United States District Court,

E.D. Kentucky,

Central Division,

Lexington.

ZURICH AMERICAN INSURANCE COMPANY, Plaintiff,

v.

WESTFIELD INSURANCE COMPANY, et al., Defendants.

Civil Action No. 07-118-JBC.

Jan. 12, 2009.

MEMORANDUM OPINION AND ORDER

JENNIFER B. COFFMAN, Chief Judge.

This matter is before the court on the plaintiff’s motion for partial summary judgment (R. 60) and defendant Westfield’s motion for summary judgment (R. 62). The court, having reviewed the record and being otherwise sufficiently advised, will grant the motions in part and deny them in part.

I. Factual and Procedural Background

The plaintiff, Zurich American Insurance Company (“Zurich”), brought this action for declaration of rights seeking a determination that the defendant Westfield Insurance Company (“Westfield”) is wholly or partly responsible for the defense and indemnification of claims asserted in a lawsuit, Brace v. Merriett, Case No. 05-CI-3409, filed in Fayette Circuit Court, Fayette County, Kentucky. The underlying lawsuit arose out of a motor vehicle accident on April 10, 2003, in which Rob Brace was in a vehicle struck by a truck  driven by Thomas R. Merriett. Brace brought the state action against Merriett, Republic Industries (Merriett’s employer), Republic Welding Company, and Republic Industries International Inc.

1995 International truck, VIN 1HTSDAANOSH249127.

At the time of the accident, Republic Industries was a d/b/a of Republic Welding Company (“Republic Industries”). Republic Industries was insured through Zurich. Republic Diesel was a subsidiary or division of Republic Welding until it was sold in 2000. See R. 60-2, at 5 (quoting Deposition of Thomas Kinderman, at 9). Republic Diesel and its insurance company, Westfield, were not named as defendants in the state court action.

Since the April 10, 2003, accident, Republic Industries was sold and became Republic Industries International.

The state court complaint alleges that Merriett was acting within the scope of his employment at the time of the accident. Republic Industries holds paper title to the truck driven by Merriett. Merriett drove the truck to provide shuttle mining services on behalf of Republic Industries and Republic Diesel. The two companies shared the expenses of the shuttle truck, including the costs, maintenance, and driver’s salary. Republic Industries paid the expenses and Republic Diesel later reimbursed Republic Industries based on the proportion of sales attributable to each company. Despite the separation in ownership of Republic Diesel and Republic Industries, they continued to share the shuttle because customers continued to receive products and services from both companies.

A. Zurich Insurance Policy

Republic Welding and Republic Industries are insured through Zurich, including coverage entitled “  Commercial Auto Insurance.” Certain vehicles are listed specifically on the policy, but the truck driven by Merriett is not listed on the “schedule of covered autos you own” or anywhere else in the policy. The $1,000,000 liability coverage applies to covered autos as defined by “1.”  See exhibit 9-5, attached to R. 60. According to the policy’s “business auto coverage form,” the symbol “1” is defined as “any ‘auto,’ “ as opposed to the symbol “2” which includes only those autos owned by the policy holder. See exhibit 9-11, attached to R. 60. The term “auto” is defined in the policy as a land motor vehicle designed for travel on public roads. See exhibit 9-13, attached to R. 60. The “general conditions” section of the policy includes the following language:

a. For any covered “auto” you own, this Coverage Form provides primary insurance. For any covered “auto” you don’t own, the insurance provided by this Coverage Form is excess over any other collectible insurance….

…

d. When this Coverage Form and any other Coverage Form or policy covers on the same basis, either excess or primary, we will pay only our share. Our share is the proportion that the Limit of Insurance of our Coverage Form bears to the total of the limits of all the Coverage Forms and policies covering on the same basis.

Exhibits 9-12, 9-13, attached to R. 60.

B. Westfield Insurance Policy

Republic Diesel has insurance coverage through Westfield. The “  commercial auto coverage part” of the Westfield policy includes auto liability coverage up to $1,000,000 for covered autos. Exhibits 11-2, 11-3, attached to R. 60. The truck driven by Merriett is individually listed on Westfield’s “schedule of covered autos you own” as a 1995 International, serial number 1HTSDAANOSH249127. Exhibit 11-4, attached to R. 60. The total premium paid on the truck is listed as $1,586.00, including $1,368 for liability. The commercial auto coverage portion of the policy does not include language regarding “other insurance” coverage.

See section III.C for further discussion.

The Westfield policy additionally includes umbrella coverage up to $2,000,000. The “commercial umbrella coverage form” includes the following language regarding other insurance: “If other valid and collectible insurance is available to the insured for a loss also covered by this coverage, the insurance afforded by this coverage shall apply as excess of and not contribute with such other insurance.”Exhibit 11-21, attached to R. 60.

