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App.", "case_ids": [ 8521104 ], "year": 1993, "pin_cites": [ { "page": "155" } ], "opinion_index": 0, "case_paths": [ "/nc-app/113/0152-01" ] } ], "analysis": { "cardinality": 1007, "char_count": 30671, "ocr_confidence": 0.746, "pagerank": { "raw": 2.619619904073761e-07, "percentile": 0.8212206580383644 }, "sha256": "f12c5b086a95461b1176108a1673570f97213b2c8c49e4396b1be71ee88de833", "simhash": "1:2f5fc272a75d15ea", "word_count": 4947 }, "last_updated": "2023-07-14T22:14:42.837437+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [], "parties": [ "DALLAS L. ISENHOUR, and wife, SANDRA K. ISENHOUR v. UNIVERSAL UNDERWRITERS INSURANCE COMPANY, and UNIVERSAL UNDERWRITERS GROUP" ], "opinions": [ { "text": "FRYE, Justice.\nOn 29 April 1989, plaintiff Dallas Isenhour was injured when the vehicle he was operating collided with a vehicle driven by Willie Kate Clark. The vehicle Mr. Isenhour was operating was owned by his employer, Far East Motors, Inc. [hereinafter Far East Motors], and was a covered automobile under a multiple-coverage fleet insurance policy purchased by Far East Motors. The fleet policy was issued by defendants, Universal Underwriters Insurance Company and Universal Underwriters Group [hereinafter Universal].\nOn 12 March 1990, Dallas and Sandra Isenhour instituted an action against Willie Kate Clark for damages for personal injuries sustained in the accident. In the complaint, the Isenhours alleged, among other things, negligence in failing to keep a proper lookout and driving in a reckless manner. Mr. Isenhour asserted a claim for serious, painful, and permanent bodily injuries causing medical and other expenses and decreased earning capacity. Mrs. Isenhour asserted a claim for loss of consortium. At the time of the accident, both Clark and the Isenhours were insured by Nationwide Mutual Insurance Company [hereinafter Nationwide] under nonfleet personal automobile insurance policies.\nThe Isenhours\u2019 policy with Nationwide insured three vehicles and carried underinsured motorists (UIM) coverage limits of $100,000 per person/$300,000 per accident with a separate premium being paid for each vehicle. Ms. Clark\u2019s policy with Nationwide provided liability coverage limits of $50,000 per person/$100,000 per accident. On 11 July 1991, Nationwide paid to the Isenhours $50,000, the per-person liability limit under the Clark policy. Additionally, the Isenhours settled for $25,000 under the UIM portion of their Nationwide policy.\nThereafter, plaintiffs\u2019 attorney notified Universal of the Isenhours\u2019 intent to seek \u201cadditional compensation\u201d under the UIM coverage in Far East Motors\u2019 policy with Universal. In a 17 July 1991 letter, plaintiffs\u2019 attorney informed Universal of his clients\u2019 demand for settlement of $1,200,000 and sent Universal copies of the complaint and other pertinent documents.\nOn 1 October 1991, plaintiffs\u2019 attorney notified Universal that the case was set on the 14 October 1991 trial calendar. Universal did not appear for trial. Universal sent plaintiffs\u2019 attorney a letter dated 31 January 1992 in which it denied it was a party to the suit and produced its insurance policy for review.\nThe trial court entered judgment in the underlying action against Ms. Clark on 10 March 1992 in the amount of $750,000 for Mr. Isenhour and $150,000 for Mrs. Isenhour. The judgment stated that the parties had waived trial by jury and specific findings of fact and conclusions of law and provided that the plaintiffs could recover from Ms. Clark to \u201cthe extent of underinsured motorist\u2019s [sic] coverage provided by an underinsured motorist carrier other than Nationwide Mutual Insurance Company,\u201d as per a partial release negotiated by the parties. This partial release limited Nationwide\u2019s total liability under the Clark and Isenhour policies to $75,000, the total amount of the settlement.