The question whether automobile liability insurance policies are subject to stacking in Missouri has been a hot-button issue for the insurance industry in recent years. The Plaintiffs' Bar has advocated, with some success before the Missouri Supreme Court and the Missouri Court of Appeals, the stacking of liability policies based on the public policy underlying Missouri's Motor Vehicle Financial Responsibility Law.
In Dutton v. American Family Mut. Ins. Co., No. SC94075 (Mo. banc Feb. 3, 2015), a case in which we supported the insurance industry's position by filing an amicus curiae brief, the Missouri Supreme Court addressed the question head on and, in a six-one decision, ruled for the insurance industry on the stacking question.
The Missouri Supreme Court in Dutton addressed the question whether two separate automobile liability policies covering different cars owned by the same insured were required to respond to an automobile accident when only one of the vehicles was involved in the accident. The claimant argued that the policy on the uninvolved car was required to provide the insured with the minimum $25,000 in liability coverage required by the Financial Responsibility Law, even though the accident vehicle was not a listed vehicle on the policy and the policy excluded coverage for vehicles owned by the insured, but not insured by the policy.
The Missouri Supreme Court ruled for the insurer. The Court held the Financial Responsibility Law only required coverage under the policy insuring the car involved in the accident. The Supreme Court's decision emphasized the distinction between owner's policies and operator's policies under the Financial Responsibility Law. Thus, when an insured has two owner's policies, only the policy affording coverage for the vehicle involved in the accident is required to respond to the loss. The Court explained that the Financial Responsibility Law only requires coverage under an owner's policy for those vehicles specifically designated as insured vehicles under the policy as well as other vehicles used by the insured, but which are not owned by the insured.
The Supreme Court's decision in Dutton also corrects an anomaly under recent Missouri insurance law - one that permitted the stacking of automobile liability policies in the multiple policy context but not in cases in which a single liability policy covered multiple vehicles. Thus, the decision should have a salutary effect on Missouri insurance law by limiting the risks faced by automobile insurers issuing multiple automobile liability policies to their insureds.