When Does Uninsured / Underinsured Coverage Kick-In?

Dallas insurance attorneys need to know when uninsured / underinsured coverage is available as a benefit.
The Texas Supreme Court case United States Fidelity and Guarantee Company v. Goudeau, which is an opinion issued in 2008, is a good reference.
Here are some relevant points of the case.
One can imagine few more sympathetic litigants than Louis Goudeau, a ” Good Samaritan” who stopped his car on a Houston freeway to help a stranded motorist. After leaving his car to approach the disabled one, Goudeau was severely injured when a third driver smashed into both cars and pinned him between them and a retaining wall.
There is no question Goudeau can recover from the driver who caused this accident-he already has. But that driver had only $20,000 in insurance. The question instead is whether Goudeau can recover under his employer’s underinsured motorist policy, which applies only if Goudeau was ” occupying” his car at the time of the accident. The court of appeals found a fact question on that issue, even though Goudeau had exited his car, closed the door, and walked around the front toward the retaining wall when the accident occurred.
It is natural to sympathize with a litigant who has suffered harm caused by someone who cannot pay the consequences. But if sympathy were a rule of contract construction, there would soon be no law of contracts left. Under the insurance policy here, Goudeau was not ” occupying” his car at the time of the accident, so he cannot recover under this policy.
Goudeau worked for Advantage BMW, and was driving one of its cars in the course of his employment. He stopped on the right shoulder of the Sam Houston Tollway to help another driver who had collided with the freeway’s retaining wall. After getting out of his car and walking around the front toward the retaining wall, a car driven by Alex Rodriguez slammed into both parked cars, pinning Goudeau against the retaining wall and crushing his pelvis.
Advantage BMW had two policies with USF & G: a workers compensation policy, and an auto policy with uninsured/underinsured coverage of $1 million. USF & G paid more than $100,000 in benefits to Goudeau and his medical providers under the compensation policy, but denied benefits under the underinsured-motorist policy.
A year after Goudeau filed suit against Rodriguez, the latter tendered his policy limits of $20,000. Goudeau then amended to sue USF & G for breach of the underinsured-motorist policy. USF & G answered using one law firm, and a few days later intervened using a different law firm to assert its $100,000 statutory subrogation claim against the money Goudeau recovered in the suit.
The trial court granted summary judgment against Goudeau on his underinsured claim. The court of appeals reversed and remanded for trial, finding a fact issue as to whether Goudeau was ” occupying” his vehicle. The underinsured policy here covered certain designated Advantage BMW employees, as well as any others ” occupying” an Advantage vehicle during a collision. Goudeau was not designated in the policy, so there is no coverage unless he was ” occupying” a covered car when the collision occurred. The standard-form policy defined ” occupying” as ” in, upon, getting in, on, out or off.”
Goudeau concedes he was not ” in” his car when the accident occurred, nor was he in the process of ” getting in, on, out, or off” of it. He asserts coverage only on the ground that he was ” occupying” the car by being ” upon” it when he was injured.
Under the traditional canon of construction noscitur a sociis, each of the words used here must be construed in context. In this context, a person sitting in the back of a pickup at the time of an accident might be ” occupying” the vehicle by being ” upon” it.
But a driver who has exited the car, closed the door, walked around the front, and then has the vehicle smashed into him cannot be said to be ” occupying” the vehicle at the time of the collision, even if afterwards he ends up partly ” upon” it. Construing “upon” to include the situation here would ” ascribe to one word a meaning so broad that it is inconsistent with its accompanying words.”
Under Texas law, Courts are required to construe insurance policies according to their plain language, using ” the ordinary, everyday meaning of the words to the general public.”
Similarly, the accident report from the Department of Public Safety (which showed the relative positions of Goudeau and the cars at the time of the accident) was authenticated by its records custodian. As these documents provide all that is necessary to decide the policy construction issue here, the trial court did not err in overruling Goudeau’s objections.
Accordingly, this Court reversed that part of the court of appeals’ judgment concerning Goudeau’s underinsured motorist claim, and rendered judgment that he take nothing on that claim.