\nIn a letter dated 12 May 1992, Universal notified plaintiffs\u2019 attorney that the maximum that might be available to the Isenhours under the Far East Motors fleet policy was $60,000 and that an umbrella provision in the policy did not apply to the Isenhours\u2019 claim. Universal explained that the coverage parts for the underlying policy and the umbrella policy were separate and distinct forms of coverage, adding that UIM coverage is added to the umbrella policy only by specific endorsement. Universal stated that only $60,000 in UIM coverage existed via specific endorsement and that no UIM coverage had been endorsed onto the umbrella provision. Accordingly, Universal tendered $60,000 in settlement of the UIM claim under its fleet policy.\nOn 8 June 1992, the Isenhours filed suit against Universal alleging (1) gross negligence, (2) unfair and deceptive acts or practices in violation of N.C.G.S. \u00a7 58-63-15(11) and N.C.G.S. \u00a7 75-16, and (3) liability by virtue of N.C.G.S. \u00a7 20-279.21(b)(4). Universal filed its answer on 23 July 1992, denying liability and defending on the basis that (1) the policy is a fleet policy under N.C.G.S. \u00a7 20-279.21(b)(4) and cannot be stacked onto a nonfleet policy; (2) plaintiffs are not insureds under the policy; and (3) Universal was not a party to the underlying action against Clark, did not participate in the settlement agreement, and cannot be bound by that agreement.\nUniversal moved for summary judgment on 25 August 1992. Universal submitted two affidavits in support of its motion for summary judgment. In the first affidavit, Universal\u2019s underwriting manager stated that Universal\u2019s policy issued to Far East Motors was a fleet policy that insured a multiple and changing number of motor vehicles used in Far East Motors\u2019 business. In the second affidavit, Nationwide, which had issued policies to both Clark (the tort-feasor) and the Isenhours, stated that both policies were nonfleet personal automobile insurance policies.\nOn the basis of these two affidavits and the Court of Appeals\u2019 decision in Watson v. American Nat\u2019l Fire Ins. Co., 106 N.C. App. 681, 417 S.E.2d 814 (1992), aff\u2019d, on other grounds, 333 N.C. 338, 425 S.E.2d 696 (1993), the trial court granted summary judgment in favor of Universal and dismissed the Isenhours\u2019 claims on 10 November 1992. From the entry of summary judgment, plaintiffs appealed to the Court of Appeals.\nThe Court of Appeals held that its decision in Watson \u201cbar[red] the coverage sought in this case and [that] the trial court correctly granted summary judgment.\u201d Isenhour v. Universal Underwriters Ins. Co., 113 N.C. App. 152, 155, 437 S.E.2d 702, 704 (1993). We allowed plaintiffs\u2019 petition for discretionary review, and we now reverse the decision of the Court of Appeals which affirmed the trial court\u2019s entry of summary judgment in favor of defendants.\nDefendants contend that the Court of Appeals properly affirmed the trial court\u2019s entry of summary judgment because the trial court and the Court of Appeals correctly applied the Court of Appeals\u2019 decision in Watson. We disagree.\nIn Watson, the Court of Appeals held that \u201cfleet policies may not be stacked onto nonfleet policies\u201d under N.C.G.S. \u00a7 20-279.21(b)(4). Watson, 106 N.C. App. at 686, 417 S.E.2d at 818. The Court of Appeals stated that\nthe appellee\u2019s policy is a fleet policy under Sutton [v. Aetna Casualty & Surety Co., 325 N.C. 259, 382 S.E.2d 759, reh\u2019g denied, 325 N.C. 437, 384 S.E.2d 546 (1989)] and excluded from inter-policy stacking, since the stacking provisions of N.C.G.S. \u00a7 20-279.21(b)(4) cover only nonfleet private passenger motor vehicle insurance. Aetna Casualty and Sur. Co. v. Fields, 105 N.C. App. 563, 414 S.E.2d 69 [, disc. rev. denied, 331 N.C. 383, 417 S.E.2d 788] (1992). We recognize that inter-policy stacking is permitted so as to provide the innocent victim of an inadequately insured driver with an additional source of recovery; however, to allow stacking of a victim\u2019s fleet policy onto the nonfleet policy of the insured-tortfeasor is a result contemplated neither by the insurer when it wrote the fleet policy nor the legislature when it wrote the statute. We therefore hold that under N.C.G.S. \u00a7 20-279.21(b)(4) fleet policies may not be stacked onto nonfleet policies.