Expanded Underinsured Motorist Coverage for Permissive Users under WV Code § 33-6-31(c)

Introduction

Erie Insurance Property & Casualty Company v. James Skylar Cooper presents a significant dispute over the scope of underinsured motorist coverage in West Virginia. Pison Management, LLC purchased a liability policy from Erie that covered two company-owned vehicles and up to 25 vehicles owned by Pison’s employees, used with permission in the course of business. When employee Rick Huffman transported coworker James Skylar Cooper in Huffman’s personal vehicle—an “insured but non-owned” auto covered for liability—Cooper was severely injured by an underinsured tortfeasor. Erie refused to extend underinsured motorist benefits to Cooper, and the majority of the West Virginia Supreme Court sided with Erie. Chief Justice Wooton dissented, arguing that the majority’s interpretation deviates from long-standing state public policy favoring full indemnification of victims of uninsured or underinsured motorists.

Summary of the Judgment

The majority held that underinsured motorist benefits were not owed to a permissive user of a “non-owned” but insured vehicle absent explicit listing of that vehicle in the policy declarations. Their ruling drew heavily on Stone v. Liberty Mutual Ins. Co., 478 S.E.2d 883 (Va. 1996), concluding that (1) the statutory phrase “the motor vehicle to which the policy applies” refers only to vehicles specifically enumerated in the policy, and (2) an employer cannot give “expressed or implied consent” for an employee’s use of a personal vehicle because it lacks ownership or control over that vehicle. Consequently, Erie had no duty to offer or provide underinsured motorist coverage on Huffman’s car.

Analysis

Precedents Cited

Cunningham v. Hill (2010): Recognized West Virginia’s public policy of “full indemnification or compensation” for victims of uninsured/underinsured motorists.
State Auto. Mut. Ins. Co. v. Youler (1990): Reinforced that uninsured/underinsured motorist statutes are remedial and must be liberally construed.
Pristavec v. Westfield Ins. Co. (1990) & Perkins v. Doe (1986): Held that WV Code § 33-6-31(b) is remedial.
Starr v. State Farm Fire & Cas. Co. (1992): Defined Class II insureds (permissive users) under WV Code § 33-6-31(c).
Progressive Max Ins. Co. v. Brehm (2022): Reiterated the remedial purpose of underinsured motorist coverage to protect both named insureds and permissive users.
Stone v. Liberty Mut. Ins. Co. (1996, Va. Sup. Ct.): Virginia’s interpretation of analogous statutory language, holding that coverage applied only to vehicles listed in the policy and requiring employer control over the vehicle for consent.

Legal Reasoning

Chief Justice Wooton’s dissent emphasizes three core points:

Statutory Text and Scope: The phrase “the motor vehicle to which the policy applies” naturally includes any vehicle insured by the policy, not solely those listed by make/model in the declarations. Pison’s policy extended liability coverage to permissive-use vehicles of its employees. Thus Huffman’s car was indisputably “a vehicle to which the policy applies.”
Consent Inference: When an employer purchases liability insurance on an employee’s personal vehicle for business use, West Virginia law affords a compelling inference that the employer consented to that use. This aligns with the remedial purpose of § 33-6-31(c) to protect innocent victims, and mirrors the logic of Stone’s dissent.
Public Policy of Full Indemnification: West Virginia has consistently held that underinsured motorist statutes must be construed liberally to achieve full compensation for injured persons. The majority’s narrow reading conflicts with this principle, undermining the legislature’s intent and prior judicial pronouncements.

Impact

Adopting the dissent’s view would have broad implications:

It reaffirms permissive users’ entitlement to underinsured coverage when their use falls within the scope of a liability policy.
It discourages insurers and employers from imposing narrow declarations that undermine statutory intent.
It preserves West Virginia’s remedial public policy favoring full compensation for victims of underinsured motorists.
It aligns West Virginia law with a purposive, liberal construction of remedial insurance statutes.

Complex Concepts Simplified

Permissive User (Class II Insured): An individual who uses a vehicle with the owner’s express or implied consent and is covered under the policy for uninsured/underinsured motorist protection, even if not named on the policy.
Insured but Non-Owned Vehicle: A vehicle not owned by the named insured but nonetheless covered for liability (and, potentially, underinsured motorist) because the policy expressly extends coverage to it.
Full Indemnification: The principle that an injured party should be made whole—compensated for all losses not recovered from the negligent tortfeasor—up to the limits of available underinsured motorist coverage.
Liberal Construction: Courts must interpret remedial statutes broadly to effectuate their purpose, here ensuring full compensation to victims of underinsured tortfeasors.

Conclusion

Chief Justice Wooton’s dissent in Erie v. Cooper strikes at the heart of West Virginia’s long-standing policy of liberal, remedial interpretation of underinsured motorist statutes. By recognizing that any vehicle covered by a policy—whether specifically listed or not—constitutes “the motor vehicle to which the policy applies,” and that consent may be inferred from the act of procuring liability coverage, the dissent restores full indemnification rights to injured permissive users. This approach realigns the court with prior precedent and legislative purpose, safeguarding victims’ entitlements and deterring insurers from unduly restrictive policy drafting.