II. Standard of Review

Summary judgment is appropriate only when there are no genuine issues of material fact and the moving party is entitled to a judgment as a matter of law. Celotex Corp. v. Catrett, 477 U.S. 317 (1986). The moving party can satisfy its burden by demonstrating an absence of evidence to support the non-movant’s case. Id. at 324-25.To survive summary judgment, the non-movant must come forward with evidence on which a jury could reasonably find in its favor. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252 (1986). The non-movant must present more than a mere scintilla of evidence to defeat a motion for summary judgment. Street v. J.C. Bradford & Co., 886 F.2d 1472, 1479 (6th Cir.1989); Fed.R.Civ.P. 56(e). The court must view all of the evidence in the light most favorable to the party opposing summary judgment. See  Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986).“When reviewing cross-motions for summary judgment, the court must evaluate each motion on its own merits and view all facts and inferences in the light most favorable to the nonmoving party.”  Wiley v. United States, 20 F.3d 222, 224 (6th Cir.1994) (citing Taft Broadcasting Co. v. United States, 929 F.2d 240, 248 (6th Cir.1991)).

III. Legal Analysis

Zurich and Westfield each filed a motion for summary judgment requesting that the other insurance company be found to owe a duty to defend and indemnify any claim arising out of the accident at issue. Under Kentucky law, “[i]t is well established that ‘[w]hen the contest is between two insurers, the liability for a loss should be determined by the terms and provisions of the respective policies….’ State Farm Mutual Auto. Ins. Co. v. Register, 583 S.W.2d 705, 706 (Ky.Ct.App.1979). Furthermore, where the terms of an insurance policy are clear and unambiguous, the policy should be enforced as written. Masler v. State Farm Mutual Auto. Ins. Co ., 894 S.W.2d 633, 636 (Ky.1995).”  Chicago Ins. Co. v. Travelers Ins. Co., 967 S.W.2d 35, 37 (Ky.Ct.App.1997). Thus, the court will look to the insurance policies to determine whether either insurer has a duty to defend and indemnify in the underlying suit, whether the policies provide primary or excess coverage, and, finally, how the expenses and losses should be divided between the two insurers.

A. Duty to Defend and Indemnify

Under Kentucky law, liability coverage is not personal, but runs with the vehicle. Windham v. Cunningham, 902 S.W.2d 838, 841 (Ky.Ct.App.1995) (citing Butler v. Robinette, 614 S.W.2d 944, 947 (Ky.1981)).“An automobile insurance company has a general responsibility to provide coverage for people who may not be named insureds in the written policy, but fall under the coverage provided for in the policy.”  Mitchell v. Allstate Insurance Co., 244 S.W.3d 59, 61 (Ky.2008) (citing 46 C.J.S. Insurance  § 4045 (1993)).

The Westfield policy includes $1,000,000 in commercial auto liability coverage for covered autos. The truck at issue is specifically identified on the policy and Republic Diesel paid a specifically designated amount for liability on the truck. Additionally, the Westfield policy includes hired and non-owned coverage; thus, the policy covers the “non-owned” truck even though Republic Diesel does not hold paper title to the truck. Republic Diesel had an insurable interest in the truck because the shuttle truck was driven by Merriett on behalf of both Republic Industries and Republic Diesel. Patrick v. Ky. Farm Bureau Mut. Ins. Co., 413 S.W.2d 340, 343 (Ky.1967) (“Insurable interest is that interest in the subject matter insured by virtue of which the person insured will derive pecuniary benefit or advantage from its preservation, or will suffer pecuniary loss or damage from its destruction or injury by the happening of the event insured against.”). Liability coverage runs with the vehicle, and Westfield’s policy includes auto coverage on the truck driven by Merriett. Thus, Westfield has a duty to defend and indemnify in the underlying state court action.

Westfield admits that the truck driven by Merriett was insured at the time of the accident by both Zurich and Westfield. However, Westfield argues that although it provided Republic Diesel with insurance on the truck, the driver was not an employee or agent of Diesel and thus it is not vicariously liable for the driver’s actions. Republic Industries does not contest that Merriett was its employee and that he was acting within the scope of his employment when the accident occurred. Westfield argues that Republic Diesel’s lack of control over Merriett precludes any imputation of liability on Diesel for Merriett’s actions. However, Merriett was sued in the state-court action in his individual capacity in addition to the claims against his employer for vicarious liability. Republic Diesel knew that Merriett was driving the truck which it had insured through Westfield. Additionally, Republic Diesel reimbursed Republic Industries for a portion of the expenses of operation of the shuttle truck, including Merriett’s salary. See exhibit 7, attached to R. 60.

Zurich argues that Republic Industries did not own the truck involved in the accident, but that Republic Diesel was the owner. However, Republic Diesel was not an owner of the truck, despite its being listed on Westfield’s policy as an owned vehicle. Under Kentucky law, an owner is “a person who holds the legal title of a vehicle or a person who pursuant to a bona fide sale has received physical possession of the vehicle subject to any applicable security interest.”KRS § 186.010(7)(a). Physical possession of the vehicle is unclear from the deposition testimony and is disputed by the parties. However, Republic Diesel did not have title to the truck. Thus, Zurich’s policy also includes liability coverage for the truck because Republic Industries owned the truck and the policy provides coverage for owned autos.

