State Farm Fire & Casualty Co. v. David Stone, et al.

State Farm Fire & Casualty Co. filed a “Complaint for Declaratory Relief” with respect to the claim of David Stone seeking damages arising out of the death of his wife, Rhonda Stone,1 who was killed by the alleged negligent driving of an uninsured motorist. At the time of the accident, the Stones had a personal liability “umbrella” insurance policy with State Farm, which provided $1 million in personal liability coverage above and beyond the Stones’ underlying insurance policies, including their automobile liability insurance policy. Their umbrella policy does not, by its language, include uninsured motorist (“UM”) coverage. However, Mr. Stone argues that UM coverage should be read into their umbrella policy because the Stones did not reject such coverage in writing, which Mr. Stone says is required by the applicable statute. State Farm argues that the statute in question, Tenn. Code Ann. § 56-7-1201(a) (2000), applies only to automobile insurance policies and does not impose the rejection-in-writing requirement on umbrella policies. Based upon the parties’ “Agreed Stipulations,” the lower court, at a bench trial, agreed with Mr. Stone’s interpretation of the statute. We disagree with the interpretation placed upon the statute by Mr. Stone and the trial court. Accordingly, we reverse.