454 (Tenn. 2000) (citing Fleming v. Yi,

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982 S.W.2d 868, 870 (Tenn. Ct. App. 1998)).

When interpreting a statute, courts “must ascertain and give effect to the legislative intent
without restricting or expanding the statute's intended meaning.” U.S. Bank, 277 S.W.3d at
386. Our task is to examine the text of the statute and, if the language used is unambiguous,
we simply apply the plain meaning of the words used in the statute. Nye v. Bayer
Cropscience, Inc., 347 S.W.3d 686, 694 (Tenn. 2011); U.S. Bank, 277 S.W.3d at 386. As
the Tennessee Supreme Court recently observed, courts “must (1) give these words their
natural and ordinary meaning, (2) consider them in the context of the entire statute, and (3)
presume that the General Assembly intended to give each of these words its full effect.” In
re Estate of Trigg, 368 S.W.3d at 490. Every word in a statute is presumed to have meaning
and purpose. Nye, 347 S.W.3d at 694; Highwoods Props., Inc. v. City of Memphis, 297
S.W.3d 695, 701 (Tenn. 2009). If, after examining the text of the statute, it becomes clear the
statute is ambiguous, “we may reference the broader statutory scheme, the history of the
legislation, or other sources to discern its meaning.” Highwoods Props., 297 S.W.3d at 701;
see also Mills v. Fulmarque, Inc., 360 S.W.3d 362, 368 (Tenn. 2012) (“When necessary to
resolve a statutory ambiguity or conflict, courts may consider matters beyond the statutory
text, including public policy, historical facts relevant to the enactment of the statute, the
background and purpose of the statute, and the entire statutory scheme.”). “However, these
non-codified external sources cannot provide a basis for departing from clear codified
statutory provisions.” Mills, 360 S.W.3d at 368 (internal quotation marks omitted).

Concerning limits of liability for an insurer under its uninsured motorist coverage, Tennessee
Code Annotated Section 56-7-1201(d) states:

(d) The limit of liability for an insurer providing uninsured
motorist coverage under this section is the amount of that
coverage as specified in the policy less the sum of the limits
collectible under all liability and/or primary uninsured motorist
policies. . .applicable to the bodily injury or death of the insured.

The insurer providing the uninsured motorist coverage is also entitled to subrogation as
provided under Tennessee Code Annotated Section 56-7-1204:

(a) In the event of payment to any person under the coverage
required by this part, and subject to the terms and conditions of
the coverage, the insurer making payment shall, to the extent of
the coverage, be subrogated to all of the rights of the person to
whom payment has been made, and shall be entitled to the
proceeds of any settlement or judgment resulting from the

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 exercise of any rights of recovery of the person against any
person or organization legally responsible for the bodily injury
or property damage for which payment is made. . .

(Emphasis added). Importantly, the subrogation provisions, when read in pari materia with
the other uninsured motorist statutes, “allow[] the insurer to recover from its insured only
those amounts received from persons or entity causing those same damages.” Tenn. Code
Ann. §56-7-1204, cmt. 1; Sherer, 29 S.W.3d at 454.

Tennessee Code Annotated Section 56-7-1205 provides, in pertinent part, that:

Nothing contained in this part shall be construed as requiring the
forms of coverage provided pursuant to this part, whether alone
or in combination with similar coverage afforded under other
liability policies, to afford limits in excess of those that would
be afforded had the insured under the policies been involved in
an accident with a motorist who was insured under a policy of
liability insurance with the minimum limits described in §55-12-
107, or the uninsured motorist liability limits of the insured’s
policy if the limits are higher than the limits described in in §55-
12-107. The forms of coverage may include terms, exclusions,
limitations, conditions, and offsets that are designed to avoid
duplication of insurance and other benefits.