\nWatson, 106 N.C. App. at 686, 417 S.E.2d at 818.\nThis Court granted discretionary review of Watson and affirmed the Court of Appeals\u2019 decision on grounds different from those articulated by the Court of Appeals. Watson v. American Nat\u2019l Fire Ins. Co., 333 N.C. 338, 425 S.E.2d 696 (1993). We determined that the insurance policy at issue was exempt, via N.C.G.S. \u00a7 20-279.32, from the requirements of the Financial Responsibility Act, since the vehicle involved was operating under a certificate of convenience and necessity issued by the Interstate Commerce Commission. Accordingly, the plaintiff was entitled to \u201conly such coverage as is provided in the policy.\u201d Id. at 340, 425 S.E.2d at 697. We noted that \u201c[b]y its plain words N.C.G.S. \u00a7 20-279.32 says that N.C.G.S. \u00a7 20-279.21(b)(4) does not apply in this case.\u201d Id. The present case differs from Watson because N.C.G.S. \u00a7 20-279.21(b)(4) is applicable.\nThis Court stated clearly in Sutton v. Aetna Casualty & Surety Co., 325 N.C. 259, 382 S.E.2d 759, reh\u2019g denied, 325 N.C. 437, 384 S.E.2d 546 (1989), that no reason exists to distinguish between fleet and nonfleet policies under interpolicy stacking. Accordingly, we disavow the language of the Court of Appeals in Watson that the stacking provisions of N.C.G.S. \u00a7 20-279.21(b)(4) cover only nonfleet vehicle insurance. Under Sutton, the interpolicy stacking of fleet and non-fleet policies is permissible. Therefore, the Court of Appeals erred by relying on its holding in Watson in holding that the coverage sought by the Isenhours was barred.\nWe now proceed to the second issue, which is a matter of first impression for this Court. The issue is whether a multiple-coverage fleet insurance policy which includes umbrella coverage must offer UIM coverage equal to the liability limits under its umbrella coverage section.\nWe begin by looking at the nature and purpose of umbrella coverage. It is a form of insurance protection against losses in excess of the amount covered by other liability insurance policies. It provides coverage above basic or normal limits of liability. Black\u2019s Law Dictionary 808 (6th ed. 1990). The umbrella portion of the policy in this case, for example, provides in the insuring agreement that the insurer will pay for loss in excess of coverage provided in any underlying insurance; coverage provided in any other insurance available to an insured; and in the absence of such coverage, the retention shown in the declarations in the policy. As noted by John A. and Jean Appleman:\nUmbrella policies serve an important function in the industry. In this day of uncommon, but possible, enormous verdicts, they pick up this exceptional hazard at a small premium. Assuming one\u2019s automobile . . . polic[y] [has] liability limits of $100,000 or even $500,000, the umbrella policy may pick up at that point and cover for an additional million, five million, or ten million.\n8C Appleman, Insurance Law and Practice \u00a7 5071.65 (1981).\nOur analysis in this case is aided by a very recent decision of the New Jersey Supreme Court, which noted a split of authority among courts considering the issue. See Doto v. Russo, 140 N.J. 544, 659 A.2d 1371 (1995). States with statutes requiring insurers to write UM/UIM coverage only to the statutory minimum of liability coverage have held that such statutes do not apply to umbrella provisions. See Continental Ins. Co. v. Howe, 488 So. 2d 917 (Fla. Dist. Ct. App.) (construing Rhode Island law), disc. rev. denied, 494 So. 2d 1151 (Fla. 1986); Moser v. Liberty Mut. Ins. Co., 731 P.2d 406 (Okla. 1986). The Kansas Supreme Court has noted that the rationale behind this position is that the amount of liability coverage is irrelevant if UM/UIM coverage is only required in a minimum amount and that minimum is met. See Bartee v. R.T.C. Transp., Inc., 245 Kan. 499, 511, 781 P.2d 1084, 1092 (1989).