Mississippi Insurance Law – Part 3MISSISSIPPI Insurance-Related Law — An A to Z GuideHere’s the next post sharing our 2016 update. If you like a full copy or have any questions, please email or call.Excess VerdictsSee Bad Faith.ExclusionsIn 2015, Mississippi enacted an amendment to the definition of “proof of financial responsibility” and clarified that liability insurance “may contain exclusions and limitations on coverage as long as the exclusions and limitations language or form has been filed with and approved by the Commissioner of Insurance.” Miss. Code Ann. § 63-15-3(j) (as amended 2015). This amendment became effective July 1, 2015.This amendment was in reaction to the 2014 case of Lyons v. Direct General Ins. Co. of Mississippi, 138 So. 3d 887 (Miss. 2014), where the Mississippi Supreme Court held the named driver exclusion invalid to the extent it reduced liability coverage below the minimums required by law.The enactment of the amendment to § 63-15-3(j) statutorily abrogated the Lyons decision for all policies in effect after July 1, 2015, however, it is still controlling for policies pre-dating the amendment.In 2016, the legislature enacted a similar amendment permitting exclusions for carriers issuing SR-22 policies. Miss. Code Ann. § 63-15-43.Named Driver ExclusionThe 2015 amendment to the insurance statutes now permits the Named-Driver exclusion for liability policies in effect after July 1, 2015. See also, Exclusions.The “named-driver exclusion” was held invalid by the Mississippi Supreme Court in 2014, except as it applies above the minimum limits (currently 25/50/25). Lyons v. Direct General Ins. Co. of Mississippi, 138 So. 3d 887 (Miss. 2014). However, this case has now been abrogated by statute for purposes of policies in effect after July 1, 2015. The prohibition against this exclusion (for the minimum limits) is still valid for policies that pre-date the amendment.For UM purposes, however, it is not a valid exclusion for the minimum limits. See also Uninsured Motorist, Exclusions. Household ExclusionThe household exclusion was likely affected by the Lyons decision referenced above in the Named Driver Exclusion section. Lyons v. Direct General Ins. Co. of Mississippi, 138 So. 3d 887 (Miss. 2014). Since the enactment of the amendment to § 63-15-3(j), the case has been abrogated and exclusions and limitations for liability coverage are permitted after July 1, 2015.The Household Exclusion is not a valid exclusion for UM policies. Accordingly, an injured passenger may recover under a driver’s uninsured motorist policy where the household exclusion prevents recovery under liability policy. Allstate Ins. Co. v. Randall, 753 F.2d 441 (5th Cir. 1985).See also Uninsured Motorist, Exclusions. Family ImmunityInter-spousal immunity has been abolished in Mississippi. Burns v. Burns, 518 So. 2d 1205 (Miss. 1998).Parent-unemancipated child immunity has been abolished in negligent operation of automobile cases. Smith v. Holmes, 921 So. 2d 283, 285 (Miss. 2005). Parents may maintain suits against their children and vice versa. Ales v. Ales, 650 So. 2d 482, 487 (Miss. 1995). Family Purpose DoctrineThe Family Purpose Doctrine by which a family member’s negligence is imputed to another while driving an automobile has been expressly rejected in Mississippi. Prewitt v. Walker, 97 So. 2d 514, 516 (Miss. 1957); Smith v. Dauber, 125 So. 102, 103 (Miss. 1929).Financial Responsibility LawThe minimum liability coverages required by Mississippi law are 25,000/50,000/25,000.Mississippi’s financial responsibility statute, Miss. Code Ann. §63-15-43, provides, in part, that insurers “[s]hall pay on behalf of the insured named therein and any other person, as insured, using any such motor vehicle or motor vehicles with the express or implied permission of such named insured, all sums which the insured becomes legally obligated to pay as damages arising out of the ownership, maintenance or use of such motor vehicle . . . .” This statute, however, does not set the minimum coverage requirements for standard automobile policies. Instead, the requirement of minimum limits is found by turning to Miss. Code Ann. § 63-15-4 and §63-15-3(j). In these sections, we find the required minimum limits of 25/50/25. Since 2001, Mississippi has required motorists to carry minimum limits of liability insurance. Miss. Code Ann. §63-15-4 provides that every motor vehicle operated in this state shall have an insurance card maintained in the vehicle as proof of liability insurance that is in compliance with the liability limits required by §63-15-3(j). Miss. Code Ann. §63-15-3(j) defines “Proof of financial responsibility” as “proof of ability to respond to damages for liability, on account of accidents occurring subsequent to the effective date of said proof, arising out of the ownership, maintenance or use of a motor vehicle, in the amount of” $25,000 per person/$50,000 per accident because of bodily injury or death and $25,000 because of property damage in any one accident.”The insured may elect to obtain UM/UIM limits in at least the minimum provided for by the above statute and up to the limits of liability purchased. All policies are required to contain minimum UM coverage, unless rejected in writing by any named insured. Miss. Code Ann. § 83-11-101, et seq. Frivolous Lawsuits The court may order a party, his attorney, or both to pay the opposing party’s expenses, including attorney’s fees, if the court determines a motion or pleading is frivolous or filed in order to harass or delay. Miss. R. Civ. P. 11(b). See also, Litigation Accountability Act. Miss. Code Ann. § 11-55-5.______________________A word of caution is necessary whenever legal issues are at stake. The information contained in these posts is for general guidance on matters of interest only. The application and impact of laws can vary widely based on the specific facts involved. Given the changing nature of laws, rules and regulations, there may be omissions or inaccuracies in information contained in this report or laws may have changed or been reinterpreted. Accordingly, the information in this report is provided with the understanding that the authors are not herein engaged in rendering legal, tax, or other professional advice and services. As such, it should not be used as a substitute for consultation with legal or other competent advisers. Before making any decision or taking any action, particularly before denying any first-party claims, you should consult with your counsel or the attorneys at Holcomb Dunbar.
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