In Abrohams v. Atlantic Mutual Insurance Agency, 638 S.E.2d 330, the Georgia Court of Appeals found that undisputed facts established that Richard Abrohams and his minor son, David, were injured in an automobile collision on December 28, 2002, and that David Abrohams' injuries are permanent in nature. The parties stipulated that liability for the collision rested solely with the driver of the vehicle that collided with Abrohams.
At the time of the collision, Abrohams was the named insured under an Atlantic Mutual homeowner policy, an auto policy, and a personal umbrella policy. Abrohams' claims were resolved by settlement with the at-fault driver's insurance company and from Abrohams' UM coverage under the auto policy. The value of David Abrohams' claim exceeded $1,450,000. Although David received benefits from the at-fault driver's policy and proceeds from the UM coverage contained in his parents' automobile policy, the value of his claim exceeded the limits of those policies. The Abrohams' auto policy provided $500,000 in UM coverage. The at-fault driver's policy contained minimum limits.
Abrohams sought UM benefits from Atlantic Mutual under their umbrella policy which provided $1 million in excess liability coverage. However, the umbrella policy did not offer UM coverage. Abrohams had never rejected such coverage.
Georgia law provides that no “automobile liability policy” may be issued unless it contains provisions for UM coverage. The statute further provides that “the insured may affirmatively choose uninsured motorist limits in an amount less than the limits of liability.” This coverage “shall not be applicable where any insured named in the policy shall reject the coverage in writing.”
Abrohams argued that they are entitled to $1 million in UM coverage under their umbrella policy because they were never offered, nor did they reject, such coverage.
The court concluded that had the legislature intended to limit the application of the law to primary policies only, it could easily have done so. The use of the plural term “policies” in the statute arguably suggests that the legislature intended the UM statute to apply to umbrella liability policies. The court found nothing to suggest that the legislature intended to limit UM protection. The law specifically requires that, without a written waiver, all automobile policies provide UM coverage equal to the policies' overall liability limits.
Atlantic Mutual further argued that even if the uninsured motorist law requires umbrella policies to provide UM coverage, the Abrohams' policy was a renewal and therefore exempt from the UM statute. The court disagreed.
The law provides that coverage need not be increased in a renewal policy from the amount shown on the declarations page for coverage existing prior to July 1, 2001 once coverage is issued. However, the Abrohams had never been offered nor had they declined UM coverage as part of their umbrella policy, either before or after July 1, 2001.
Minimum coverage was the default when Atlantic Mutual initially issued the Abrohams' policy. “Under Georgia law, a company is free to fix the terms of its policies as it sees fit, so long as they are not contrary to the law.” However, provisions in policies that conflict with the plain terms of Georgia 's insurance statutes are illegal and of no effect.
The uninsured motorist law requires that insurers provide UM coverage in umbrella policies that provide automobile and motor vehicle liability insurance. The provision in the Abrohams' umbrella policy, which specifically excluded UM coverage, was therefore void.
For the foregoing reasons, the judgment of the trial court was reversed, and the case was remanded to the superior court for entry of judgment consistent with this opinion.