Defining “Payable” under Utah’s Underinsured Motorist Statute: Hinton v. Midwest Family Mutual Insurance

Introduction

In Hinton v. Midwest Family Mutual Insurance (2025 UT 4), the Utah Supreme Court confronted the interplay between two statutory schemes: Utah’s Workers’ Compensation Act and its underinsured motorist coverage statute. Haylee Hinton, injured on the job in a car accident caused by a third‐party motorist, pursued benefits first through workers’ compensation, then through the tortfeasor’s primary liability policy, and finally by arbitration under her employer’s underinsured motorist policy with Midwest Family Mutual Insurance (“Midwest”). Midwest sought a judicial declaration that Hinton could not recover those categories of injury‐related damages that are “paid or payable” under workers’ compensation. The district court agreed, excluding Hinton’s past and future medical costs and two‐thirds of her lost wages. On interlocutory appeal, the Supreme Court of Utah held that (1) the district court had subject‐matter jurisdiction to interpret the underinsured motorist statute; but (2) it misread the term “payable.” “Payable,” the Court explained, means benefits that are capable of being paid to a particular claimant in a particular case—not all categories of relief theoretically available under the Workers’ Compensation Act. The Court vacated the district court’s order and remanded for further proceedings.

Summary of the Judgment

Jurisdiction: The Supreme Court confirmed that a district court may entertain a declaratory judgment on the scope of underinsured motorist coverage without usurping the exclusive province of the Utah Labor Commission over workers’ compensation awards.
Statutory Interpretation: Utah Code § 31A-22-305.3(4)(c)(i) excludes from underinsured motorist coverage “any benefit paid or payable under” the Workers’ Compensation Act, but does not prohibit recovery of benefits that workers’ compensation has denied or closed in a particular case.
Meaning of “Payable”: The word “payable” refers to benefits that may or can be paid to the covered person in that case—i.e., those the claimant has not yet definitively been awarded or barred from receiving under workers’ compensation.
Disposition: The Court vacated the district court’s order excluding all medical expenses and two‐thirds of lost wages, and remanded so the district court may determine which benefits remain “payable” to Hinton in her specific workers’ compensation proceedings.

Analysis

Precedents Cited

Sheppick v. Albertson’s, Inc., 922 P.2d 769 (Utah 1996): Held that only the Labor Commission may determine the amount of workers’ compensation benefits, but subsequently clarified by Granite School Dist. v. Young (2023 UT 21) to mean that district courts may interpret related statutes without awarding compensation.
Truck Insurance Exchange v. Rutherford, 2017 UT 25: Interpreted “secondary” in the underinsured motorist statute to mean coverage applies only after workers’ compensation is exhausted, prompting later legislative amendments.
Neel v. State, 889 P.2d 922 (Utah 1995): Addressed PIP offsets by workers’ compensation benefits but did not define “payable” in the same statutory context.
Anderson v. United Parcel Service, 2004 UT 57: Described the subrogation and reimbursement mechanics of third‐party recoveries after workers’ compensation advances under Utah Code § 34A-2-106(5).

Legal Reasoning

The Court’s statutory interpretation proceeded in three main steps:

Plain‐Text Analysis: While “payable” commonly means “may be paid,” the Legislature’s pairing of “paid or payable” indicates added scope beyond amounts already disbursed. The term must be read in context with definitions of “covered person” and the overall structure of underinsured motorist coverage as “excess” protection.
Contextual Harmony: Utah Code § 31A-22-305.3(2)(a) authorizes underinsured motorist benefits for those “legally entitled to recover damages” from an underinsured tortfeasor. Subsection (4)(c)(i) qualifies that entitlement only to the extent that those damages are “paid or payable” under workers’ compensation in that claimant’s own case. A categorical bar on all potential workers’ compensation categories would render coverage illusory in many facts patterns.
Legislative History & Subsequent Amendments: The 2018 amendment repealed Rutherford’s “secondary” language to prevent permanent‐disability claimants from being left without underinsured motorist relief. The 2024 amendment further clarified that exhaustion is not required and rephrased the exclusion to “benefits … provided by” workers’ compensation carriers—confirming that only actually provided (or capable) benefits should be excluded.

Impact on Future Cases and the Area of Law

Hinton v. Midwest Family Mutual Insurance will guide Utah courts as follows:

Underinsured motorist insurers may only offset benefits that workers’ compensation has actually provided—or remains capable of providing—to the claimant under the Act in that case.
Claimants retain access to underinsured motorist remedies when their workers’ compensation claims are denied or closed, so long as those benefits become non‐payable to them.
District courts have jurisdiction to interpret the overlap between workers’ compensation and motorist‐coverage statutes without deciding entitlement to compensation benefits.
Policyholders and insurers must track the status of workers’ compensation claims before arbitration of underinsured motorist disputes to ascertain which benefits are “payable.”

Complex Concepts Simplified

Underinsured Motorist Coverage: An insurance layer that pays the “gap” between the at-fault driver’s liability limit and the policy limits the injured party purchased.
Workers’ Compensation Benefits: No‐fault coverage for work‐related injuries, providing medical care and two‐thirds of lost wages but excluding pain and suffering.
Offset/Subrogation: Underinsured motorist insurers can subtract (“offset”) workers’ compensation payouts from what they owe, but only to the extent those payouts are “paid or payable” to the same injured individual.
Interlocutory Appeal: A discretionary appeal from a non–final order; Utah’s rules permit direct appeals of certain pretrial decisions.

Conclusion

Hinton v. Midwest Family Mutual Insurance clarifies that, under Utah law, an underinsured motorist insurer may exclude only those workers’ compensation benefits that have actually been—or remain capable of being—paid to the particular claimant. The decision rejects categorical exclusions of broad benefit categories and affirms district court jurisdiction to interpret coverage scopes. By vacating the lower court’s blanket offset of Hinton’s medical costs and two‐thirds of her lost wages, the Supreme Court has ensured that injured workers in Utah will not lose underinsured motorist relief simply because their workers’ compensation claims have been closed or denied. The case refines the interaction between two complementary insurance schemes and establishes a claimant‐specific approach to determining “payable” benefits.