Tennessee courts have interpreted the statutory language, “[t]he forms of coverage may
include terms, exclusions, limitations, conditions, and offsets . . .,” to provide “limited
coverage.” In Terry v. Aetna Casualty & Surety Co., 510 S.W.2d 509 (Tenn. 1974), our
Supreme Court explained that limited coverage theory “is based on a finding [that] the
legislative purpose. . .is to provide insured a recovery only up to the statutory minimum
required without regard to insured’s actual damages, unless such be less than the statutory
minimum.” Id. at 513. As noted by this Court, “[t]he uninsured motorist insurance carrier
is entitled to a credit to offset its liability by any recovery received by the insured from
whatever source that would result in duplication of the amount to be collected under the
uninsured motorist coverage.” Clark v. Shoaf, 302 S.W.3d 849, 856 (Tenn. Ct. App. 2008).
Accordingly, the usual uninsured motorist endorsements provide for reduction of the
uninsured motorist limits for (a) payments made under the liability or medical payment
feature of the policy; (b) amounts paid under any workers’ compensation law, disability
benefits law, or similar law; and (c) all sums paid by or on behalf of persons or organizations
who may be legally responsible. See generally Phillip A. Fleissner & Paul Campbell III,
Tennessee Automobile Liability Insurance § 18.2 (2007-08 ed.); see, e.g., Green v. Johnson,

7
249 S.W.3d 313 (Tenn. 2008) (holding that insurer was allowed to offset any amounts
insured received from settlement with non-motorist tortfeasors against the amounts owed
under underinsured motorist policy); Poper ex rel. Poper v. Rollins, 90 S.W.3d 682 (Tenn.
2002) (holding that insurer was entitled to offset amounts collected by insured in settlement
with other defendants); Giannini v. Proffitt, No. W2011–00342–COA–R3–CV, 2012 WL
1478785 (Tenn. Ct. App. April 27, 2012) (holding that the limitation of liability language in
uninsured motorist policy, reducing insurer’s liability by sums paid under laws similar to
workers’ compensation laws, applied to preclude recovery); Sherlin v. Hall, 237 S.W.3d 647
(Tenn. Ct. App. 2007) (holding that the limits of liability of the uninsured motorist coverage
policy were reduced and, in fact, negated by the amount of the workers’ compensation
benefits paid to insured).

B. Relevant Contract Language

Also well-established in Tennessee is the principle that “[i]nsurance policies are, at their
core, contracts.” Allstate Ins. Co. v. Tarrant, 363 S.W.3d 508, 527 (Tenn. 2012) (Koch, J.,
dissenting). As such, courts interpret insurance policies using the same tenets that guide the
construction of any other contract. Am. Justice Ins. Reciprocal v. Hutchison, 15 S.W.3d
811, 814 (Tenn. 2000). Thus, the terms of an insurance policy “‘should be given their plain
and ordinary meaning, for the primary rule of contract interpretation is to ascertain and give
effect to the intent of the parties.’” Clark, 368 S.W.3d at 441 (quoting U.S. Bank, 277
S.W.3d at 386–87). The policy should be construed “as a whole in a reasonable and logical
manner,” Standard Fire Ins. Co. v. Chester–O'Donley & Assocs., 972 S.W.2d 1, 7(Tenn.
Ct. App.1998), and the language in dispute should be examined in the context of the entire
agreement. Cocke City Bd. of Highway Comm'rs v. Newport Utils. Bd., 690 S.W.2d 231,
237 (Tenn.1985).

In addition, contracts of insurance are strictly construed in favor of the insured, and if the
disputed provision is susceptible to more than one plausible meaning, the meaning favorable
to the insured controls. Tata v. Nichols, 848 S.W.2d 649, 650 (Tenn.1993); VanBebber v.
Roach, 252 S.W.3d 279, 284 (Tenn. Ct. App. 2007). However, a “strained construction may
not be placed on the language used to find ambiguity where none exists.” Farmers–Peoples
Bank v. Clemmer, 519 S.W.2d 801, 805 (Tenn.1975).

Part V of the Allstate policy is titled “Uninsured Motorist Insurance Coverage.” This part
contains the following, relevant language under the “Exclusions–What is not Covered”
section:

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 Limits of Liability

* * *

Limits payable will be reduced by all amounts paid or payable
by the owner or operator of the uninsured auto or anyone else
responsible. This includes all sums collected or collectible
under the bodily injury liability coverage of this or any other
policy and all sums collected or collectible under the uninsured
motorist coverage of this or any other policy.

* * *

2. Damages payable will be reduced by:

a) all amounts paid by or on behalf of the owner or operator of
the uninsured auto, including an uninsured auto or anyone else
responsible. This includes all sums paid under the bodily injury
liability coverage or property damage liability coverage of this
or any other auto policy.

b) all amounts paid or payable under any workers compensation
law, disability benefits law, or similar law, Automobile Medical
Payments, or any similar medical payments coverage under this
or any other auto policy. . . .

