Remedios and Saturnino Batacan (Batacans) claim their underinsured motorist carrier, Allstate Insurance Company, wrongfully denied coverage for injuries sustained in a three-car accident. Allstate prevailed at the trial court on summary judgment, a result which was affirmed on appeal to the Court of Appeals, Division Two. We granted review and reverse.
Facts
As the Batacans passed a stalled truck driven by Sang Kim on Interstate 5, Margery Cantrill collided with the truck, pushing it into the Batacans’ vehicle. Kim had no liability insurance; however Cantrill had $300,000 limits through Safeco Insurance Company. The Batacans sued both Kim and Cantrill while simultaneously claiming the benefit of underinsured motorist (UIM) coverage through Allstate by virtue of the fact that Kim was uninsured.
Unable to resolve their differences, the Batacans and Allstate proceeded to an underinsured motorist arbitration pursuant to policy provisions.1 The three-arbitrator panel determined that Kim and Cantrill were each 50 percent responsible for the accident, assessing Remedios Batacan’s damages for a shoulder injury at $58,000 and Saturnino Batacan’s damages at $2,000. Allstate, however, refused to *446pay anything, claiming the right to offset Cantrill’s $300,000 liability against the $60,000 total damages, suggesting the Batacans try to settle with Cantrill “in the neighborhood of the arbitration award.” Clerk’s Papers (CP) at 46.
To confirm the propriety of coverage denial Allstate filed a declaratory judgment action seeking a judicial declaration that it had no obligation to pay UIM benefits in any amount to the Batacans. The Batacans answered and counterclaimed for breach of the insurance contract, violation of the Consumer Protection Act, bad faith, fraud, and equitable relief. Thereafter the Batacans settled with Cantrill and her insurance carrier, Safeco, for $54,000. The claim against Kim, however, was not settled.
On cross-motions for summary judgment, the Pierce County Superior Court declared the Batacans were not entitled to UIM coverage from Allstate and for that reason dismissed the Batacans’ counterclaims as well. The Court of Appeals affirmed, reasoning that Kim and Cantrill were jointly and severally liable and since Cantrill’s limits of liability exceeded the total damages awarded in the arbitration, a complete setoff of Cantrill’s limits of liability against the UIM arbitration award was appropriate pursuant to Allstate Ins. Co. v. Dejbod, 63 Wn. App. 278, 284, 818 P.2d 608 (1991).
Although both the Batacans and Allstate briefed and argued their interpretations of the underinsured motorist statute, RCW 48.22.030, neither claims this contract of insurance is inconsistent with that statute or otherwise void for public policy reasons. Accordingly, we determine this case based upon the plain language of the governing contract of insurance.
The underinsured motorist endorsement to that policy generally provides that it is the responsibility of the insurance company to pay those damages its insured would be legally entitled to recover from an underinsured motorist up to policy limits:
*447B. WE WILL PAY
1. We will pay all sums the insured is legally entitled to recover as damages from the owner or driver of an underinsured motor vehicle.
2. We will pay under this insurance only after all applicable liability bonds or policies have been exhausted by judgments or payments.
CP at 59 (Underinsured Motorists Insurance (UIM) endorsement ¶ B.1.-2.).
The policy also defines “underinsured motor vehicle”:
A. 4. “Underinsured motor vehicle” means a land motor vehicle or trailer:
a. For which no liability bond or policy applies at the time of an accident, or
b. For which there is a liability bond or policy at the time of an accident but which does not provide at least the amount an insured is legally entitled to recover as damages caused by the accident, or ... .
CP at 58 (UIM endorsement ¶ A.4.a.-b.).
The policy also limits Allstate’s liability:
E. OUR LIMIT OF LIABILITY
2. Any amount payable for damages which the insured is legally entitled to recover from the owner or operator of an underinsured motor vehicle because of bodily injury or property damage caused by an accident shall be reduced by:
b. All sums paid by or for anyone who is legally responsible, including all sums paid under the policy’s LIABILITY INSURANCE.