\nOn the other hand, states with statutes requiring UM/UIM coverage limits equal to those of liability coverage have held that such statutes are applicable to umbrella provisions. See St. Paul Fire and Marine Ins. Co. v. Gilmore, 168 Ariz. 159, 812 P.2d 977 (1991); Chicago Ins. Co. v. Dominguez, 420 So. 2d 882 (Fla. Dist. Ct. App. 1982), disc. rev. denied, 430 So. 2d 450 (Fla. 1983); First State Ins. Co. v. Stubbs, 418 So. 2d 1114 (Fla. Dist. Ct. App. 1982), disc. rev. denied, 426 So. 2d 26 (Fla.) and disc. rev. denied, 426 So. 2d 29 (Fla. 1983); Cohen v. American Home Assur. Co., 367 So. 2d 677 (Fla. Dist. Ct. App.), cert. denied, 378 So. 2d 342 (Fla. 1979); Bartee v. R.T.C. Transp., Inc., 245 Kan. 499, 781 P.2d 1084; Southern Am. Ins. Co. v. Dobson, 441 So. 2d 1185 (La. 1983); Doto v. Russo, 140 N.J. 544, 659 A.2d 1371; House v. State Auto. Mut. Ins. Co., 44 Ohio App. 3d 12, 540 N.E.2d 738, appeal dismissed, 37 Ohio St. 3d 704, 531 N.E.2d 1316 (1988); Cincinnati Ins. Co. v. Siemens, 16 Ohio App. 3d 129, 474 N.E.2d 655 (1984) (Table No. 88-659).\nOur analysis is further aided by a decision of the United States District Court for the Northern District of Ohio which construed North Carolina law with regard to the issue of whether an excess liability umbrella policy must offer UM/UIM coverage. In Krstich v. United Services Auto. Ass\u2019n, 776 F. Supp. 1225 (N.D. Ohio 1991), the court found that the umbrella policy at issue \u201cwould be required to provide uninsured coverage under [North Carolina] law,\u201d since the policy was \u201ca \u2018policy of bodily injury liability insurance\u2019 which covers \u2018liability arising out of the ownership, maintenance, or use\u2019 of a motor vehicle.\u201d Id. at 1234 (quoting N.C.G.S. \u00a7 20-279.21(b)(3) (Supp. 1988)). The court concluded that \u201c[b]y operation of \u00a7 20-279.21(b)(3), it must, therefore, provide uninsured motorist coverage.\u201d Id. The court further concluded that the defendant was obligated to \u201cprovide underinsured motorist coverage \u2018in an amount equal to the policy limits for automobile bodily injury liability as specified in the owner\u2019s policy,\u2019 \u201d since the umbrella policy therein \u201cexceeded] the limits of subsection (b)(2) and . . . contained] uninsured coverage as required by subsection (b)(3).\u201d Id. (quoting N.C.G.S. \u00a7 20-279.21(b)(4)). The court found that \u201c[u]nderinsured coverage is, therefore, mandatory in the amount of the liability policy\u2019s limit, here $1,000,000, pursuant to subsection (b)(4).\u201d Id.\nUnder our statute, the policyholder is entitled to UM/UIM coverage only if the policyholder elects liability coverage above the statutory minimum. See N.C.G.S. \u00a7 20-279.21(b)(3), (b)(4). In Sutton, we said that \u201c[a]n owner\u2019s policy of liability insurance must, subject to rejection by the insured, provide UIM coverage \u2018only with policies that are written at limits that exceed\u2019 minimum statutory limits and that afford uninsured motorist coverage.\u201d Sutton, 325 N.C. at 268, 382 S.E.2d at 765 (quoting N.C.G.S. \u00a7 20-279.21(b)(4) (Supp. 1988)). Under the version of our statute applicable to this case, if these statutory prerequisites for UIM coverage are met, the policyholder is entitled to UIM coverage \u201cin an amount equal to the policy limits for automobile bodily injury liability as specified in the owner\u2019s policy.\u201d N.C.G.S. \u00a7 20-279.21(b)(4) (Supp. 1988). Because the statute links the amount of UIM coverage to the amount of liability coverage, the increase of liability coverage through umbrella coverage provisions will naturally cause an insurer to offer UIM coverage in a higher amount. This result is in accord with the manifest purpose of the Financial Responsibility Act in North Carolina, which is to protect innocent victims who have been injured by financially irresponsible motorists. Nationwide Mut. Ins. Co. v. Chantos, 293 N.C. 431, 238 S.E.2d 597 (1977).