On certification to the Superior Court, Appellate Division
For reversal and remandment -- Chief Justice Wilentz and Justices Schreiber, Handler and O'Hern. Dissenting -- Justices Clifford and Pollock. The opinion of the Court was delivered by Schreiber, J. Clifford, J., dissenting. Justice Pollock authorizes me to record his concurrence in this dissenting opinion.
These two cases, involving substantially similar factual patterns, raise the question of the extent of uninsured motorist coverages under a single automobile liability policy covering three automobiles.
Harvey Washington purchased an automobile liability policy from Allstate Insurance Company (Allstate) in September 1976. The policy insured three automobiles, a 1966 Chrysler, a 1964 Pontiac, and a 1966 Pontiac. Plaintiff Phyllis Isom, an additional insured under the Allstate policy, was a passenger in an automobile that collided with an uninsured car. Accordingly, she was entitled to the benefit of the uninsured motorist provision in the Allstate policy. The face sheet of the policy referred to the three insured vehicles and indicated that each was covered by the uninsured motorists provision in the amount of $15,000
per person. The plaintiff sought recovery of $45,000. Allstate asserted that its policy limited recovery to $15,000.
The disputed claim was submitted to arbitration in accordance with the policy's provisions. The arbitrator awarded the plaintiff $45,000. The trial court, granting defendant's motion for summary judgment and denying plaintiff's motion for summary judgment, limited the award to $15,000. The Appellate Division affirmed. We granted plaintiff's petition for certification. 91 N.J. 207 (1982).
There are two aspects to this claim. One involves the statutory requirements governing uninsured motorist coverage. These must be embodied in the insurance policy and cannot be contracted away. Even if the statutory requisites are not set forth, they are deemed to have been included in the policy. Nor may policy provisions conflict with those statutory requirements. The second aspect concerns provisions of the insurance policy. In this respect the focus of attention is the coverage that the policy affords, irrespective of the statutory minima.
Each automobile must be insured, N.J.S.A. 39:6A-3, and "[e]very motor vehicle registered or principally garaged in New Jersey must be insured with Uninsured Motorist Coverage on and after January 1, 1973." M. Iavicoli, No Fault & Comparative Negligence in New Jersey 100 (1973) (emphasis in original); N.J.S.A. 39:6A-14. Thus, not only must every automobile policy have uninsured motorist coverage, N.J.S.A. 17:28-1.1, but also every automobile covered under that policy must have the statutorily required uninsured motorist coverage.
Neither party questions that under N.J.S.A. 17:28-1.1 automobile liability policies must include a provision that the insured or his legal representative shall be entitled to recover damages sustained in an accident with an uninsured automobile if the owner or operator of the uninsured automobile is legally responsible. This liability exists irrespective of whether the insured vehicle was involved in the accident. This interpretation of the statute has been adopted by this Court in Motor Club
of America Insurance Co. v. Phillips, 66 N.J. 277 (1974),*fn1 Beek v. Ohio Casualty Insurance Co., 73 N.J. 185 (1977), and Ciecka v. Transamerica Insurance Group, 81 N.J. 421 (1979). N.J.S.A. 17:28-1.1 reads as follows:
No automobile liability policy or renewal of such policy, of insurance insuring against loss resulting from liability imposed by law for bodily injury or death, sustained by any person arising out of the ownership, maintenance or use of a motor vehicle shall be issued in this State with respect to any motor vehicle registered or principally garaged in this State unless it includes coverage, in limits for bodily injury or death as follows:
a. an amount or limit of $15,000.00, exclusive of interest and costs, on account of injury to, or death of, one person, in any one accident, and
b. an amount or limit, subject to such limit for any one person so injured or killed, of $30,000.00, exclusive of interest and costs, on account of injury to or death of more than one person, in any one accident,
under provisions approved by the Commissioner of Insurance, for payment of all or part of the sums which the insured or his legal representative shall be legally entitled to recover as damages from the operator or owner of an uninsured automobile, or hit and run automobile as defined in section 18 of chapter 174 of the laws of 1952 (C. 39:6-78), because of bodily injury, sickness or disease, including death resulting therefrom, sustained by the insured, caused by accident and arising out of the ownership, maintenance or use of such uninsured or hit and run automobile anywhere within the United States or Canada. All such automobile liability policies shall also include coverage for the payment of all or part of the sums which persons insured thereunder shall be legally entitled to recover as damages from owners or operators of uninsured automobiles, other than hit and run automobiles, because of injury to or destruction to the personal property of such insured with a limit in the aggregate for all insureds involved in any one accident of $5,000.00, and subject, for each insured, to an exclusion of the first $100.00 of such damages.
Justice Handler pointed out in Fernandez v. Selected Risks Insurance Co., 82 N.J. 236, 241 (1980), that:
[t]he statute contains no language requiring . . . that the insured have any special relationship with the vehicle that he is operating or in which he is a passenger. All that N.J.S.A. 17:28-1.1 demands is that the insured demonstrate that he has sustained injuries which were caused by an uninsured automobile.
An automobile liability policy must provide not only coverage for liability related to the insured vehicle, but also coverage to
the insured for injuries caused by an uninsured automobile. As one commentator has observed: "unlike liability insurance, uninsured motorists' coverage is not linked to accidents that occur while the insured is operating or occupying a specified vehicle." 2 I. Schermer, Automobile Liability Insurance § 31.02, at 31-8 (2d ed. 1981).
This statute has two purposes: to relieve the financial burden on the Unsatisfied Claim and Judgment Fund and to protect insured motorists from uninsured financially irresponsible drivers. This statutory protection may also be extended to persons other than the named insured when the insuring company has contractually extended the coverage in the policy. Fernandez v. Selected Risks Insurance Co., 82 N.J. ...