Uninsured Motorist Protection – When Does It Apply?

Weatherford insurance lawyers need to be able answer the above question. The problem with an answer is that, depending on the situation it is difficult to know when coverage will apply to a request for coverage for uninsured motorist protection.
In 2008, the Texas Supreme Court issued an opinion in the case styled, “Nationwide Insurance Company v. Elchehimi.” This case is not particularly good news for applicants but is important for an Insurance Law Attorney to know, so as to be able to properly advise clients. This is a summary judgment case in favor of Nationwide. Here is some of the relevant information about the case.
Mohamad Elchehimi’s station wagon collided with a drive axle and attached tandem wheels that had separated from an eighteen-wheel semi-trailer truck. The unidentified truck, which was being driven in the opposite direction on a divided highway, did not stop. Momentum carried the axle-wheel assembly across the dividing median where it struck Elchehimi’s vehicle, injuring the occupants and damaging the car. Elchehimi had purchased from Nationwide a standard Texas personal automobile insurance policy, including the optional statutorily defined unidentified motorist coverage. Nationwide denied Elchehimi’s claim for uninsured motorist benefits because the impact between Elchehimi’s vehicle and the axle-wheel assembly was not “actual physical contact” with an unknown “motor vehicle” as required by the terms of the policy and the Texas Insurance Code.
Elchehimi sued Nationwide for breach of contract and breach of the duties of good faith and fair dealing.
The parties do not dispute the facts of the collision and agree that the following statutory provision, which provides the parameters of coverage for damage or injury caused by unidentified motorists in Texas, governs this dispute:
Pursuant to the Texas Insurance Code, Section 1952.104(3), for the insured to recover under the uninsured motorist coverage if the owner or operator of any motor vehicle that causes bodily injury or property damage to the insured is unknown, actual physical contact must have occurred between the motor vehicle owned or operated by the unknown person and the person or property of the insured. The relevant policy language is consistent with the statute. To survive summary judgment, Elchehimi must raise a fact issue that his vehicle’s collision with the axle-wheel assembly qualified as “actual physical contact” with a “motor vehicle” or a legally recognized substitute for such contact.
Because there was actual physical contact between Elchehimi’s vehicle and the axle-wheel assembly, the Court examined whether the assembly is a motor vehicle under the Texas Insurance Code. It does not define motor vehicle. However, the common usage of the term motor vehicle does not include a single axle attached to two wheels. Common usage has made the phrase “motor vehicle” a generic term for all classes of self-propelled vehicles not operating on stationary rails or tracks. In addition, other relevant statutory definitions aid in analysis. The Texas Insurance Code expressly incorporates the Texas Motor Vehicle Safety-Responsibility Act, chapter 601 of the Transportation Code. Chapter 601 sets minimum coverage amounts for vehicle liability insurance, and those amounts explicitly apply to uninsured motorist coverage. Because Section 1952.104 (3) and Chapter 601 address the same subject matter-motor vehicle insurance-the definition of motor vehicle in section 601.002 of the Transportation Code is persuasive, if not controlling. Chapter 601.002(5) defines a motor vehicle as “a self-propelled vehicle designed for use on a highway, a trailer or semitrailer designed for use with a self-propelled vehicle, or a vehicle propelled by electric power from overhead wires and not operated on rails.”
A drive axle with two tandem wheels attached on one side lacks an engine or other means of propulsion. It is therefore neither a self-propelled vehicle nor a vehicle propelled by electric power from overhead wires. This wheel assemblage is not capable of carrying a load, nor can it be towed down a road by a self-propelled vehicle other than being dragged by or mounted underneath one. The axle-wheel assembly is thus not a trailer or semitrailer designed for use with a self-propelled vehicle. The axle-wheel assembly is not a motor vehicle under Chapter 601. Applying the common usage of the term and the definition in Chapter 601, the Court concluded that physical contact with a detached axle and tandem wheels is not actual physical contact with a motor vehicle under the unidentified motor vehicle provision.
No other substitute exists for the requirement of actual physical contact with the motor vehicle itself. Texas courts have uniformly rejected the contention that a collision with cargo and other objects falling from a car satisfies the requirement of actual physical contact with a motor vehicle.
This case is an example of how coverage under the uninsured motorist provision in an insurance policy can be confusing.