The Validity of Forms Rejecting Uninsured Motorist (UM) Coverage
After an auto accident, one of the first questions to ask is what insurance coverage may be available to help with a car rental, medical expenses, lost wages, and other damages you incurred in the accident. Uninsured motorist or “UM” coverage protects you from the risk that the other driver whose negligence injured you may not be carrying enough insurance to completely compensate you for your injuries. We have written previously on this blog about the benefits of having UM coverage.
What about when you are uncertain whether you have waived UM coverage? If you have automobile liability insurance contracted in Louisiana, your insurance company generally is required by law automatically to also provide UM coverage to you. But if you have signed a valid written waiver rejecting UM coverage, a Louisiana court will enforce the waiver against you, and there will be no UM coverage. Still, in light of a Louisiana public policy of compensating auto accident victims, courts will sometimes find an existence of UM coverage even when the insured tried to waive UM coverage, on the basis that the waiver was invalid.
In 2022, in the case of Havard v. Jeanlouis, 2021-810 (La. 6/29/22), 345 So. 3d 1005, the Louisiana Supreme Court found that a UM waiver was invalid because the form was not executed according to the procedures required by Louisiana law. In Havard, an injured employee filed a UM claim against his employer’s insurance company. The employer and the insurance company believed that a stamped signature of the company’s owner on the form validly waived UM coverage. The employee argued, however, that the stamped signature was invalid because the company owner’s administrative assistant had affixed the signature to the waiver form without the owner’s written permission. In a split decision, with three justices dissenting, four Supreme Court justices agreed with the injured employee.
The Court held that because the company owner had not given his administrative assistant prior authority in writing to sign the UM waiver form, the stamped signature on the form was without legal effect. The Court reasoned, “Concerns over the practical impact within the insurance industry in scrutinizing stamped signed UM forms are unavailing. Inconvenience is not an absurdity. The insurer has the authority, opportunity, and responsibility to assure the UM form is completed properly.” Under the Court’s ruling, the injured employee was allowed to seek UM benefits to compensate for his injuries in the accident.
The views of the dissenting justices in Havard demonstrate how challenging it was for the Court to reach a decision. One justice called the majority decision “hypertechnical,” particularly when “it seems unjust to force the insurance company to provide coverage under a UM policy for which it received no premium. No one should get something for nothing in this circumstance–especially when it was something not wanted, not paid for, and specifically rejected.”
This recent Louisiana Supreme Court decision shows that insurance forms cannot always be taken at face value. While we strongly recommend knowing before an accident occurs whether you have UM coverage, if you are injured in an accident and you have a question about whether you (or your employer) waived UM coverage, we recommend that you contact an attorney for advice concerning your rights.