Court enforces shorter statute of limitations contained in insurance company's Uninsured Motorist Coverage
Ira Mopkins sued her own insurer, National Indemnity Company, after it refused to honor its obligations under the Uninsured Motorist Coverage she bought with her auto no fault policy. The insurer claimed that she should have brought suit earlier, even though she had sued within the State of Michigan's contract statute of limitations. Her attorneys argued that the company should not be able to enforce a shorter statute of limiations and that, in any event, it should be "estopped" from enforcing the shorter limit in her case because the company never responded to their letter requesting a copy of the subject policy. The trial judge rejected Mopkins' attorneys' arguments and ruled that the company could deny her claim based on its own shorter statute of limitations in the policy.
On appeal, the lower court's decision was upheld. The appellate judges noted that an insurer can enforce any contract provision it wishes, even if the contract provision is inconsistent with state law, so long as it does not violate a "mandatory" insurance provision. Since the state does not require or "mandate" uninsured or underinsured motorist coverage, the insurer can enforce any arbitrary rule it inserts into the UM/UIM policy language. Insurers have used this "Engler Majority" rule of interpretation to re-write numerous insurance provisions that were formerly interpreted on a "reasonable expectation of the insured" basis.The appellate panel also ruled that failing to provide Mopkins' attorneys with a copy of the policy language on request did not affect the enforcement of the policy language. It held that the insurer owed no "duty" to respond to the request and that the attorneys could not reasonably assume anything about the content of the policy that the insurer failed to produce. The Court did allow that if Mopkins or her attorneys had asked the insurer the right questions in their request, they might have created a duty to respond.