B. Primary Versus Excess Coverage

Zurich argues that the Westfield policy is primary. As to whether the Westfield policy is primary or excess, the declarations page states “GARAGEKEEPERS-DIRECT PRIMARY ENDORSEMENT, $3,791,” and an amendment effective October 1, 2002, states on the endorsement that the direct coverage option is “primary insurance” by marking the appropriate box. Exhibits 11-4, 11-30, attached to R. 60. The issued endorsement is labeled “GARAGEKEEPERS COVERAGE” but states that the “endorsement modifies insurance provided under the … BUSINESS AUTO COVERAGE FORM.”Exhibit 11-29, attached to R. 60. Thus, the “primary” designation applies to the commercial auto coverage provided under Westfield’s policy.

Zurich’s policy states that “for any covered ‘auto’ you own, this Coverage form provides primary insurance.”Exhibit 9, attached to R. 62. Since Republic Industries held the paper title on the truck, it owned the truck.The truck was not specifically listed on Zurich’s policy, but Republic Industries owned the vehicle and employed the driver, and thus its coverage is primary.

Paper title was held by Republic Industries, the company insured by Zurich, at the time of the accident. However, Zurich argues that Republic Diesel intended to own the vehicle and thus included the vehicle on its insurance with Westfield and paid a premium on the truck. According to Zurich, the possession of the paper title is not determinative when resolving a dispute between insurance companies. Omni Insurance Company v. Kentucky Farm Bureau Mutual Insurance Company, 999 S.W.2d 724 (Ky.Ct.App.1999). In Omni, a father bought a car for his son and obtained insurance on the car. Upon receiving the title the father sent it to the son, who signed and mailed it. The son then purchased his own insurance on the car. The father took the title to the clerk’s office to transfer ownership, but that same morning, and before the transfer was effected, the son had an accident. In a dispute between the father’s and son’s insurance companies, the court found that even though the father still had paper title to the car at the time of the accident, the son’s insurance company had agreed to protect the son “against liability arising out of the use of the vehicle and charged him a premium for that protection.”Id. at 727.The court found that liability should be apportioned “between the two insurers according to their respective insuring contracts which contain ‘other insurance’ clauses.”Id. at 728.However, the intended owner of the vehicle was clear in Omni, and public policy concerns were met by the intended owner’s obtaining insurance on the vehicle prior to the completed transfer of title. Even though Republic Industries similarly held a paper title, it was clear in Omni that both parties intended for ownership to be transferred. In the present case it is not clear from deposition testimony or otherwise which company intended to own the truck.

The Zurich and Westfield policies thus both provide primary coverage on the truck driven by Merriett in the relevant accident. The Westfield policy additionally provides umbrella coverage of $2,000,000. The “schedule of underlying insurance” for the umbrella coverage lists the $1,000,000 auto liability policy by Westfield. Exhibit 11-12, attached to R. 60. Thus, the umbrella coverage acts as excess after the primary coverage is exhausted.

C. Division of Coverage Among Multiple Insurers

Zurich argues that if both auto policies are deemed primary, then the “other insurance” provision in the Zurich policy controls as to their respective obligations because Westfield does not have a comparable provision applicable to the commercial auto coverage.Zurich states that in such a situation it would pay only its fifty percent share up to two million dollars since both policies have one-million-dollar limits. “That sharing would not only apply to any indemnification required, up to a judgment for two million dollars, it would also apply to expenses incurred in the defense of the state action. Westfield’s obligations under its umbrella policy would come into play if a judgment is rendered in excess of $2,000,000.”R. 60, at 21.

Zurich argues that the Westfield policy does not include an “other insurance” provision applicable to the primary auto coverage. Zurich argues that the “other insurance” provision included in Westfield’s “commercial umbrella coverage form” applies only to the umbrella policy and not to the commercial auto coverage portion of the Westfield policy.

Westfield argues that if its policy is found to provide primary coverage, then any costs should be shared pro rata between Zurich and Westfield. Westfield states that the “other insurance” provisions contained in both policies  dictate such a division of responsibility if both insurers are found to have a duty to defend and indemnify. Westfield argues that if both insurance policies are applicable then the costs should be shared pro rata until the primary limits are met. This is the same division of liability as provided for in the “other insurance” provision of Zurich’s policy. Thus, the court will apply the “other insurance provision” from Zurich’s policy.

In its response to the plaintiff’s motion for partial summary judgment, Westfield quotes an “other insurance” provision and states that it attached the relevant portion of the policy as exhibit 1. See R. 63, at 3. However, the page from the policy that was attached as an exhibit does not include the language that was quoted in Westfields’s memorandum. Zurich attached the appropriate pages to its reply, but points out that the provision follows language limiting that clause to personal injury protection.”  See R. 66, exhibit 1. Whether Westfield’s policy includes such a provision does not alter the outcome.

“When this Coverage Form and any other Coverage Form or policy covers on the same basis, either excess or primary, we will pay only our share. Our share is the proportion that the Limit of Insurance of our Coverage Form bears to the total of the limits of all the Coverage Forms and policies covering on the same basis.”Exhibit 9-13, attached to R. 60.

IV. Conclusion

Zurich and Westfield both agreed to protect their insureds against liability arising out of the use of the vehicles covered by their respective policies. Each insurer has a duty to defend and indemnify in the underlying state court action that arose out of the motor vehicle accident on April 10, 2003. The auto liability coverage provided by both Zurich and Westfield is primary coverage, and each must pay its proportionate share up to the primary coverage limits, and then Westfield’s excess coverage will apply. Accordingly,

IT IS ORDERED that the plaintiff’s motion for partial summary judgment (R. 60) is GRANTED IN PART and DENIED IN PART.

