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T. Thomas Metier
T. Thomas Metier
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How Long Do You Have to File a Colorado Underinsured Motorist Claim?

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The statute of limitations for filing an underinsured motorist claim in Colorado became the subject of an appellate court case in Stoesz v. State Farm, No. 14CA0956, Court of Appeals of Colorado, Division IV (June 18, 2015).

Section 13-80-107.5(1)(b) provides a three-year statute of limitations to file an underinsured motorist claim. However, if an action is commenced against the underinsured motorist or if a payment is made for the underlying bodily injury claim within three years, then the underinsured claim can be filed up to two years after the insured received the payment (emphasis added).

The statute offers these extra two years so that people have time to file the underinsured motorist claim once they become aware of the uncompensated loss—which may only become apparent after the underlying bodily injury claim is finalized.

So what was the issue in this case? The Court of Appeals had to determine the meaning of “payment” in the statute. Plaintiff Stoesz had settled her underlying claim with the underinsured motorist’s liability carrier, Progressive, prior to the three-year statute of limitations. However, her insurance carrier, State Farm, did not approve the settlement until after the three years were up. Progressive only cut the check to Stoesz after the three years had run, as well.

Stoesz then sought to file an underinsured claim against State Farm, alleging that the settlement agreement itself constituted a “payment” that would extend the deadline by two years.

The trial court entered Summary Judgment for State Farm, reasoning that a settlement agreement was not a “payment” as required by the statute.

The Court of Appeals confirmed. Although “payment” was not defined in the statute, the ordinary meaning and dictionary definitions of payment focused on the delivery of money to the person owed. In this case, the payment clearly took place after the three-year deadline.

(Stoesz also argued that Progressive agreed to toll the statute in the settlement, but State Farm claimed that such agreement did not affect its rights. The court agreed with State Farm.)

So does this case seem like Stoesz was treated unfairly? After all, Progressive agreed to the settlement amount before the three years was up, but State Farm only approved the settlement after three years. However, plaintiffs take note: In a situation where time is running out, Stoesz could have simply filed a complaint against the motorist to preserve her underinsured claim against State Farm for another two years. When the deadline was approaching and she had not yet received the payment, she should have filed suit. The Court of Appeals noted that filing the complaint would not have even required service of process to receive the two-year extension.

The Metier Law Firm is committed to assisting people with personal injury claims throughout Colorado, Wyoming and Nebraska, and we frequently serve as co-counsel to law firms nationwide.