\nAccordingly, we hold that Universal was required to offer Far East Motors UIM coverage in the umbrella section of the fleet policy. The umbrella coverage section of the policy provided automobile bodily injury liability coverage in the amount of $2,000,000. Therefore, Universal was required to offer Far East Motors $2,000,000 in UIM coverage.\nWhen a statute is applicable to the terms of an insurance policy, the provisions of the statute become a part of the policy, as if written into it. If the terms of the statute and the policy conflict, the statute prevails. Sutton, 325 N.C. 259, 382 S.E.2d 759; Chantos, 293 N.C. 431, 238 S.E.2d 597.\nUnder N.C.G.S. \u00a7 20-279.21(b)(4), the UIM coverage is the same as the policy limits for automobile liability unless the insured has rejected such insurance or selected a different limit, and this rejection or selection must be in writing. Proctor v. N.C. Farm Bureau Mut. Ins. Co., 324 N.C. 221, 376 S.E.2d 761 (1989).\nIn the present case, there is no evidence in the record that Far East Motors either rejected in writing UM or UIM coverage for the umbrella section of the policy or selected a different limit. Therefore, the umbrella section of the policy provides UIM coverage of $2,000,000, \u201can amount equal to the policy limits for automobile bodily injury liability as specified in the owner\u2019s [umbrella coverage section of the] policy,\u201d N.C.G.S. \u00a7 20-279.21(b)(4); accord Proctor, 324 N.C. 221, 376 S.E.2d 761.\nUnder N.C.G.S. \u00a7 20-279.21(b)(3) and (b)(4), there are two classes of \u201cpersons insured\u201d:\n(1) the named insured and, while resident of the same household, the spouse of the named insured and relatives of either and (2) any person who uses with the consent, express or implied, of the named insured, the insured vehicle, and a guest in such vehicle.\nSmith v. Nationwide Mut. Ins. Co., 328 N.C. 139, 143, 400 S.E.2d 44, 47, reh\u2019g denied, 328 N.C. 577, 403 S.E.2d 514 (1991). Members of the first class are \u201cpersons insured\u201d for purposes of UM/UIM coverage regardless of whether the insured vehicle is involved in their injuries. Id. Members of the second class are \u201cpersons insured\u201d only when the insured vehicle is involved in the insured\u2019s injuries. Id.\nTurning to the present case, there is no contention that the Isenhours are persons insured of the first class under the Universal policy. The question becomes whether the Isenhours are \u201cpersons insured\u201d of the second class under the UIM provisions of the Far East Motors fleet policy with Universal. It is undisputed that Mr. Isenhour was occupying a covered automobile owned by Far East Motors, the insured, and that Mr. Isenhour was using the automobile with the permission of Far East Motors when he was struck by the automobile driven by Ms. Clark. Thus, Mr. Isenhour is a person insured of the second class for UIM purposes and, accordingly, is entitled to coverage under the umbrella section of the fleet policy pursuant to N.C.G.S. \u00a7 20-279.21(b)(3) and (b)(4).\nHowever, Mrs. Isenhour was not a person insured of the second class under the Universal policy. She was neither using the insured vehicle nor a guest in the vehicle at the time of the accident. Therefore, she is not entitled to UIM coverage under the Universal policy.\nThe final issue on this appeal is whether Mr. Isenhour\u2019s failure to exhaust the UIM limits of his Nationwide policy precludes his claim against Universal. The Universal fleet policy providing UIM coverage contained the following clause in its endorsement:\nMost We Will Pay\nWe will pay under this endorsement only after the limits of any other applicable insurance policies or bonds have been exhausted by payment of judgments or settlements.