IT IS FURTHER ORDERED that Westfield’s motion for summary judgment (R. 62) is GRANTED IN PART and DENIED IN PART.

IT IS FURTHER ORDERED that the parties are to share the costs of defending and indemnification in accordance with this opinion.

IT IS FURTHER ORDERED that the pretrial conference scheduled for January 16, 2009, and the jury trial scheduled for March 9, 2009, are CANCELLED.

IT IS FURTHER ORDERED that the parties shall file a status report regarding any remaining claims in this action no later than 15 days from the date of entry of this order.

United States District Court, M.D. Florida,

Tampa Division.

Johnny WORD, Dorinda Word, his wife, individually and as parents and natural guardians of minors K.W., A.W., and B.W., Plaintiffs,

v.

ILLINOIS UNION INSURANCE COMPANY, Defendant.

No. 8:07-cv-1513-T-33TGW.

Jan. 22, 2009.

ORDER

VIRGINIA M. HERNANDEZ COVINGTON, District Judge.

This matter comes before the Court pursuant to Plaintiffs’ motion for partial summary judgment (Doc. # 21), which was filed on June 25, 2008. On July 11, 2008, Defendant filed both its response in opposition to Plaintiffs’ motion for partial summary judgment (Doc. # 27) and its own motion for summary judgment. (Doc. # 28). Plaintiffs filed a response in opposition to Defendant’s motion for summary judgment on July 17, 2008. (Doc. # 38). On August 21, 2008, with leave of this Court, Defendant filed a reply to Plaintiffs’ response to Defendant’s motion for summary judgment. (Doc. # 43).

On December 31, 2008, this Court entered an order granting Plaintiffs’ unopposed motion to bifurcate trial and setting oral argument on the pending motions for summary judgment. (Doc.49, 51). Thereafter, on January 15, 2009, this Court held oral argument on the summary judgment motions. (Doc. # 54). For the reasons that follow, this Court grants Defendant’s motion for summary judgment (Doc. # 28) and denies Plaintiffs’ motion for summary judgment. (Doc. # 21).

I. Undisputed Facts

Plaintiffs, Johnny Word along with his wife and minor children, sue Defendant Illinois Union Insurance Company for insurance benefits under Illinois Union policy # XSAHO784123. Mr. Word was employed as a truck driver by CTL Distribution, Inc., a subsidiary of Comcar Industries, Inc. (Word Aff. Doc. # 22 at ¶ 1). The Word family resides in Florida, and Illinois Union is incorporated in Illinois. (Doc. # 1 at ¶ 7).

On August 21, 2004, while driving a truck owned by his employer, Mr. Word was involved in a motor vehicle accident. (Word Aff. Doc. # 22 at ¶ 1). The accident was caused by Alberio Mejia, an underinsured motorist. (Id.). Mr. Word was injured in the accident. (Id. at ¶ 3-5). Mr. Word asserts that he has incurred medical bills of approximately $175,000 and asserts that he sustained permanent, disabling injuries. (Id. at ¶ 4-5).

Mr. Mejia was insured for $100,000, and Mr. Mejia’s insurance company paid that amount to Mr. Word. (Doc. # 1 at ¶ 8; Zohar Aff. Doc. # 52 at ¶ 1). On December 29, 2004, the Words’ counsel sent correspondence to Crawford & Co. claims adjusters inquiring about underinsured motorist coverage under CTL and/or Comcar’s insurance policy. (Id. at ¶ 3). The Words’ counsel received no response from the claims adjusters, and therefore, the Words’ counsel began corresponding directly with ACE Group, the owner of Illinois Union Insurance Company.

A representative of ACE Group, Robert McCullogh, notified the Words’ counsel that “Johnny Word was covered for underinsured motorist coverage for this accident under the policy issued to Comcar Industries up to the sum of $2,000,000 (equal to the liability limit of the policy).”(Id. at ¶ 4). On September 14, 2005, Mr. McCullogh faxed to the Words’ counsel a copy of policy # XSAHO7841723 containing “Endorsement # 4 a Florida election of UM non-stacked coverage.”(Id. at ¶ 5).

However, on January 4, 2006, Thomas R. Lowe, risk manager for Comcar, authored a letter to the Words’ counsel indicating that Comcar rejected underinsured motorist coverage. (Id. at ¶ 6).

It cannot be disputed that the policy in question is policy # XSAHO7841723, with an effective date of November 1, 2003, through November 1, 2004. Comcar purchased the policy with the assistance of Keystone Risk Partners of Pennsylvania. (Hauner Dep. Doc. # 33 at 20:4-9). Keystone offered the policy to the predecessor insurer, American International Group (AIG) as well as to ACE Group (Burks Dep. Doc. # 30 at 45:12-15; Lewis Dep. Doc. # 31 at 24:17-20). Mr. Lowe chose ACE Group, and he executed a written rejection of underinsured motorist insurance coverage on October 23, 2003. (Lowe Dep. Doc. # 29 at 8:7-24). Mr. Lowe provided the rejection form to Keystone. However, Keystone did not deliver the rejection form to ACE Group until after Mr. Word’s accident.

