In Newman v. Cornerstone National Ins. Co., No. CV-14-0121, _____P.3d ____, 2015 WL 1223733 (Ariz. 2015), the Arizona Supreme Court recently ruled that the statute requiring insurers to offer underinsured motorist coverage when selling motor vehicle liability policies does not require the insurer to provide a quote for the cost of the additional coverage.
In Newman, the policyholder sought indemnification from her insurer when an at-fault driver’s insurance was insufficient to cover her injuries from an automobile accident. Id. at *1. Although the policyholder waived underinsured motorist coverage, she argued that the waiver form she signed was void because the insurer had not made an effective offer of underinsured motorist coverage, as required under A.R.S. § 20-259.01(B). Id. *1. The policyholder argued that, to be effective, the insurer’s offer must include all “material terms” of the proposed underinsured motorist coverage, including the cost of the coverage. Id.
The Arizona Supreme Court disagreed, holding that the meaning of “offer” in the context of the statute was clear, and did not require the insurer to include a premium quote. Id. at *2. The court reasoned that although providing a quote might be useful and would encourage insureds to obtain additional protection, nothing in the statute required such information, and the court would not re-write the statute to add new requirements. Id.
The court’s ruling is important because it clarifies the scope of insurers’ obligations under Arizona’s underinsured motorist statute and affirms that the court will not impose additional requirements specifically identified in the statute.