A Missouri spouse can recover loss-of-consortium damages independently of her husband’s underinsured-motorist benefits, the 8th U.S. Circuit Court of Appeals ruled, reversing a lower court decision that had limited recovery to a single per-person policy cap.
The appellate panel found that an auto insurance policy issued by Auto-Owners Mutual Insurance Company was poorly drafted, creating ambiguity around who qualifies as an insured for purposes of underinsured-motorist coverage.
Under Missouri law, such ambiguity must be construed against the insurer.
The dispute arose after Beverly Granger filed a UIM claim for loss-of-consortium damages following severe injuries suffered by her husband, Randy Granger, in a car accident.
The at-fault driver’s insurer paid its $25,000 policy limit. The Grangers’ Auto-Owners policy set UIM limits of $250,000 per person and $500,000 per occurrence.
Auto-Owners paid Randy the $250,000 per-person limit, then denied Beverly’s claim, arguing the policy allowed only one recovery because her loss-of-consortium damages derived entirely from her husband’s bodily injuries.
The insurer sought declaratory relief in district court, which agreed and held that Beverly’s claim could not exceed the per-person cap already paid.
On appeal, the Eighth Circuit took a narrower view of the policy language. The panel concluded the policy supported more than one reasonable interpretation, which triggered Missouri’s rule requiring courts to adopt the construction favoring coverage.
At issue was the policy’s scope-of-coverage provision and its repeated use of the word you. One reading, adopted by the district court, limited benefits to a person who personally sustained bodily injury, which excluded Beverly.
Another reading, grounded in Missouri law and the policy’s definitions, treated Beverly as a separate insured entitled to damages for her own legally recognized injury.
Missouri law treats loss of consortium as a claim belonging to the uninjured spouse, not merely an extension of the injured party’s damages. The appeals court said an insurance policy must reflect that principle unless it clearly states otherwise.
The panel acknowledged a potential conflict arising from the policy’s use of you to describe a single insured.
Even so, the court said the policy definition of you includes both the named insured and a spouse residing in the same household, and the conjunction and could reasonably be read to allow each spouse to qualify independently.
Under that interpretation, Randy’s bodily injury satisfies the condition triggering coverage, while Beverly’s loss-of-consortium damages attach as a separate claim subject to her own $250,000 per-person limit.
The court concluded the Auto-Owners policy left too much uncertainty over what was covered and for whom. Because Missouri law resolves unclear policy language against the insurer, the panel held Beverly is entitled to pursue her loss-of-consortium claim under the UIM coverage, separate from the amount paid to her husband.