The record contains deposition testimony from Mr. Lowe indicating that he signed a written underinsured motorist coverage rejection form two times prior to the accident: first on October 23, 2003, and then on August 12, 2004. (Lowe Dep. Doc. # 29 at 9:1-25; 82:6-25; 83:1-25). Plaintiffs do not dispute that Mr. Lowe signed the form on October 23, 2003; however, Plaintiffs do not agree that Mr. Lowe signed the rejection form on August 12, 2004.

The parties have filed various versions and excerpts of the policy in question. For instance, in support of their motion for summary judgment, Plaintiffs filed as exhibit six to their motion for summary judgment “Parts of Policy # XSA HO 7841723.”(Doc. # 21-5 at 2-48). However, in each and every version of the policy on file, the policy is titled “excess truckers liability policy” and on the declaration page of the policy, it states that the insurer will indemnify the insured for loss from bodily injury liability up to a sum certain over a “retained limit.” (Doc. # 21-5 at 1-48).

During her deposition, Robin Hauner, as the corporate representative of Illinois Union testified that the policy is an excess insurance policy because “it applies in excess of a self-insured retention.”(Hauner Dep. Doc. # 33 at 44:16-19). She further explained, “If the claim is covered, a payment has to be greater than three million for our policy to respond.”(Id. at 46:3-25).

Section II of the policy titled Liability Coverage states, “We will pay the insured for the ultimate net loss in excess of the retained limit … that the insured must legally pay as damages because of bodily injury … to which this policy applies caused by an accident and resulting from the ownership, maintenance or use of a covered auto.” (Doc. # 21-5 at 13).

After the accident, Mr. Word demanded that Illinois Union “tender and pay its full [policy] limit of $2,000,000 underinsured coverage” and Illinois Union refused. Thereafter, on August 8, 2007, the Words filed suit against Illinois Union in Circuit Court in and for Hillsborough County, Florida, seeking underinsured motorist insurance benefits for Mr. Word. (Doc. # 2).

Illinois Union filed their answer and affirmative defenses in state court on August 24, 2007, asserting twelve affirmative defenses. (Doc. # 3).

II. Summary Judgment Proceedings

Plaintiffs filed their motion for partial summary judgment (Doc. # 21) on June 25, 2008, and Defendant filed its motion for summary judgment (Doc. # 28) on July 11, 2008. These motions pertain to insurance coverage issues only, and do not discuss liability and damages. Illinois Union seeks a summary judgment finding that Mr. Word is not covered under the applicable policy and Mr. Word seeks a summary judgment finding that he is covered.

After due consideration, this Court grants Defendant’s motion for summary judgment and denies Plaintiffs’ motion for summary judgment because this Court finds that the policy in question was an excess policy, rather than a primary policy. In addition, this Court finds that Mr. Lowe’s rejection of underinsured motorist coverage was legally sufficient.

A. Legal Standard

Summary judgment is appropriate “if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.”Fed.R.Civ.P. 56(c). A factual dispute alone is not enough to defeat a properly pled motion for summary judgment; only the existence of a genuine issue of material fact will preclude a grant of summary judgment. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).

An issue is genuine if the evidence is such that a reasonable jury could return a verdict for the nonmoving party. Mize v. Jefferson City Bd. of Educ., 93 F.3d 739, 742 (11th Cir.1996) (citing Hairston v. Gainesville Sun Publ’g Co., 9 F.3d 913, 918 (11th Cir.1993)). A fact is material if it may affect the outcome of the suit under the governing law. Allen v. Tyson Foods, Inc., 121 F.3d 642, 646 (11th Cir.1997). The moving party bears the initial burden of showing the court, by reference to materials on file, that there are no genuine issues of material fact that should be decided at trial. Hickson Corp. v. N. Crossarm Co., Inc. ., 357 F.3d 1256, 1260 (11th Cir.2004) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986)).“When a moving party has discharged its burden, the non-moving party must then ‘go beyond the pleadings,’ and by its own affidavits, or by ‘depositions, answers to interrogatories, and admissions on file,’ designate specific facts showing that there is a genuine issue for trial.”  Jeffery v. Sarasota White Sox, Inc., 64 F.3d 590, 593-94 (11th Cir.1995) (citing Celotex, 477 U.S. at 324).

If there is a conflict between the parties’ allegations or evidence, the non-moving party’s evidence is presumed to be true and all reasonable inferences must be drawn in the non-moving party’s favor. Shotz v. City of Plantation, Fla., 344 F.3d 1161, 1164 (11th Cir.2003). If a reasonable fact finder evaluating the evidence could draw more than one inference from the facts, and if that inference introduces a genuine issue of material fact, the court should not grant summary judgment. Samples ex rel. Samples v. City of Atlanta, 846 F.2d 1328, 1330 (11th Cir.1988) (citing Augusta Iron & Steel Works, Inc. v. Employers Ins. of Wausau, 835 F.2d 855, 856 (11th Cir.1988)). However, if non-movant’s response consists of nothing “more than a repetition of his conclusional allegations,” summary judgment is not only proper, but required. Morris v. Ross, 663 F.2d 1032, 1034 (11th Cir.1981), cert. denied, 456 U.S. 1010, 102 S.Ct. 2303, 73 L.Ed.2d 1306 (1982).