CP at 59 (UIM endorsement ¶ E.2.b.).
*448Issues
In the final analysis three issues are presented:
1. Was the Kim vehicle an “underinsured motor vehicle”? We answer yes.
2. If so, were Kim and Cantrill jointly and severally liable for the Batacans’ damages? We answer no.
3. If there were joint and several liability, would Allstate’s obligation to pay the Batacans be extinguished? We leave this answer for another day.
As the only question before this court is the legal issue of insurance coverage, our review is de novo. Mid-Century Ins. Co. v. Henault, 128 Wn.2d 207, 212, 905 P.2d 379, 59 A.L.R.5th 789 (1995).
Analysis
I
Did Kim drive an “underinsured motor vehicle”?
The threshold contract question is easily resolved in the Batacans’ favor because Kim is “the owner or driver of an underinsured motor vehicle” (CP at 59 (UIM endorsement ¶ B.l.)) and the Kim vehicle is a “motor vehicle . . . [f]or which no liability bond or policy applies at the time of an accident . . . .” (CP at 58 (UIM endorsement ¶ A.4.a.)). The fact, or prospect, that Batacans can also make a recovery from Cantrill, or Cantrill’s liability policy, does not make the Kim vehicle insured.
Under certain circumstances the liability policy of the third vehicle may be a collateral source for recovery to the injured victim; however, under no circumstances can it be said that the liability policy, which covers the third vehicle, “applies” to make the otherwise uninsured second vehicle “insured.” In short, Cantrill’s liability policy covers or applies to the Cantrill vehicle; it does not cover or apply to the Kim vehicle. The Kim vehicle is still an “underinsured motor vehicle” even if Cantrill’s liability insurance is directly or indirectly available for the benefit of the Bata*449cans to compensate damages incurred by the Batacans in an accident where Cantrill and Kim are jointly and severally liable. The Kim vehicle is therefore “an underinsured motor vehicle” under this policy’s definition because it has no insurance which applies to it2
II
Are Kim and Cantrill jointly and severally liable?
Joint and several liability under our statutory scheme is a term of art which requires an actual judgment against both tortfeasors. RCW 4.22.070(l)(b).3 There is no joint and several liability under the statute where there is no judgment against the tortfeasors. Arbitration findings apportioning fault between absent parties is not a judgment against those parties. As we recently held, parties not named in the underlying action “are certainly not defendants against whom judgment was entered” for the purposes of joint and several liability. Kottler v. State, 136 Wn.2d 437, 449, 963 P.2d 834 (1998); id. at 447 n.9 (“ ‘[A] person is not liable to the plaintiff at all, much less jointly and severally, if he or she has not been named by the plaintiff.’ ” (quoting Mailloux v. State Farm Mut. Auto. Ins. Co., 76 Wn. App. 507, 513, 887 P.2d 449 (1995))); see also Anderson v. City of Seattle, 123 Wn.2d 847, 852, 873 P.2d 489 (1994) (party must be named defendant to be defendant against whom judgment is entered under RCW 4.22.070(l)(b)). Only where UIM recovery follows an actual judgment taken against both at-fault tortfeasors (and the plaintiff is *450adjudged without fault) can joint and several liability be a factor. Such is unlikely under this policy of insurance where arbitration normally precedes judgment against the tortfeasor (s). Arbitration is not required by our UIM statute — it is a choice these parties freely incorporated into their insurance contract. By agreeing to this arbitration clause these parties diminished the prospect of joint and several liability under the UIM coverage by contracting to allow a determination of liability and damages caused by the underinsured motorist in an arbitration prior to or in lieu of judgment against the actual tortfeasors.4
There are two alternatives open to the insurance company where the insurance contract allows arbitration prior to judgment against potentially liable tortfeasors: (1) the UIM insurance carrier may buy out the claim of its insured and sue the tortfeasors, accepting the prospects of success along with the risk of failure; or (2) the UIM carrier may simply pay its insured those damages attributable to the uninsured or underinsured tortfeasor, retaining the right to proceed against that tortfeasor. Hamilton v. Farmers Ins. Co., 107 Wn.2d 721, 734, 733 P.2d 213 (1987).
