Baldassano was a passenger in a car involved in a one vehicle accident. He settled with the driver for the driver's $100,000 policy limit. His damages exceeded that amount and he made an underinsured motorist (UIM) claim under his own policy. The claim was denied because his UIM limit of $100,000 per bodily injury had been met by the driver's insurance policy.
Baldassano filed a complaint alleging that High Point 's agent failed to advise him of “the availability of higher UIM limits, the nature of UIM insurance, and other important information.” The Superior Court entered summary judgment in favor of the insurer. The case is Badassano v. High Point Insurance Company, 2007 WL 3287373 (N.J.Super.A.D.).
The agent had provided coverage for Baldassano's family and told him that he would “put him on“ the same type of policy. Baldassano agreed. The agent mailed a coverage selection form with the boxes already checked, reflecting $100,000/300,000 limits of liability and UIM coverage. Baldassano claims that he relied on the agent's representation in purchasing the policy. Baldassano maintained that the agent failed to advise him or to explain that various other limits were available. He contends that if he had been properly advised of the coverage choices and the availability of higher UIM coverage, he would have purchased it.
The court found that Baldassano had renewed the policy twelve times without changing coverage or inquiring whether other options were available even after contacting the agent to transfer coverage to new vehicles in 2000 and 2003. The court ruled, that by signing and returning the form with automobile policy coverage limits selected by the agent, the insured “completed and executed” it within the meaning of the statute, providing prima facie evidence of the named insured's knowing election or rejection of any option. Thus, the insurer was immune from liability for selection of underinsured motorist limits.
In deciding this issue, the court focused on the coverage selection form on which the agent checked the coverage selections.
Baldassano contended this was a failure to comply with the statutory requirements to qualify for immunity because the agent, not the insured, selected the level of UIM coverage on the coverage selection form. High Point argued that it met the statutory requirements for immunity because (1) the insured was not required to check the boxes himself; and (2) new coverage selection forms and buyer's guides were sent to the insured with each of the twelve renewals.
To be protected, an insurer must show that: (1) the insured's coverage limits were at least the minimum coverage required by law; (2) the insured's alleged damages were not caused by a “willful, wanton or grossly negligent act of commission or omission;“ and (3) the carrier complied with the coverage selection requirements. An insurer's proof of mailing the required materials establishes the presumption of receipt.
Baldassano claimed that the insurer failed to comply with the third prong, because the insured, not the agent, must “complete” the coverage selection form by physically marking off the limits that apply; and (2) the insured must “execute” the coverage selection form by signing it.
The court ruled that “When the insured signs an application with the boxes checked, it is completed…. There's no case that says that an insured himself must complete or fill out the form. It says complete and execute.“