B. Florida Insurance Law

In this diversity case, the Court applies the substantive law of the forum state unless federal constitutional or statutory law compels a contrary result. Tech.  Coating Apps., Inc. v. United States Fid. & Guar. Co., 157 F.3d 843, 844 (11th Cir.1998). Furthermore, this Court must apply Florida law in the same manner that the Florida Supreme Court would apply it. Brown v. Nicholas, 8 F.3d 770, 773 (11th Cir.1993).

In the present case, both parties agree that Florida insurance law governs the issues before the Court. Under Florida law, the interpretation of an insurance contract is a matter of law to be decided by the court. Gas Kwick, Inc. v. United Pac. Inc. Co., 58 F.3d 1536, 1539 (11th Cir.1995). Courts must construe an insurance contract in its entirety, striving to give every provision meaning and effect. Id. (citing Dahl-Eimers v. Mut. of Omaha Life Ins. Co., 986 F.2d 1379, 1382 (11th Cir.1993)).

1. Florida’s UIM Statute

The resolution of this case requires a detailed discussion of Florida Statute Section 627.727, titled “motor vehicle insurance; uninsured and underinsured vehicle coverage; insolvent insurer protection” (hereafter, the “UIM Statute” or “UM Statute”). Subsection one of the UIM Statute states in pertinent part that UIM insurance may be rejected:

No motor vehicle liability insurance policy which provides bodily injury liability coverage shall be delivered or issued for delivery in this state with respect to any specifically insured or identified motor vehicle registered or principally garaged in this state unless uninsured motor vehicle coverage is provided therein or supplemental thereto for the protection of persons insured thereunder who are legally entitled to recover damages from owners or operators of uninsured motor vehicles because of bodily injury, sickness, or disease, including death, resulting therefrom. However, the coverage required under this section is not applicable when, or to the extent that, an insured named in the policy makes a written rejection of the coverage on behalf of all insureds under the policy.

Fla. Stat. § 627.727(1).

Subsection two of Florida Statute Section 627.727 explains:

The limits set forth in this subsection, and the provisions of subsection (1) which require uninsured motorist coverage to be provided in every motor vehicle policy delivered or issued for delivery in this state, do not apply to any policy which does not provide primary liability insurance that includes coverage for liabilities arising from the maintenance, operation, or use of a specifically insured motor vehicle.

Fla. Stat. § 627.727(2).

Thus, in Florida, UIM coverage in an amount equal to the bodily injury policy limit is automatically included in primary insurance policies by operation of law unless such coverage is specifically rejected by the insured.

2. Florida’s Public Policy

The aforementioned statute has been interpreted and discussed by the Florida Supreme Court as follows:

UM coverage … is intended to protect persons who are injured as a result of negligence by uninsured motorists…. [U]nderinsured motorist coverage is statutorily intended to provide the reciprocal or mutual equivalent of automobile liability coverage prescribed by the Financial Responsibility Law…. The Legislature wisely enacted a scheme whereby a motorist may obtain a limited form of insurance coverage for the uninsured motorist, by requiring that every insurer doing business in this state offer and make available to its automobile liability policyholders UM coverage in an amount equal to the policyholder’s automobile liability insurance. The policyholder pays an additional premium for such coverage. More recently, this Court again emphasized that the reason insurers are statutorily required to offer UM coverage to the insured is to protect individuals who are injured or damaged by other motorists who in turn are not insured and cannot make whole the injured party. The statute is designed for the protection of injured persons, not for the benefit of insurance companies or motorists who cause damage to others.

Flores v. Allstate Ins. Co., 819 So.2d 740, 745 (Fla.2002) (citations omitted) (quotations omitted).

Furthermore, the Florida Supreme Court explained in Salas v. Liberty Mutual Fire Insurance Co., 272 So.2d 1 (Fla.1972):

[T]he intention of the Legislature, as mirrored by the decisions of this Court, is plain[:] to provide for the broad protection of the citizens of this State against uninsured motorists. As a creature of statute rather than a matter for contemplation of the parties in creating insurance policies, the uninsured motorist protection is not susceptible to the attempts of the insurer to limit or negate that protection.

Id. at 5. In addition, the Florida Supreme Court has warned that “[b]ecause the uninsured motorist statute was enacted to provide relief to innocent persons who are injured through the negligence of an uninsured motorist; it is not to be whittled away by exclusions and exceptions.”  Young v. Progressive S.E. Ins. Co., 753 So.2d 80, 83 (Fla.2000).

In this case, the insurance company seeks to avoid paying benefits, therefore, this Court must “carefully scrutinize” Illinois Union’s position and determine whether denial of coverage “would be contrary to the purpose of the uninusred motorist statute .”  Flores, 819 So.2d at 745.

III. Analysis

A. Excess Policy

Defendants assert that the policy is an excess policy, rather than a primary policy, and therefore, Florida’s UIM Statute does not apply. Plaintiffs, on the other hand, argue that self-insurance is not primary insurance, and therefore, Defendant’s policy (although labeled excess) is a primary policy because it is the first layer of actual insurance. In support of their arguments, Plaintiffs rely upon S.E.  Title Insurance Co. v. Collins, 226 So.2d 247 (Fla. 4th DCA 1969); Government Employees Ins. Co. v. Wilder, 546 So.2d 12 (Fla. 3rd DCA 1989); and Royal Surplus Lines v. Coachmen Indus. Inc., Case No. 3:01-cv-301-J-HTS, 2002 U.S. Dist. LEXIS 27892 (M.D.Fla. Sept. 17, 2002).