Our holding that denial of coverage was improper in this case is compelled by the contract itself which incorporates the statutory standard by requiring Allstate to pay damages the Batacans are “legally entitled to recover as damages from the owner or driver of an underinsured motor vehicle.” CP at 59 (UIM endorsement ¶ B.I.). Here, based on this arbitration result, the Batacans would be entitled to recover $30,000 from Kim if Kim’s liability were several, $60,000 if it were joint.5 But Allstate paid nothing.
We have already described a finding of joint and several *451liability based on what might have happened if an action had been pursued to judgment as “ £a tortured reading’ ” of the statute. Gerrard v. Craig, 122 Wn.2d 288, 296-97 n.20, 857 P.2d 1033 (1993) (quoting with approval Cornelius J. Peck, Washington’s Partial Rejection and Modification of the Common Law Rule of Joint and Several Liability, 62 Wash. L. Rev. 233, 253-54 (1987)). Consistent with the statute’s mandate that actual judgment be rendered against both tortfeasors as a condition precedent to joint and several liability, claims for contribution based upon a situation which would otherwise arguably constitute joint and several liability if pursued to judgment also fail absent actual entry of the joint judgment. Kottler, 136 Wn.2d at 447. See also Washburn v. Beatt Equip. Co., 120 Wn.2d 246, 298, 840 P.2d 860 (1992) (settling parties are not jointly and severally liable as “question of plaintiffs fault is not determined by a trier of fact until close of trial . . . .”); cf. In re Arbitration of Doyle, 93 Wn. App. 120, 125, 966 P.2d 1279 (1998) (“While the trier of fact may attribute fault to settling, released defendants, such defendants cannot have judgment entered against them within the meaning of RCW 4.22.070(1). Thus, released defendants are not jointly and severally liable.”).6
Dejbod is also consistent with this view. Dejbod correctly announced the governing principle: “A UIM insurer can subtract a liability policy pursuant to RCW 48.22.030(1) if the person insured by the liability policy is liable to the injured claimant . . . .” Dejbod, 63 Wn. App. at 285. But Kim had no liability policy, and therefore there is nothing to subtract from Allstate’s obligation to compensate the Batacans for the damages Kim caused.
However, in Dejbod the Court of Appeals stated if the liability of the tortfeasors is joint and several “pursuant to *452RCW 4.22.070(1)” (which requires a judgment), the insurer could deduct the combined total of the two liability coverages. Dejbod, 63 Wn. App. at 292. Whether liability coverages may be combined, and then set off, under the language of this policy is a question this court has yet to answer and one we need not answer today because there is no joint and several liability here “pursuant to RCW 4.22.070(1)”— which would require actual judgment against both tortfeasors. But see Finney v. Farmers Ins. Co., 92 Wn.2d 748, 751-53, 600 P.2d 1272 (1979) (uninsured motorist coverage available where one jointly responsible person is insured but the other is not). The Dejbod court did not purport to dispense with the judgment requirement; in fact it cautioned, “Either or both policies may become applicable when the liability of [the potential joint tortfeasors] is adjudicated,” an event which had not happened by the time of the arbitration in Dejbod. 63 Wn. App. at 291.
In re Arbitration of Fortin, 82 Wn. App. 74, 82, 914 P.2d 1209 (1996), overruled on other grounds by Price v. Farmers Ins. Co., 133 Wn.2d 490, 500 n.10, 946 P.2d 388 (1997), firmly supports the position advanced by the Batacans as well.
