The California Court of Appeal has held that, where two uninsured motorist policies have different limits, a pro-rata provision in one policy will control over an excess provision in the other policy. ( Allstate Insurance Company v. Mercury Insurance Company (2007) WL 2482507)
Facts
Meyan Mendoza was a passenger in an automobile driven by Ivanrey Capistrano. An uninsured motorist struck the vehicle and Mendoza was injured in the accident.
Mendoza made a UM claim under Capistrano’s auto policy through Mercury Insurance Company. The Mercury policy provided UM coverage of $30,000 and included a “pro-rata” coverage provision.
Mendoza also made a UM claim under her own auto policy through Allstate Insurance Company. The Allstate policy provided UM coverage of $250,000 and included an “excess” coverage provision.
Allstate filed a declaratory relief action seeking a judicial determination that its policy was excess to the Mercury policy. The trial court ruled in favor of Mercury, holding that the two policies had to contribute to Mendoza’s claim on a pro-rata basis. Allstate appealed.
Holding
The Court of Appeal affirmed. It reasoned that Insurance Code section 11580.2(d) permits an uninsured motorist policy to require pro-ration if an insured has UM insurance available under more than one policy. While a policy is not required to include a pro-rata provision, if the policy does so, it must be given effect. Here, since Mercury’s policy contained a pro-rata provision, it prevailed over Allstate’s excess provision.
Comment
This case illustrates that courts will give effect to an uninsured motorist policy which follows the statutory pro-rata provision, even where another applicable uninsured motorist policy includes an excess provision.