The plaintiffs, James and Theresa Howe, brought a declaratory action in Florida against their insurance companies, Valley Forge Insurance Co. [Valley Forge] and Continental Casualty Co. [Continental], seeking to establish that they had uninsured motorist coverage under their policies. The Howes, residents of Rhode Island, were injured in a car accident in Florida. The trial court ruled that coverage existed under both the Valley Forge primary policy and the Continental umbrella policy. Continental appeals, and, for the reasons which follow, we reverse.
The Continental policy at issue, a typical umbrella policy, provided coverage of $2,000,000 above the primary policy. Though Continental's policy did say that it did not provide uninsured motorist coverage, the Howes had not rejected the coverage in writing. The trial court found that, because Continental had not complied with Rhode Island law which requires uninsured motorist coverage to be rejected in writing, Continental was required to provide uninsured motorist coverage to the limits of its liability coverage, i.e., $2,000,000.
Because Florida is the forum state, we examine our conflicts law to determine which state's substantive law applies. Aetna Casualty & Surety Co. v. Diamond, 472 So.2d 1312 (Fla. 3d DCA 1985). In this case, because we are construing a Rhode Island insurance contract issued to Rhode Island residents, we apply Rhode Island law. Diamond, 472 So.2d at 1314; Aetna Casualty & Surety Co. v. Enright, 258 So.2d 472 (Fla. 3d DCA 1972).
The person driving the car which hit the Howes had liability insurance with limits of $10,000 per person/$20,000 per accident. Under Rhode Island law, a driver is required to have liability insurance of at least $25,000/50,000. If he has less than the minimum required, that driver is considered to be an uninsured motorist. Bibeault v. Hanover Insurance Co., 417 A.2d 313, 315 (R.I. 1980). Under Rhode Island law, therefore, the Howes were injured by an uninsured motorist. Thus, the Rhode Island statute requiring liability insurance policies to provide uninsured motorist coverage applies.
The Supreme Court of Rhode Island has held that, when uninsured motorist coverage is not offered in a primary liability policy, coverage arises by operation of law; however, the uninsured motorist coverage exists only to the minimum required by statute. American Universal Insurance Co. v. Russell, 490 A.2d 60 (R.I. 1985). The court reached this decision based upon its plain reading of its statutes. Section 31-31-7 of the General Laws of Rhode Island requires that motorists maintain a minimum level of liability insurance of $25,000/50,000. Section 27-7-2.1 of the General Laws of Rhode Island requires that insurance companies which provide liability policies must also provide uninsured motorist coverage. The court reasoned that, because the legislature requires drivers to maintain only a minimum level of liability insurance, therefore, the legislature likewise intended that drivers maintain only a minimum level of uninsured motorist insurance. Russell, 490 A.2d at 62; Ziegelmayer v. Allstate Insurance Co., 121 R.I. 818, 403 A.2d 653, 655 (1979). This approach has also been followed by courts in Alabama, Illinois, and New York, and by a federal court construing Delaware law. Those states all have similar statutes. All four courts have decided the precise question involved here and have held that such a statute does not apply to umbrella policies.
Three states, Florida, Ohio, and Louisiana, have construed their statutes to include umbrella policies. However, these states have a different type of statute. Section 627.727(2), Florida Statutes (1985),
Louisiana also has a statute requiring uninsured motorist coverage equivalent to the amount of liability insurance, and the Supreme Court of Louisiana has held that umbrella policies fall within the Louisiana statute. Southern American Insurance Co. v. Dobson, 441 So.2d 1185 (La. 1983); La. Rev. Stat. Ann. § 22:1406(D)(1)(a). The court recognized that its own decision and the Florida decisions were based on the difference in the statutes, i.e., that while other states have statutes designed to provide a minimum level of recovery, the statutes of Florida and Louisiana are designed to provide full recovery. The court noted that, if Louisiana's statute were similar to the statutes of Alabama, Delaware, Illinois, and New York, then it too would conclude that umbrella policies did not fall within the statute.
Ohio has a statute which is similar to those of Florida and Louisiana. In Cincinnati Insurance Co. v. Siemens, 16 Ohio App.3d 129, 474 N.E.2d 655 (1984), an Ohio appellate court concurred in the then-prevailing Florida view that an umbrella policy issuer was required to provide uninsured motorist coverage.
Because Rhode Island's statutory policy is the same as that found in those states which require only the minimum coverage, we think that Rhode Island's supreme court would also hold that an insurer who issues an umbrella policy is not required to provide uninsured motorist coverage. Rhode Island's legislative purpose of ensuring that an injured motorist can recover up to the minimum limits required by statute is satisfied by the underlying primary liability insurance.
Reversed and remanded.
Section 31-31-7 requires that insurance of $25,000/50,000 be maintained.