Fortin held the UIM carrier was obligated to directly pay the 50 percent share of an uninsured phantom vehicle (which arguably would have been joint and several if reduced to judgment) because “ £[a] court cannot adjudicate the rights of parties who are not actually or constructively before it, with an opportunity to defend or maintain their rights in the action. As a result, Smith [driver with adequate liability insurance] is only severally hable.’ ” Fortin, 82 Wn. App. at 83 (quoting Bayha v. Public Util. Dist. No. 1, 2 Wn.2d 85, 113, 97 P.2d 614 (1939) and citing Mailloux, 76 Wn. App. at 513).
Nor is In re Arbitration of Doyle, 93 Wn. App. at 125, inconsistent with this view as it holds a settlement with a tortfeasor prior to arbitration destroys any possibility of joint and several liability for the purpose of UIM coverage. As a prearbitration settlement eliminates the possibility of *453joint and several liability for UIM purposes, a postarbitration, but prejudgment, settlement does so as well.
We also note the limitation of liability clause in paragraph E.2.b., which allows a setoff of actual payments “by or for anyone who is legally responsible” (CP at 59), relates to “damages which the insured is legally entitled to recover from the owner or operator of an underinsured motor vehicle .. . .” (Id. at UIM endorsement ¶ E.2.) This, however, does not allow a setoff of Cantrill’s payment for the damages she caused against recovery of the damages caused by Kim because Cantrill’s payment is “by or for” Cantrill, not Kim. Therefore we hold Allstate wrongfully denied coverage for that portion of the UIM arbitration award attributable to Kim ($30,000).
Conclusion
We enforce, as written, the contract of insurance which Allstate has drafted and these parties have executed. The trial court summary judgment is reversed and this case is remanded for further appropriate proceedings consistent with this opinion. The Batacans shall recover their reasonable attorney fees, having prevailed on the coverage issue. Olympic S.S. Co. v. Centennial Ins. Co., 117 Wn.2d 37, 811 P.2d 673 (1991); Leingang v. Pierce County Med. Bureau, Inc., 131 Wn.2d 133, 147, 930 P.2d 288 (1997).
Smith, Johnson, and Alexander, JJ, and Dolliver, J. Pro Tem., concur.
F. CHANGES IN CONDITIONS
4. The following Condition is added:
ARBITRATION
a. If we and an insured disagree whether the insured is legally entitled to recover damages from the owner or driver of an underinsured motor vehicle or do not agree as to the amount of damages, either party may make a written demand for arbitration. . . .
Clerk’s Papers (CP) at 60 (UIM endorsement ¶ F.4.a.).
The dissent mistakenly describes Allstate’s UIM coverage as “secondary.” Dissent at 454. To the contrary, where the tortfeasor has no liability insurance, there is nothing for UIM coverage to be “secondary” to. In that instance UIM coverage is primary
RCW 4.22.070(l)(b) states the liability of each defendant shall be several only and shall not be joint except
[i]f the trier of fact determines that the claimant or party suffering bodily injury or incurring property damages was not at fault, the defendants against whom judgment is entered shall be jointly and severally liable for the sum of their proportionate shares of the claimants [claimant’s] total damages.
(Emphasis added.)
As set forth in Thomas V Harris, Washington Insurance Law § 36.3, at 36-10 (1995), the situation could he different if the arbitration followed a full litigation against all alleged tortfeasors, or if there were no arbitration clause at all.
The dissent would hold the UIM carrier “is not liable to pay UIM benefits when the primary liability insurance applicable to the claimants’ damages is sufficient to fully compensate them for all of their damages.” Dissent at 454. The problem with this statement is three-fold: (1) “primary” liability insurance is applicable to only one tortfeasor, not the other; (2) that liability policy is liable to compensate for damages caused by only the vehicle it insures, not the vehicle it *451does not; and (3) absent joint liability as per the statute, the liability policy at issue here is available to pay only 50 percent of the damages, not “all of their damages.”
This clearly makes sense, as the outcome of a litigation can never be known in advance. See United States v. Armour & Co., 402 U.S. 673, 681, 91 S. Ct. 1752, 29 L. Ed. 2d 256 (1971); Washburn v. Beatt Equip. Co., 120 Wn.2d 246, 298, 840 P.2d 860 (1992).