Commercial Auto Policies: No Mandatory UIM Offer for Non-Owned Vehicles Under WV Code § 33-6-31

Introduction

In Erie Insurance Property & Casualty Co. v. Cooper, 2025 WL ___ (W. Va. Apr. 29, 2025), the Supreme Court of Appeals of West Virginia answered a certified question from the U.S. Fourth Circuit. The issue was whether West Virginia’s uninsured/underinsured motorist (UIM) statute, W. Va. Code § 33-6-31, obligates an insurer issuing a commercial automobile liability policy that covers both owned and a class of non-owned vehicles to offer UIM coverage on the non-owned vehicles. The Court held that the statute does not require such an offer.

Parties: Erie Insurance Property & Casualty Company (Petitioner), Pison Management, LLC (named insured under the policy), and James Skyler Cooper (Respondent).

Key Issue: Must an insurer offer UIM coverage on a class of non-owned vehicles when it issues a commercial auto liability policy covering both owned vehicles and that class of non-owned vehicles?

Summary of the Judgment

The Fourth Circuit certified the question because there was no controlling West Virginia precedent. This Court applied a de novo standard and reviewed the statutory text of § 33-6-31(a) (liability), (b) (offer of UIM), and (c) (definition of “insured”). It concluded:

“The motor vehicle to which the policy applies” in the UIM definition refers to the named insured’s owned vehicles listed on the policy.
The statute’s language requiring UIM offers “to the insured” does not extend to non-owned vehicles that the named insured neither owns nor controls.
Permissive use language (“with the consent, expressed or implied, of the named insured”) is tied to vehicles over which the named insured has the authority to consent.

Thus, Erie was not required to offer UIM coverage for the class of non-owned vehicles associated with Pison’s commercial policy. The certified question was answered “No,” and the case was remanded to the Fourth Circuit.

Analysis

Precedents Cited

Light v. Allstate Ins. Co., 203 W. Va. 27, 506 S.E.2d 64 (1998) – De novo review applies to certified questions.
Alexander v. State Automobile Mut. Ins. Co., 187 W. Va. 72, 415 S.E.2d 618 (1992) – UIM coverage “contemplates recovery, up to coverage limits, from one's own insurer, of full compensation for damages not compensated by a negligent tortfeasor.”
Taylor v. Nationwide Mut. Ins. Co., 214 W. Va. 324, 589 S.E.2d 55 (2003) – Primary object of statutory construction is to give effect to legislative intent.
Stone v. Liberty Mut. Ins. Co., 478 S.E.2d 883 (Va. 1996) – Interpreting a materially identical certified question under Virginia law, the court held UIM coverage need not be offered for non-owned vehicles, focusing on “the motor vehicle to which the policy applies” and permissive‐use consent.
State Automobile Mutual Ins. Co. v. Youler, 183 W. Va. 556, 396 S.E.2d 737 (1990) – UIM coverage must fully compensate the insured up to policy limits.

Legal Reasoning

1. Statutory Text. Section 33-6-31(b) requires that every liability policy “provide an option to the insured … to pay the insured all sums which he or she is legally entitled to recover … from the owner or operator of an uninsured or underinsured motor vehicle up to an amount not less than limits of liability insurance purchased by the insured.” Section 33-6-31(c) defines “insured” in two classes:

Class I: Named insured, spouse, resident relatives—coverage portable anywhere.
Class II: Anyone using “the motor vehicle to which the policy applies,” with the consent of the named insured.

2. Owned vs. Non-Owned. The term “the motor vehicle to which the policy applies” is singular and refers to specific vehicles listed on the declarations page. Non-owned vehicles are covered only for liability under an omnibus clause, but they are not “the motor vehicle” for UIM purposes because the named insured cannot truly consent to their use.

3. Permissive‐Use Consent. Omnibus/permissive‐use language in § 33-6-31(a) mirrors the UIM definition’s “consent” requirement. Consent presumes ownership or control; a named insured cannot consent to their own non-owned vehicles. Therefore, non-owned vehicles lie outside the UIM statutory mandate.

Impact

Commercial Policies: Insurers are not compelled to offer UIM coverage on classes of non-owned vehicles associated with a business policy. They must still offer UIM for owned vehicles.
Policy Drafting: Clear declarations of which vehicles carry UIM coverage become critical. Businesses must affirmatively request UIM on non-owned fleets if desired.
Future Litigation: Insurers can rely on this ruling to defend against UIM claims by passengers in employees’ personal vehicles. Claimants must explore coverage under household or other policies.
Legislative Response: Should the Legislature wish to extend mandatory UIM offers to non-owned vehicles, statutory amendments will be necessary.

Complex Concepts Simplified

UIM Coverage: First‐party insurance protecting the policyholder (and certain others) when an at-fault driver’s liability limits are too low.
Class I vs. Class II Insureds: Class I are the insured’s household members (coverage “portable” anywhere). Class II are permissive users—but only of the specifically insured vehicle.
Omnibus Clause: A standard liability provision requiring that an insured’s consent extend coverage to others driving that vehicle. It does not create new vehicles to which UIM must attach.
Certified Question: A mechanism by which federal courts ask a state’s highest court to clarify state law when no controlling precedent exists.

Conclusion

Erie Ins. Co. v. Cooper establishes that under West Virginia Code § 33-6-31, an insurer issuing a commercial auto liability policy covering both owned and a class of non-owned vehicles is not required to offer UIM coverage on the non-owned vehicles. This decision underscores the statutory focus on the named insured’s own vehicles and ensures that UIM mandates remain tied to ownership and true permissive‐use consent. Commercial policyholders and their insurers will need to negotiate any additional UIM extensions explicitly, or depend on other household or personal auto policies for coverage gaps.