Employee Using Vechicle Pursuant to Terms of Employer’s Insurance Policy is Insured for Liability and UIM Coverages
In Kim v. State Farm Mut. Auto. Ins. Co., Donald Young (“Young”) was traveling eastbound on Route 116 in the early morning. As he drove, he noticed a yellow light on a vehicle approximately one-half mile away. As he approached the vehicle, he moved into the westbound lane. As he passed the van, he hit something. Young went back to see what he hit, and he saw David Kim (“Kim”). Kim was an employee for Terra Engineering Ltd. (“Terra”) who installed traffic counting devices. The executive vice president of Terra testified that every employee must wear a reflective vest and a light on his head and turn on the oscillating yellow light on top of the van. Kim was wearing a reflective vest and a light on his head at the time he was struck. However, Young stated that prior to impact he did not see anything on the road.
At the time of the accident, Terra had an automobile policy issued by State Farm. The policy paid for liability up to $1 million per person and $1 million per occurrence and also provided UIM coverage limits of $1 million and UM coverage up to $1 million. For general liability, the policy defined an insured as “any person while using your car…if its use is within the scope of your consent.” Under its UIM coverage however, State Farm defined an insured with respect to bodily injury as “any person while occupying a vehicle covered under the liability coverage.” After obtaining proceeds from Young’s liability policy, Kim’s estate sought UIM coverage under State Farm’s policy issued to Terra. State Farm denied coverage, and Kim’s estate filed a complaint for declaratory judgment.
The court reviewed whether Kim qualified for UIM coverage under State Farm’s policy.
State Farm argues in its brief that in order for plaintiff to recover, Kim must qualify as an insured under its policy’s liability provisions.
Under Illinois law, all motor vehicles operated or registered in Illinois must have coverage under a liability insurance policy. The policy must also meet specific coverage requirements, including coverage for not only the insured, but also “any other person using or responsible for the use” of the vehicle with permission of the insured. 625 ILCS 5/7-317(b)(2) (West 2006). Illinois courts have found that their terms “to use” could mean the employment of an automobile “for the purpose of the user.” Therefore, the term “to use” is broader than the term “operation.” The court found that by using the Terra vehicle’s oscillating yellow light as a warning to other drivers while he worked, Kim was using the vehicle pursuant to the terms of State Farm’s policy and therefore is an insured for liability and UIM purposes.
Kim v. State Farm Mut. Auto. Ins. Co., 2014 IL App (1st) 131235.