While the cases cited by Plaintiffs do discuss self-retained limits of an insured, these cases do not support the conversion of Defendant’s patently excess policy into a primary policy for the purposes of compliance with Florida’s UIM Statute. In the Collins case, the court rejected the argument that an employer’s certificate of financial responsibility constituted insurance, and the court defined insurance as “a contract, whereby, for an adequate consideration, one party undertakes to indemnify another against loss arising from certain specified contingencies or perils. Fundamentally and shortly, it is contractual security against possible, anticipated loss. Risk is essential, and equally so, a shifting of its incidence from one to another.”Id. at 248 (citations omitted). However, unlike the specific policy in the present case, the policy in question in the Collins case simply stated that the policy “shall be excess insurance over any other valid and collectible insurance.”Id.

Likewise, in Wilder, the court remarked:

As an individual self-insurer is not, for most purposes, an “insurer” under the Florida Insurance Code, see § 624.03, Fla. Stat. (1987), and as Allstate Insurance Co. v. Fowler, 480 So.2d 1287 (Fla.1985), dealt with the setting of priorities among insurance policies, we do not believe that the Fowler decision can reasonably be interpreted as holding that a self-insurer is to be treated as if he were an insurer for purposes of the Fowler rule.

Id. at 13.The Wilder case was not decided under facts similar to this case, and the Wilder court did not mention underinsured motorist coverage. Likewise, the Royal Surplus case, which states, “The weight of authority establishes that a retained limit does not generally convert an insured into a primary insurer” is factually distinguishable from the present case. The dispute in Royal Surplus concerned a primary insurer’s claim that the insured improperly concealed claim information from the insurer, resulting in the payment of additional funds under the policy.

Defendant correctly harmonizes Plaintiffs’ cases as follows: (1) while self-insurance is not primary insurance, it does assume responsibility for the primary layer of exposure; and (2) a policy which sits above the primary layer of exposure is properly characterized as an ‘excess policy.’ (Doc. # 28 at 10).See  Royal Surplus Lines Ins. Co. v. Delta Health Group, Inc., Case No. 3:03-cv-419-RS, 2006 WL 167565 at(N.D.Fla. Jan.23, 2006), aff’d, 243 F. App’x 551 (11th Cir.2007) (for purposes of triggering an umbrella policy, an SIR was, in essence, another layer that required exhaustion prior to triggering the umbrella policy: “It is of no consequence that the SIR is not provided by an insurance company, per se.”)

Under the facts of the present case, this Court is not willing to convert the policy into something that it was not intended to be by the contracting parties. This Court finds in favor of Illinois Union and grants its motion for summary judgment. The policy in question was titled as an excess policy, and in addition to its “label,” it operates as an excess insurance policy. The policy was not triggered unless or until the exhaustion of Comcar’s three million dollar self-retained limit.

B. UIM Rejection

Even if the policy could be construed as a “primary” policy, Mr. Lowe executed a valid rejection of UIM coverage and delivered it to Comcar’s insurance broker, Keystone, prior to the accident. Mr. Lowe’s October 23, 2003, rejection of UIM coverage was valid under Florida law, and serves as an independent ground for granting Defendant’s motion for summary judgment.

This Court is aware of Florida’s strong public policy favoring UIM coverage, as set forth in Flores v. Allstate Ins. Co., 819 So.2d 740 (Fla.2002), and similar opinions. However, this Court cannot and will not ignore the statutory provision allowing rejection of UM coverage.

Unlike Flores, where the insurer sought to deny coverage based upon the insured’s fraud, the insurer in this case seeks to deny coverage because the insured, Comcar, executed a rejection of UIM coverage prior to the automobile accident. Regardless of Florida’s “public policy” in favor of coverage, the fact of the matter is that Florida’s statutory scheme specifically allows “rejection” of UIM coverage.

Defendant frames the issue as follows: “whether a rejection made by the insured, forwarded to the broker, but not received by the insurer until after the loss-satisfies the requirements of § 627.727.”(Doc. # 28 at 4).

This Court determines that Mr. Lowe’s rejection was adequate under Florida law. Mr. Lowe’s first UIM rejection form, dated October 23, 2003, is dispositive and self-proving. It was executed prior to the accident in question. It is not contested that Mr. Lowe also signed additional UIM rejection forms after the accident in question. However, these forms are not operative. Had Mr. Lowe attempted to “retroactively” reject UIM coverage for the first time at a time after the accident, as in Manchester Insurance and Indemnity Co. v. Jones, 317 So.2d 786 (Fla. 3rd DCA 1975), the outcome of this case would be very different.However, the record is clear and it cannot be reasonably disputed that Mr. Lowe made his first rejection of UIM coverage before the accident.