\nUniversal contends that because Mr. Isenhour failed to claim all of the available UIM coverage under the Nationwide policy, he should be precluded from recovery under the Far East Motors policy. The Isenhours entered into a settlement agreement for $50,000 of liability coverage under the tort-feasor\u2019s Nationwide policy and $25,000 of UIM coverage under their personal Nationwide policy. The agreement purported to release the tort-feasor from any and all liability and further released Nationwide from any UIM claims by the Isenhours. Defendants here contend that because the Isenhours did not exhaust the limits of their UIM coverage under their Nationwide policy in the settlement agreement, Mr. Isenhour should not be allowed any recovery pursuant to the above endorsement.\nWe do not agree with Universal\u2019s contentions. The exhaustion requirement in Universal\u2019s \u201cMost We Will Pay\u201d clause relates to \u201capplicable\u201d insurance policies or bonds, such as liability insurance or UIM coverage of a lower tier than the insurance in question. Universal\u2019s obligation to pay under its UIM coverage does not arise until all sums available under any liability policies or bonds and any other UIM coverage which is of a lower tier has been exhausted. Universal does - not argue that any liability policies and bonds have not been exhausted, but contends that the competing Nationwide UIM limits have not been exhausted. We agree, but this does not decide the issue before us.\nIn deciding this issue, we must first determine which policy provides primary coverage. If one policy provides primary coverage while the other provides excess coverage, then we must determine whether the primary policy is sufficient to satisfy Mr. Isenhour\u2019s $750,000 judgment. If the primary policy limits are sufficient to fully satisfy the judgment, no stacking issue arises in this case. On the other hand, if the policy providing primary coverage is not sufficient to satisfy the judgment, the fact that one policy is fleet and the other nonfleet would not prohibit stacking the primary and excess coverage under the two policies so as to provide full payment of the judgment. See Sutton, 325 N.C. 259, 382 S.E.2d 759.\nHere, we have two policies providing UIM coverage issued by different companies to different policyholders. \u201cThe liability of each company must be determined by the terms of its own policy, subject to such modification as may be imposed by statute or by authorized administrative regulation or order.\u201d Insurance Co. v. Insurance Co., 269 N.C. 341, 346, 152 S.E.2d 436, 440 (1967). To determine who is the primary carrier and who is the excess carrier, if any, we must examine the \u201cOther Insurance\u201d clauses in the competing policies. Id.\nThe Universal policy issued to Far East Motors provides in pertinent part:\nOther Insurance\nThe insurance afforded by the endorsement is primary, except it is excess for any Covered Auto not owned by the Insured or any trailer attached to it.\nBased on the plain language of the Far East Motors Universal policy, it provides primary coverage because the automobile that Mr. Isenhour was driving at the time of the accident was a covered automobile owned by Universal\u2019s insured, Far East Motors.\nThe Nationwide policy issued to the Isenhours provides in pertinent part:\nOther Insurance\n[A]ny insurance we provide with respect to a vehicle you do not own shall be excess over any other collectible insurance.\nBased on the plain language of the Isenhours\u2019 Nationwide policy, it provides excess coverage in this case, since the automobile Mr. Isenhour was driving at the time of the accident was not owned by him.\nAccordingly, we hold that Far East Motors\u2019 Universal policy provides primary coverage and the Isenhours\u2019 Nationwide policy provides secondary coverage. Therefore, the liability of Nationwide, the excess insurer, does not arise until the limits of the Universal policy, the primary coverage policy, have been exceeded. See Insurance Co. v. Insurance Co., 269 N.C. 341, 152 S.E.2d 436.