Arizona Court of Appeals Division Two holds insurer may exclude underinsured motorist coverage when insured is driving large commercial truck.

In 2011, Frank Gambrell was driving a semi-tractor, transporting milk for his employer, when another driver crashed into the tractor and seriously injured Frank.  He received uninsured motorist coverage (“UIM”) from his employer’s policy.  Relying on the generally accepted principle that personal liability policies are generally portable, Frank then sought additional UIM coverage from his personal automobile liability insurance policy provided by IDS.  IDS denied coverage under a policy exclusion for commercial vehicles.  The Gambrells sued for breach of contract and bad faith, and IDS prevailed on a motion for summary judgment.

On appeal, the Court of Appeals affirmed.  It held that the Uninsured Motorist Act generally requires insurers to make UIM coverage available in an amount not less than the injury limits of a motor vehicle liability policy.  The appellate court held, however, that the Act does not require insurers to provide UIM coverage to commercial vehicle operators.  Rather, Section 20-259.01(C) of the Act gives insurers the discretion whether to provide such coverage.  Because IDS’ policy excluded UIM coverage for commercial vehicle operations, the court upheld the trial court’s decision granting summary judgment against the Gambrells’ claims. 

Judge Miller authored the opinion, and Judges Eckerstrom and Espinosa concurred.