Court: 'Poorly written' policy means State Farm on hook for $4M for 'stacked' fleet vehicle coverage

By John Sammon | Dec 7, 2018

GFDL (, CC-BY-SA-3.0 ( or CC BY 2.5 (], via Wikimedia Commons

MOUNT VERNON –  A state appeals court has ruled a man injured in a car accident could claim up to $4 million in underinsured motorist coverage under his employer's policy, rather than $250,000, because his employer maintained a fleet of 16 vehicles, and the total policy should include the full fleet, not just one car at a time, because the policy was "poorly written" and "ambiguous."

The Illinois Fifrth District Appellate Court in downstate Mount Vernon on Nov. 29 affirmed an earlier Franklin County Circuit Court summary judgment against State Farm Insurance, granting a plaintiff $4 million in underinsured coverage after the Illinois man suffered a traffic accident on the job.

Officials of State Farm had claimed there should be only $250,000 in underinsured motorist coverage available.

Justices Richard Goldenhersh, Thomas Welch and Judy Cates presided in the case. Goldenhersh wrote the opinion.

Illinois Fifth District Appellate Court  

On Oct. 17, 2014, plaintiff Bennie Barlow was driving a pickup truck owned by his employer, Enviro-Tech, when he was rear-ended by another driver, Sebastian Dionne. Thework truck was insured by State Farm.

Dionne was covered by a policy through Safe Auto with a limit of $20,000. The plaintiff’s injuries exceeded that amount.

Barlow made an underinsured motorist claim against State Farm, but the insurance company initially denied coverage because the plaintiff was also covered under workers' compensation insurance. State Farm officials argued that the amount of the workers' comp exceeded a $250,000 underinsured motorist policy limit.

The attorney for the plaintiff agreed State Farm was entitled to a set-off amount for money paid by workers' compensation, but continued with the underinsured claim against State Farm.

The parties eventually filed cross-motions for summary judgment.

The plaintiff argued that the State Farm policy as written was ambiguous as to the limit of coverage it provided and he should be allowed to “stack” coverage for all 16 vehicles in his employers’ fleet for a total of $4 million.

Attorneys for State Farm argued its policy contained unambiguous stacking language and, although premiums were listed separately for each of the 16 vehicles, did not render the policy ambiguous.

The Appellate Court opinion noted that the policy did not contain the word “stacking” but instead contained the word “limits” which was referred to as an anti-stacking clause.

Enviro-Tech paid 16 separate insurance premiums for underinsured motorist coverage, Goldenhersh noted in the court opinion. The letter served as a key on the policy denoting underinsured coverage and was repeated 16 times.

“...This creates an ambiguity which can reasonably be interpreted as favoring aggregation of the 16 vehicles liability limits for underinsured motorist coverage,” Goldenhersh wrote.

Thus, the multiple listed coverage limits on the policy created ambiguity despite claims it was an anti-stacking provision.

“When the contents of the body of the policy conflict with the language on the declarations pages, an ambiguity exists that must be construed in favor of the insured,” Goldenhersh wrote.

The court concluded the policy was "poorly written" and contained inconsistent provisions, and that State Farm was responsible for its wording.

Barlow was represented by William A. Alexander and Matthew H. Caraway of Sam C. Mitchell & Associates in Frankfort.

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Franklin County Circuit Court Illinois Fifth District Appellate Court Sam C Mitchell & Assoicates

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