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Georgia farmer cannot dig his way out of failure to obtain UM coverage

11/14/23

By: Lee D. Whatling and Philip W. Savrin

Is uninsured/underinsured motorist (“UM”) coverage imputed to one injured on a tractor that was not specifically scheduled on the policy and that was operating on a public road when it was struck by an automobile? In a reversal of the trial court, FMG secured a finding by the Georgia Court of Appeals that it is not. 

In Nationwide Agribusiness v. The Onionman Company, LLC et al., the insured attempted to get around its failure to obtain UM coverage for a tractor that was involved in an accident by claiming that the liability coverage provided under the policy was imputed by operation of Georgia’s UM statute. Under that statute, Onionman claimed, UM coverage that is not rejected in writing is imputed for the full amount of the liability insurance available for that vehicle. Because UM coverage was not rejected for the tractor, Onionman argued that the liability coverage provided for autos subject to “compulsory or financial responsibility law or other motor vehicle insurance law” applied. 

The trial court agreed with Onionman, but its reasoning was rejected by the appeals court. In a comprehensive published opinion, the Court of Appeals explained that UM coverage was not available under the plain language of the policy. The court based this conclusion on the fact that liability insurance is not mandatory for farm equipment such that the tractor did not qualify as an “auto” under the policy. In so finding, the Court rejected Onionman’s reliance on Hinton v. Interstate Guaranty Insurance Company, 267 Ga. 516, 480 S.E.2d 842 (1997), where the Supreme Court of Georgia found that UM coverage applied to a vehicle that was struck by an uninsured tractor. In contrast, the question in Onionman’s case was whether the driver of the tractor was entitled to UM coverage as the claimant. In answering that question in the negative, the Court of Appeals found that UM coverage could not be imputed from liability coverage that did not exist.  

Onionman also attempted to shoehorn an alternative argument that Nationwide somehow acted as its agent in procuring insurance. The appellate court did not bite, holding that there is no authority that imposes a “general duty upon an insurer, as opposed to an agent, related to the procurement of insurance that provides the coverage sought by the insured.” 

The published decision can be found at Nationwide Agribusiness Ins. Co. v. Onionman Co., LLC, No. A23A1161, 2023 WL 6936374 (Ga. Ct. App. Oct. 20, 2023). A petition for further review by the Supreme Court of Georgia is expected.  

For more information, please contact Lee D. Whatling at lwhatling@fmglaw.com, Philip W. Savrin at psavrin@fmglaw.com, or your local FMG attorney.