In Jones, the court ruled that a rejection form signed after an accident was not effective on the date of the accident. The court determined, “The applicable statute, § 627.727, specifically provides that an insured is covered with uninsured motorist protection unless such protection has been rejected … In view of the fact that the rejection of uninsured motorist coverage was signed after the accident, it cannot be said that such rejection was effective at the time that Jones paid the deposit on the insurance policy or at the time of the accident.”Id. at 787.

The Words contend that “the private intentions of Thomas Lowe are meaningless” and that, should this Court rule in Illinois Union’s favor “the fate of the innocent motorist [will] rest in the mental confines of a corporate risk manager who has not done what the law requires in depriving his employees of important insurance coverage.”(Doc. # 38 at 4-5).

This Court agrees that Mr. Lowe’s “intent” is not dispositive in this case, but his action of making a rejection of UIM coverage prior to the accident is dispositive. This Court follows the Florida Supreme Court’s analysis in Travelers Insurance Co. v. Quirk, 583 So.2d 1026 (Fla.1991). In Travelers, as in the present case, an employee was injured while riding in a vehicle owned by his employer. Id. at 1027.The employee sued his employer’s primary insurance company and the insurance company that issued an umbrella policy to his employer. Id. Neither policy provided UIM coverage. Id. at 1028.In addition, the employee sued the insurance agency that obtained the two insurance policies for the employer. Id. The employee argued that the insurance agency failed to obtain a “knowing, written rejection of UM coverage” from the employer in accordance with Florida Statute Section 627.727. Id. It was undisputed that the employer never executed a written UIM rejection. Instead, the insurance agency rejected UIM coverage on behalf of the employer.

On those undisputed facts, the trial court entered summary judgment in favor of the two insurance companies and in favor of the insurance agency.Id. at 1028.However, the Second District Court of Appeal reversed as to the primary insurer and the insurance agency and affirmed as to the insurance company that issued the umbrella policy. Id.

On appeal, the Florida Supreme Court adopted the Second District Court of Appeal’s reasoning that “the legislature is attempting to avoid litigation over a ‘knowing’ rejection by placing far greater emphasis and importance upon the written rejection as a self-proving document.”Id. at 1028.What invalidated the UIM rejection in Travelers was that it was executed by an agent of the insurance agency, rather than an agent of the insured. Id. at 1029.Evaluating Florida Statute Section 627.727, the court explained, “For purposes of rejecting UM coverage, as a matter of law, an independent agent is the insurance company’s agent, and not the insured’s broker, when the relevant insurance company is one of the agent’s licenced companies.”Id. at 1029.

Plaintiffs contend that in addition to executing the rejection form, Comcar was also required to deliver the form to the insurance company. In support of their position, Plaintiffs cite that portion of the Travelers case which cites the Second District Court of Appeal and states, “If the underwriting filing contains a signed rejection, a policy can be issued without UM. If the insured fails to sign and submit a rejection form, the carrier can simply refuse to issue a policy without UM.”Id. at 1028 (emphasis added). Plaintiffs also rely upon Giddes v. Glens Fall Insurance Co., Case No. 2:02-cv-282-FTM-29DNF, 2003 U.S. Dist. LEXIS 25112 (M.D.Fla. May 22, 2003), for the proposition that, “[W]hen an auto insurance policy is initially issued, the insurer must obtain a signed UM selection form on which the insured may reject UM benefits altogether, elect UM benefits in an amount less than the bodily injury liability limits, and elect either stacked or nonstacked UM coverage.”Id. at *10-11 (emphasis added).

This Court recognizes that Florida courts have commented that an insurance company must “obtain” the form and that the insured must “submit” the form to the insurance company. See Travelers, 583 So.2d at 1028;Giddes, 2003 U.S. Dist. LEXIS 25112 at *10-11. However, after reading these cases carefully, this Court determines that these statements were made in an effort to explain the nature of Florida’s UM Statute, and such statements do not expand the requirements of the statute by their dicta.

Indeed, neither the Travelers case nor the Giddes case involved the circumstances presented here, where the insured made a UIM coverage rejection, but failed to transmit the same to the insurance company. Further, Comcar was fully aware of its options and, through its own agent, executed the UIM rejection form in an effort to effectuate its choice from among its options under Florida law.

In the present case, Comcar’s agent, specifically, its risk manager, Mr. Lowe executed the rejection and sent the rejection to Comcar’s broker. This transaction, which occurred prior to the accident in question, validly rejected UIM coverage for Comcar. Unfortunately, the broker did not provide the rejection form to the insurer. This break in communication resulted in Mr. Word initially receiving correspondence incorrectly conveying that he was covered. However, the fact remains that Mr. Lowe rejected UM coverage, and Florida’s UM Statute requires no more.

This Court has applied the relevant Florida Statute and has not added additional requirements into the text of the Statute. This Court will leave the task of amending the Statute, if necessary, for the appropriate governmental body: the Florida Legislature.

Accordingly, it is now

ORDERED, ADJUDGED, and DECREED:

(1) Plaintiffs’ motion for partial summary judgment (Doc. # 21) is DENIED.

(2) Defendant’s motion for summary judgment (Doc. # 28) is GRANTED.

(3) The Clerk is directed to enter judgment in favor of Defendant Illinois Union Insurance Company and to close this case.

DONE and ORDERED.