In Linda Connors, Individually, et al v. Government Employees Insurance Company, the Court of Special Appeals affirmed the circuit court’s grant of summary judgment in favor of GEICO, holding that GEICO insurance policy’s “clear and unambiguous language” restricts GEICO’s underinsured motorist policy obligation to appellants collectively at $100,000.00. The intermediate appellate court arrived at the $100,000.00 figure by offsetting GEICO’s “per occurrence” limit of $300,000.00 by the $200,000.00 previously paid to appellants through the tortfeasor’s insurance policy.
On April 14, 2009, spouses Linda and Robert Connors were walking in a residential area when the tortfeasor backed out of a driveway and hit them with his car. Mrs. Connors suffered minor injuries, while Mr. Connors unfortunately passed away from his injuries during the pendency of litigation. The tortfeasor’s insurance company readily paid out its full applicable policy limits of $100,000.00 per person/$300,000.00 per occurrence, paying $200,000.00 total for the incident.
Mr. and Mrs. Connors were both “insureds” under a motor vehicle policy issued by GEICO, which provided uninsured and underinsured motorist coverage with policy limits of $300,000.00 per person/$300,000.00 per occurrence. Following their settlement with the tortfeasor’s insurance company, the Connors filed a claim with GEICO seeking additional recovery. Rather than seek the remaining $100,000.00 available to them (subtracting the $200,000.00 they received from the tortfeasor from their $300,000.00 per occurrence GEICO underinsured motorist policy as GEICO did when it tendered payment of $100,000.00 to them), they sought the full amount of $300,000.00. To arrive at that number, the appellants argued that the “per occurrence” language capping their recovery at $300,000.00 was subservient to the “per person” limit of $300,000.00 and that the offset calculations should begin in the amount of $600,000.00. The appellants then argued that GEICO should receive credit for the $200,000.00 from the tortfeasor’s liability policy, leaving $400,000.00, and only then should the $300,000.00 “per occurrence” limit come into play, thus permitting them to a total recovery from GEICO of $300,000.00
As expected, GEICO argued that its underinsured motorist policy language is “clear and unambiguous,” and that the “per occurrence” limit applies to claims of two or more people, and is to be reduced by all amounts paid by the tortfeasor, in aggregate.
After a brief recitation of underinsured motorist law in Maryland, the Court of Special Appeals went above and beyond what was necessary to defeat appellants’ nonsensical argument. Analysing both contract construction and Maryland’s longstanding “gap theory” on underinsured motorist coverage, the Court affirmed the circuit court’s grant of summary judgment in favor of GEICO, holding that “the clear and unambiguous language of the GEICO insurance policy leaves GEICO with a remaining obligation to appellants of $100,000.00,” which had been satisfied in appellants previous settlement with the tortfeasor’s insurance company.