When the Other Driver Has Only $25,000 in Coverage: An Ohio UIM Case Study (Brummitt v. Seeholzer)

Published January 23, 2015 · Ohio Appeals Courts

On a September afternoon in 2010, Bobby and Faye Brummitt were riding along State Route 412 in Sandusky County with Bobby's brother and sister-in-law when a young driver named Dylan Seeholzer ran a stop sign and hit them. Their car flipped end over end and came to rest in a bean field. Everyone inside was seriously hurt. The sister-in-law died.

Bobby and Faye were flown to the hospital by helicopter, stayed about three weeks, and spent months in rehabilitation. Both wore cervical collars. Faye needed shoulder surgery. Bobby lost several teeth and broke out in stress-induced hives for months. Their medical bills, before any insurance discounts, came to $286,279.59.

The driver who caused all of it carried $25,000 in liability coverage.

The Sixth District Court of Appeals decided the Brummitts' case on January 9, 2015, in Brummitt v. Seeholzer, 2015-Ohio-71 (6th Dist.). It is not a Dayton case and it is not a blockbuster verdict. It is something more useful: a complete, start-to-finish picture of what an underinsured motorist claim looks like in Ohio, and why the coverage you buy for yourself can matter more than anything the other driver has.

The coverage gap, in real numbers

Ohio's minimum liability limits at the time of this crash were $12,500 per person. They went up to $25,000 at the end of 2013, as I explained in Ohio's Minimum Auto Insurance Doubled, and I argued then that the new number was still far too low. The Brummitts' case shows why. One helicopter ride and three weeks in a hospital will consume $25,000 before the first physical therapy appointment.

The Brummitts had done the one thing that protected them: they carried underinsured motorist (UIM) coverage on their own policy with Ohio Mutual Insurance Group, with a $500,000 limit. UIM coverage is the part of your own auto policy that pays when the at-fault driver's insurance is too small to cover your injuries. I walked through the basics in What Uninsured and Underinsured Motorist Coverage Is.

Under R.C. 3937.18(C), the UIM limit is reduced by what is available from the at-fault driver's liability coverage, a rule lawyers call the "setoff." So a $500,000 UIM policy against a $25,000 at-fault driver leaves up to $475,000 of additional protection. That is the difference between a family that is made whole and a family that absorbs a quarter million dollars in bills.

What the Brummitts had to prove

A UIM claim is not a claim that your insurer owes you money because you were hurt. It is a claim that you are "legally entitled to recover" from the other driver, and that your own insurer has agreed to stand in that driver's shoes up to the policy limit. R.C. 3937.18(D) makes the point directly: the insured must prove every element of the claim that would be needed to recover from the at-fault driver.

That means a UIM case is tried like an ordinary injury case. The Brummitts sued Seeholzer for negligence, sued the owner of the car for negligent entrustment, and sued Ohio Mutual for a declaration that they were entitled to UIM benefits. They also sued Ohio Mutual for bad faith, alleging it had failed to negotiate in good faith.

The six-day trial in April 2013 featured testimony from EMS personnel, treating physicians and surgeons, therapists, their dentist, family members, and damages experts. The jury awarded Bobby $63,222.64 in medical expenses, $130,500 for pain and suffering, $5,000 for future economic loss, and $15,000 for future noneconomic loss. It awarded Faye $70,719.50 in medical expenses and $65,000 for past pain and suffering. The total was $349,442.14, reduced by a $16,666.66 credit for each of them representing their share of Seeholzer's $25,000 policy. Judgment was entered for $316,108.82 plus interest.

The bad-faith claim was split off, and why that matters

Ohio Mutual asked the court to try the UIM damages claim first and the bad-faith claim later, in a separate trial. It argued that its claims file, which contains the adjuster's evaluations and the company's litigation strategy, would be discoverable in the bad-faith case but privileged in the damages case, and that forcing it to turn over that file while damages were still being tried would be unfair. The trial court agreed, and the Sixth District held that was within the court's discretion.

The practical effect is that in Ohio, an injured person pursuing both a UIM claim and a bad-faith claim will usually face two trials. The damages trial comes first, with the insurer defending the case much as the at-fault driver's insurer would. Only after that does the family get to see the claims file and argue that the insurer handled the claim unfairly. The Brummitts' bad-faith claim was still pending when the court of appeals ruled.

The insurer's offer is not evidence of what the case is worth

One detail in this case surprises almost everyone. Before trial, Ohio Mutual had offered $396,322.96 to settle both claims. The jury awarded less than that.

The Brummitts argued the offer amounted to an admission of what their damages were and that the jury's lower number was against the weight of the evidence. The court of appeals disagreed. Under Ohio Evidence Rule 408, an offer to compromise a disputed claim "is not admissible to prove liability for or invalidity of the claim or its amount." The court explained that settlement offers reflect more than damages; they also account for the cost and risk of further litigation. The offer could matter in the bad-faith trial, but it was not evidence of value in the damages trial.

There are two lessons here. First, an insurer's offer, high or low, tells you very little about what a jury will do, and a jury is free to reject even an insurer's own adjuster's assessment of damages. Second, when an insurer makes a substantial offer on a UIM claim, the decision whether to accept it deserves serious analysis, not just optimism. Juries are unpredictable, and a verdict can come in below the offer.

Medical bills and write-offs

Before trial, Ohio Mutual asked to put on evidence of the "contractual reductions," meaning the discounts health insurers negotiate so that a $286,000 bill is actually paid at a much lower figure. The trial court held that question in abeyance and tied it to how the insurer approached the issue at trial. That fight is now routine in Ohio injury cases after the Supreme Court's decision in Moretz, which I covered in Billed vs. Paid, and it is one more reason the medical-expense proof in a serious case has to be prepared carefully.

What this means for you

If you were seriously hurt by a driver with minimum coverage, three things from the Brummitts' case apply to you:

• Check your own policy today. UIM coverage is optional in Ohio, and insurers are not required to offer it. If you do not have it, or your limit is low, a $25,000 driver can leave you with nothing after the hospital is paid. A high UIM limit is the best insurance purchase most Ohio families can make.
• Act promptly. Many policies require UIM claims to be brought within three years of the crash, a deadline I warned about in The Three-Year UM/UIM Trap. A serious-injury claim takes time to document, so the clock matters.
• Expect your own insurer to defend the case. Once a UIM claim is on the table, your insurer's interests and yours diverge. It will scrutinize your medical bills, challenge causation, and send its own experts. The claim has to be built with the same care as a claim against a stranger.

Our uninsured and underinsured motorist practice handles exactly these cases, from the policy review through trial, and we do it with care.