\nIn support of its contention that Mr. Isenhour is precluded from recovery, Universal here cites Eaves v. Universal Underwriters Group, 107 N.C. App. 595, 421 S.E.2d 191, disc. rev. denied, 333 N.C. 167, 424 S.E.2d 908 (1992). In Eaves, Universal\u2019s garage liability policy contained a \u201cMost We Will Pay\u201d clause limiting its coverage to the minimum limits of the Financial Responsibility Act and an \u201cOther Insurance\u201d clause purporting to make its coverage excess over any other collectible insurance, while the competing policy issued by Arnica Mutual Insurance Company also contained an \u201cOther Insurance\u201d clause purporting to make its coverage excess for any vehicle the insured did not own where other insurance was available. Because Universal\u2019s policy effectively defined its policy limits to exclude liability in the event there was other collectible insurance which met the minimum standards set by the Financial Responsibility Act, the Court of Appeals held that Universal did not provide any coverage to the plaintiffs in that case.\nIn Eaves, the Court of Appeals relied on United Services Auto. Ass\u2019n v. Universal Underwriters Ins. Co., 332 N.C. 333, 420 S.E.2d 155 (1992). In United Services, this Court examined two policies to determine which of them provided liability coverage for the accident in question. In that case, it was \u201capparent that in defining the limits for which it would be liable for an occurrence involving a person required by law to be insured, Universal agreed to cover only what was needed to comply with the financial responsibility law.\u201d Id. at 336, 420 S.E.2d at 157. This Court concluded that because United Services provided the coverage required to comply with the Financial Responsibility Act, the Universal policy did not provide any coverage in that case.\nThe present case is distinguishable from both Eaves and United Services. In the present case, both Universal and Nationwide contracted to provide coverage under the circumstances of this case, notwithstanding the fact that one is primary and the other secondary. Further, unlike United Services and Eaves, Universal here did not define its policy limits to exclude liability in the event there was other collectible insurance which met the minimum standards set by the Financial Responsibility Act. Accordingly, neither United Services nor Eaves is dispositive in this case. Therefore, we reject Universal\u2019s contention that it was not required to pay until the Nationwide UIM policy limits were exhausted.\nSince the policy limits available in the Universal policy are sufficient to satisfy Mr. Isenhour\u2019s portion of the judgment, this is not a stacking case. This case involves a question of coverage. The primary coverage under the Universal policy exceeds the judgment of $750,000 in Mr. Isenhour\u2019s favor. Therefore, Mr. Isenhour could satisfy his entire judgment without resorting to the Nationwide policy.\nThus, Universal is not absolved of liability simply because the Isenhours settled with Nationwide for less than the UIM policy limits. Accordingly, we hold that Mr. Isenhour is entitled to satisfy his portion of the judgment from the Universal policy.\nFor the foregoing reasons, the decision of the Court of Appeals is reversed, and the case is remanded to the Court of Appeals for further remand to the trial court for further proceedings consistent with this opinion.\nREVERSED AND REMANDED.\n. This statute has been amended, and now requires an insurer to offer UIM coverage in an amount \u201cequal to the highest limit of bodily injury liability coverage for any one vehicle in the policy.\u201d N.C.G.S. \u00a7 20-279.21(b)(4) (1992).\n. This Court denied defendants\u2019 motion, made for the first time in this Court, to amend the record on appeal by introducing evidence of a purported rejection of such coverage by Far East Motors.", "type": "majority", "author": "FRYE, Justice." } ], "attorneys": [ "Pritchett, Cooke & Burch, by David J. Irvine, Jr., for plaintiff - appellants.", "Hutchins, Tyndall, Doughton & Moore, by Kent L. Hamrick, for defendant-appellees." ], "corrections": "", "head_matter": "DALLAS L. ISENHOUR, and wife, SANDRA K. ISENHOUR v. UNIVERSAL UNDERWRITERS INSURANCE COMPANY, and UNIVERSAL UNDERWRITERS GROUP\nNo. 47PA94\n(Filed 8 September 1995)\n1. Insurance \u00a7 528 (NCI4th)\u2014 automobile insurance \u2014 inter-policy stacking of fleet and nonfleet policies\nThe interpolicy stacking of fleet and nonfleet policies is permissible under N.C.G.S. \u00a7 20-279.2100(4).