Allstate contends that the language “Automobile Medical Payments, or any similar medical
payments coverage under this or any other auto policy. . .” allows it to offset the $70,021.32
in medical payments that were paid on Ms. Powell’s behalf under her own State Farm policy.
In this regard, the instant case is similar to Elsner v. Walker, 879 S.W.2d 852 (Tenn. Ct.
App. 1994), perm. app. denied (Tenn. June 13, 1994). In Elsner, the uninsured motorist
policy provided that “the limit of liability shall be reduced by all sums paid because of bodily
injury or property damage by or on behalf of persons or organizations who may be legally
responsible.” Id. at 853. As in this case, in Elsner, the insurer sought a setoff for medical
insurance coverage provided to the plaintiffs by their own medical insurance carrier. Id. This
Court interpreted the language, “persons or organizations who may be legally responsible,”
to mean “that the insurer intends to reduce its liability by the amount received from others
who are responsible for the damage or injury.” Id. at 854 (emphasis added). The Elsner
Court noted that the insurance contract at issue in that case did not contain “an explicit, plain
statement that the [insurer’s] liability would be reduced by sums paid by an insured’s medical

9
insurance carrier.” Id. The Court further noted that if the insurer had intended that it be
entitled to a reduction for payments of an insured’s medical insurance, it could have included
such a provision. Id.

As noted by this Court in Elsner, courts interpreting offset language have “found that
liability may be reduced by all sums paid because of bodily injury or property damage by or
on behalf of persons or organizations legally responsible for injury or damage.” Id. at
854 (emphasis added) (citing Brinkman v. Aid Ins. Co., 766 P.2d 1227, 1233-34 (Idaho
1988) (rejecting insurer’s argument that it could reduce its liability by the value of a college
scholarship granted to insured as a result of injuries insured sustained in automobile
accident); Aills v. Nationwide Mutual Ins. Co., 363 S.E.2d 880 (N.C. 1988) (dismissing
insurer’s argument that the plaintiff’s uninsured motorist coverage should be reduced by
medical payments made under another provision of the automobile policy and disability
payments made through a separate disability policy).

While the insurer in Elsner ostensibly sought to nullify the qualifying term “by or on behalf
of persons or organizations who may be legally responsible,” in Edmondson v. Solomon,
No. 01A01-9802-CV-00097, 1999 WL 11512 (Tenn. Ct. App. 1999), the insurer sought to
have this Court nullify the term “law,” i.e., “we will not pay for any element of loss if a
person is entitled to receive payment for the same element of loss under any of the following
or similar law.” Id. at *1. In Edmondson, we held that the offset was not allowed for
payments under employer’s and personal disability policies because these payments were not
made under any disability benefits law. Id. at *3; but see Giannini v. Proffitt, No. W2011-
00342-COA-R3-CV, 2012 WL 1478785 (holding that sums paid under laws similar to
workers’ compensation laws, applied to limit insurer’s uninsured motorist liability). In
discussing the validity of various offset provisions in uninsured motorist coverage policies,
Tennessee Automobile Liability Insurance § 18.2 cites the Edmondson case for the
proposition that:

While there is logical basis for offsetting payments by parties at
fault, certain types of payments made by the insured’s own
automobile insurance carrier, and statutory workers’
compensation or similar benefits, surely it is doubtful that the
Commissioner of Insurance would allow filings diminishing
[uninsured motorist] coverage by payments secured under an
insured’s individual or group health insurance or disability
insurance plan.

Id. at n. 6. We concede that Tennessee’s adoption of “limited coverage” has led to the
primary objective of liberally allowing offsets so long as those offsets do not “result in

10
duplication of the amount to be collected under the uninsured motorist coverage.” Clark,
302 S.W.3d 849; Boyce v. Geary, No. 01-A-01-9409-CV-00410, 1995 WL 245389 (Tenn.
Ct. App. April 28, 1995). However, there is also a more subtle concept of legal liability at
play in the statutes and caselaw. This idea of liability is not specifically fault-based; rather,
it rests upon the equitable notion that various offsets, although broadly construed to give
effect to the limited coverage scheme our Legislature has adopted, should nonetheless be
allowed only if such payments are made by the party at fault for the accident, or the person
or entity legally responsible. Sherer, 29 S.W.3d at 454 (holding that the uninsured motorist
coverage statutes allow the insurer to recover from its insured only those amounts received
from the person or entity causing those same damages).

