In Tucker v. Government Employees Insurance Company, No. 14-1192 (10th Cir. 2017), the United States Court of Appeals for the Tenth Circuit untangled this disagreement.
David Tucker (“Tucker”) sued the Government Employees Insurance Company, d/b/a GEICO Indemnity Company (“GEICO”) for breach of contract and related claims after GEICO denied Tucker’s claim for underinsured motorist (“UIM”) benefits. In 2004, Bernadette Marquez (“Marquez”) bought an automobile insurance policy from GEICO that listed both Marquez and Tucker as named insureds. At the time, Tucker and Marquez had lived together for over 20 years but weren’t married. Marquez obtained and managed the couple’s policy. The original policy provided UIM coverage. But in 2005 and 2009, Marquez completed option forms on which she declined UIM coverage.
In 2011, Tucker was in an accident with an underinsured driver. Tucker filed a claim for UIM benefits. GEICO denied the claim, saying Marquez rejected UIM coverage on Tucker’s behalf. Tucker sued GEICO, alleging that its failure to pay his UIM claim constituted breach of contract, outrageous conduct, bad faith, and deceptive practices.
GEICO asserted that Marquez, as Tucker’s agent acting with either actual or apparent authority, effectively rejected UIM coverage on Tucker’s behalf. And the district court agreed and granted GEICO’s summary judgment motion, denied Tucker’s cross-motion, and dismissed the case. Tucker appeals.
Colorado law permits one named insured to waive UIM coverage for another named insured on the same policy by exercising apparent authority, express actual authority, or implied actual authority. And here, the district court granted summary judgment for GEICO based on the court’s conclusions that a named insured can reject UIM coverage for another named insured by exercising actual or apparent authority and Marquez exercised apparent authority when she rejected UIM coverage on Tucker’s behalf. Therefore, the Court of Appeals affirmed the lower court’s ruling.
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