\nAm Jur 2d, Automobile Insurance \u00a7\u00a7 292, 329, 368, 432.\n2. Insurance \u00a7 533 (NCI4th)\u2014 multiple coverage fleet insurance \u2014 umbrella coverage \u2014 underinsured motorists coverage\nThe insurer of a multiple coverage fleet insurance policy which includes umbrella coverage must offer the insured under-insured motorists (UIM) coverage equal to the liability limits under the umbrella coverage section if above the statutory minimum, and where there is no evidence that the insured either rejected UIM coverage in writing for the umbrella section of the policy or selected a different limit, and the umbrella section provides bodily injury liability coverage of $2,000,000, the umbrella section of the policy provides UIM coverage pursuant to N.C.G.S. \u00a7 20-279.21(b)(4) in an amount equal to the $2,000,000 policy limits for bodily injury liability specified in the umbrella section.\nAm Jur 2d, Automobile Insurance \u00a7 322.\n\u201cExcess\u201d or \u201cumbrella\u201d insurance policy as providing coverage for accidents with uninsured or underinsured motorists. 2 ALR5th 922.\n3. Insurance \u00a7 527 (NCI4th)\u2014 automobile insurance \u2014 fleet policy \u2014 person insured of second class \u2014 UIM coverage\u2014 wife not in vehicle \u2014 no UIM coverage\nWhere plaintiff-driver was using his employer\u2019s automobile with the employer\u2019s permission at the time of an accident, and the employer\u2019s vehicle was insured under a fleet policy, plaintiff-driver is a person insured of the second class for UIM purposes and is thus entitled to UIM coverage under the umbrella section of the fleet policy. However, the driver\u2019s wife was not a person insured of the second class and was not entitled to UIM coverage under the fleet policy since she was neither using the insured vehicle nor a guest in the vehicle at the time of the accident. N.C.G.S. \u00a7 20-279.21(b)(4).\nAm Jur 2d, Automobile Insurnace \u00a7\u00a7 219, 258, 267, 320.\n4. Insurance \u00a7\u00a7 529, 547 (NCI4th)\u2014 driver of employer\u2019s vehicle \u2014 UIM coverage \u2014 primary fleet insurance exceeding judgment \u2014 settlement with personal insurer for less than UIM limit \u2014 fleet UIM insurance not affected\nWhere plaintiff was driving his employer\u2019s automobile at the time of an accident, the employer\u2019s automobile was insured under a fleet policy issued by defendant-insurer which contained an \u201cother insurance\u201d clause providing that such insurance was primary except for a covered vehicle not owned by the insured, and plaintiff was insured under a nonfleet personal policy containing an \u201cother insurance\u201d clause stating that the insurance provided for a vehicle not owned by the insured was excess, the employer\u2019s fleet policy provided primary UIM coverage and plaintiff\u2019s personal policy provided secondary UIM coverage for plaintiff\u2019s injuries. Therefore, where the fleet policy provided UIM coverage exceeding plaintiffs judgment against the tortfeasor, this is not a stacking case since plaintiff is entitled to satisfy his entire judgment from the fleet policy, and the employer\u2019s fleet insurer is not absolved of liability for UIM coverage because plaintiff settled with his personal insurer for an amount less than the UIM limit under his policy.\nAm Jur 2d, Automobile Insurance \u00a7 434.\nOn discretionary review pursuant to N.C.G.S. \u00a7 7A-31 of a unanimous decision of the Court of Appeals, 113 N.C. App. 152, 437 S.E.2d 702 (1993), affirming an order granting summary judgment for defendants entered 10 November 1992 by Burroughs, J., in Superior Court, Catawba County. Heard in the Supreme Court 16 February 1995.\nPritchett, Cooke & Burch, by David J. Irvine, Jr., for plaintiff - appellants.\nHutchins, Tyndall, Doughton & Moore, by Kent L. Hamrick, for defendant-appellees." }, "file_name": "0597-01", "first_page_order": 631, "last_page_order": 644 }