We concede that the language employed in the Allstate policy is more specific than the
language at issue in the Elsner policy in that the language here clearly contemplates offset
for medical payments, i.e., “[d]amages payable will be reduced by. . . any similar medical
payments coverage under this or any other auto policy.” As noted above, insurance policies
should be construed “as a whole in a reasonable and logical manner,” Standard Fire Ins. Co.
v. Chester–O'Donley & Assocs., 972 S.W.2d 1, 7 (Tenn. Ct. App.1998), and the language
in dispute should be examined in the context of the entire agreement. Cocke City Bd. of
Highway Comm'rs, 690 S.W.2d at 237. In addition, as a matter of law, all provisions of the
Tennessee Uninsured Motorist statute are made part of all insurance policies issued for
delivery in Tennessee. See Dunn v. Hackett, 833 S.W.2d 78 (Tenn. Ct. App. 1992). This
means that we must interpret the policy language in light of the legislative intent as set out
in the applicable portions of the uninsured motorist law. We have previously discussed the
holding that the uninsured motorist coverage statutes allow the insurer to recover from its
insured only those amounts received from the person or entity causing those same damages.
This intent is acknowledged in the Allstate policy at issue here. The uninsured motorist
coverage section of the policy, states that the “[l]imits payable will be reduced by all amounts
paid or payable by the owner or operator of the uninsured auto or anyone else responsible”
(emphasis added). While the specific reduction of damages language in the policy broadly
states that damages payable will be reduced by “any similar medical payments coverage
under this or any other policy,” under well-settled contract interpretation principles, we must
read this language in pari materia with the entire agreement. Accordingly, we read the broad
exception for medical payments in light of the language set out in the same section of the
policy that policy limits will be reduced by payments paid or payable by “anyone else
responsible.”

Here, there is no dispute that State Farm is not the legally responsible insurer. As discussed
above, by statute, Allstate is the legally responsible uninsured motorist carrier in this case.
Nonetheless, Allstate seeks to reduce its legal obligation to pay under the uninsured motorist
section of the policy by monies paid by State Farm to its insured for medical coverage. To

11
allow such offset would not only contradict the contractual language that policy limits will
be reduced by payments made by “anyone else responsible,” but such interpretation would
also violate the legislative intent to limit offsets to those monies paid or payable by the
legally responsible parties.

In addition to not being the legally responsible entity in this case, see Tenn. Code Ann. §56-
7-1201(b)(3)(A), State Farm may also have a right of subrogation against Allstate for the
$70,021.32 it paid to the Powells. Tenn. Code Ann. §56-7-1204. The trial court’s
memorandum opinion indicates that State Farm pursued its subrogation right in this case.
Regardless, in Bayless v. Pieper et al., No. M2008-01073-COA-R3-CV, 2009 WL 2632763
(Tenn. Ct. App. Aug. 26, 2009), we held that an insurer was not entitled to reduce its
obligation under an uninsured motorist policy by setting off the portion of the liability
benefits payment that were used to pay the workers’ compensation subrogation interest. Id.
at *1. The Bayless Court reasoned that “[a] holding to the contrary would cause the insured
to suffer a double reduction in benefits resulting from a single settlement payment made by
the tortfeasor’s liability insurer.” Id. at *3 (citing Boyce, 1995 WL 245389 at *3).
Furthermore, such holding would “ignore language included in the statute to protect the
rights of insureds against the otherwise unrestricted power of insurance companies to impose
on them limitations and offsets which could effectively eliminate the benefits to which their
premium payment entitles them.” Id. In so holding, the court noted that the “duplication”
language in the statute is to “prevent the insured from receiving a windfall in benefits, not
to empower insurers to receive a windfall in offsets or eliminate benefits they are obligated
to pay.” Id. at *4. The interpretation proposed by Allstate in this case would frustrate the
legislative purpose and would ignore the contractual language allowing reduction of benefits
by sums collected by “anyone else responsible.” Accordingly, we cannot interpret the
disputed policy language to allow Allstate an offset for those payments made by State Farm
in this case.

V. Conclusion

For the foregoing reasons, we affirm the order of the trial court. The case is remanded for
such further proceedings as may be necessary and are consistent with this opinion. Costs of
the appeal are assessed against the Appellant, Allstate Insurance Company, and its surety.

_________________________________
KENNY ARMSTRONG, JUDGE

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