INSURANCE-RELATED COURT CASES
Digested from case reports published online
UIM case sparks dispute
Sherry Glassman had both an automobile liability and an umbrella policy with Safeco Insurance Company of America. Glassman sustained significant bystander emotional distress damages after witnessing her mother’s fatal injuries when an underinsured (UIM) driver hit them both while they were walking together in a crosswalk.
Glassman prevailed in a UIM arbitration against Safeco. The arbitration agreement was contained in Glassman’s umbrella policy that provided excess benefits over and above those afforded by Glassman’s concurrent auto liability policy. The arbitrator’s award, later confirmed by the superior court, determined that Glassman’s compensable damages resulting from the accident exceeded the required threshold to entitle her to the umbrella policy excess UIM limits of $1 million.
Before the arbitration hearing and award, Glassman had issued to Safeco a CCP section 998 offer in the amount of $999,999.99, one cent less than the policy limits. Safeco did not accept the offer, on which Glassman prevailed when the arbitrator later ruled that she was entitled to the $1 million umbrella policy limits.
After Glassman petitioned the trial court to confirm the arbitration award, she also sought prejudgment interest from the date of her CCP section 998 offer. The trial court denied Glassman’s request for prejudgment interest under section 3287(a), concluding that the amount of her policy limits claim for excess UIM benefits was not certain or capable of being certain, and this uncertainty was not fixed by Glassman’s CCP section 998 policy limits offer. Glassman appealed.
On appeal, Glassman challenged only the court’s denial of prejudgment interest. She urged that to promote settlement and fair treatment of an insured by an insurer, an insured’s prevailing CCP section 998 in a UIM proceeding effectively liquidates the insured’s claim in the amount and as of the date of the offer, mandating an award of prejudgment interest. The court rejected this contention, concluding that neither section 3287(a) nor section 998, taken separately or together, so provide. The court affirmed the trial court’s judgment.
Glassman v. Safeco Insurance Company of America—Court of Appeal of the State of California, Sixth Appellate District—April 28, 2023—No. 21CV383782.