There have a series of New Mexico Supreme Court opinions over the last 10 years expanding the duties on insurers to obtain proper rejection of uninsured/underinsured coverage motorist coverage (UIM).

The first of the opinions during that time was the 2004 case of Montano v. Allstate, which dealt with the proper rejection of stacking coverage.  Following on that opinion, there were a series of other opinions addressing the proper rejection of UIM coverage.

Retroactivity of Cases on Rejection of UIM Coverage 

The cases and the expanding obligations on insurance companies were made retroactive in Jordan v. Allstate.  However, the Court did not indicate how far back retroactive application of the new obligations would go.

The most recent case of Whelan v. State Farm addresses this issue along with a very good discussion of the evolution of rules regarding the rejection of UIM coverage.

Statute of Limitations 

First, it should be noted that the statute of limitations on written contracts in New Mexico is 6 years.  Because underinsured motorist coverage is a written contractual provision, a breach of this provision would have a 6-year statute of limitations.

The question then becomes when does the statute of limitations begin to run?  The Whelan case addresses this issue consistently with prior cases holding that the statute of limitations begins to run on the date that an uninsured or underinsured motorist claim is denied.

In the Whelan case, the insurer had attempted to limit the statute of limitations by inserting a provision in the contracts stating that it would be begin to run on the date of the accident.  The court refused the argument since the insured party likely would not know of the need for a UIM claim at that time, so it would be unjust to allow the statute of limitations to begin running on this earlier date.

The Court, recognizing the 6-year statute of limitations and it commencement upon rejection of coverage, then had to determine how far back retroactivity would apply.

Retroactivity Back Only to 2004 Montano Decision 

The Court, after lengthy discussion, found that the spate of cases expanding the duties of insurers on the proper rejection of UIM coverage would only go back to 2004, the date of the Montano decision.

The Court acknowledged that the laws regarding UIM and the laws and regulations over the insurance industry were meant to protect the consumer insured, not the insurance companies.  On the other hand, the Court found that it would be unjust to allow retroactivity beyond 2004 since the insurance companies had no reason to know of the enhanced requirements regarding the rejection of UIM coverage until the Montano decision.

Retroactivity Will Not Apply to Policies Entered Prior to 2004 

Based upon its analysis of the evolution of the law on the rejection of UIM coverage, the law on statutes of limitations and statutes of repose, and the retroactive application of civil case law, the Court determined that the heightened obligations on the proper rejection of UIM coverage would not apply to policies entered in prior to the 2004 Montano decision.

Review Your Prior Settlement

If you had an auto accident claim, and there was a UIM claim made, and your policy was entered after 2004, it is advisable to have an experienced automobile insurance attorney review your file.

Most insurance companies have been sending out notices to its auto insurance customers who had auto accident claims.  It is not clear how far back they have gone to notify these customers.  It appears that they would have the obligation to notify all such drivers with policies dated after the 2004 Montano decision.

However, do not wait for notice from your insurance company.  It is also not clear that all insurance companies are sending out these notices.  It is important to take action as soon as possible.  The statute of limitations is always running so it is never a good idea to delay.

There have been numerous cases over the last few years from the New Mexico Appellate courts dealing with the rejection of uninsured/underinsured motorist coverage (UM/UIM).  Over the years, a number of strict requirements have been placed on insurance companies for the rejection of UN/UIM coverage by insureds.

Among the most important requirements are that the rejection be in writing, signed by the insured and made a part of the policy. In addition, the courts have required that the different premium rates for coverage with and without uninsured/underinsured coverage be stated in the policy so that the insured could make an educated decision on whether or not to reject the coverage.

These requirements are now well established. However, the exact form of these requirements has not yet been firmly specified. This lack of specificity led to the recent New Mexico Court of Appeals case of Curry v. Great Northwest Insurance Co.. Specifically, the Court had to address what form and where the disclosure of different premiums had to be placed in the policy in order for a rejection of coverage to be valid.

In this case, the policyholder argued that the competing premium rates had to be placed on the signed rejection form under Jordan v. Allstate. The insurer argued that this was not the case and that  the competing premiums merely had to be placed within the insurance application.

The Court of Appeals agreed with the insurer stating that the Jordan v. Allstate made no such requirement that the premium rates be stated on the rejection form itself. It should be noted that that neither the insured nor the Court of Appeals disputed the requirement that UM/UIM coverage options and premiums be provided to the insured. Nor was it disputed by the parties that the coverage options and rates were provided to the insured. The only question was where that information needed to be disclosed.

New Mexico public policy strongly favors UM/UIM coverage on every automobile in the state. The default rule is to provide the maximum level of UM/UIM possible under the policy and any ambiguity should be construed in favor of the insured. Any rejection of UM/UIM coverage should be made knowingly and intelligently. This means that the coverage options must be fully disclosed to the insured.

The Court set forth the requirements of Jordan v. Allstate upon which much of the dispute in Curry v. Great Northwest Insurancewas centered as follows:

“(1) offer[s] the insured UM/UIM coverage equal to his or her liability limits, (2) inform[s] the insured about premium costs corresponding to the available levels of coverage, (3) obtain[s] a written rejection of UM/UIM coverage equal to the liability limits, and (4) incorporate[s] that rejection into the policy [delivered to the insured] in a way that affords the insured a fair opportunity to reconsider the decision to reject[.]”

The Court in Curry agreed that though Jordan placed great emphasis on the requirement of a writing and full disclosure of policy coverage options,  the Jordan case, “did not address every method insurers may use to provide this information or the validity of those methods.”

The Court thereby concluded that the coverage options and corresponding premium information did not need to appear on the rejection form but simply needed to be part of the policy. The Court reiterated that there is no “one particular way the information must be provided.”

The lack of specificity will likely have a number of consequences. First, there was a dissent filed in the this case indicating a very high likelihood that the case will be appealed to the New Mexico Supreme Court. Second, assuming that the Court of Appeals’ opinion holds up, one may safely assume that some insurers will do their level best to bury the coverage and premium options deep inside the policy.

As we have stated time and time again, uninsured/underinsured motorist coverage is absolutely essential in New Mexico which has among the highest rates of uninsured motorists in the country. This coverage will likely be all the coverage available in case of an auto accident. Even if there is coverage, there will likely be only the minimal $25,000 required under New Mexico law.

In short, do not reject UM/UIM coverage. If further persuading is necessary, ask yourself why it is that the is that the Courts must place so many restrictions on the rejection of coverage and the consequent loss of premiums to the insurance company. And if the friendly insurance agent offers you these savings on premiums, politely decline!

Uninsured/Underinsured motorist coverage (UM/UIM) is extremely important for drivers. This is particularly so in New Mexico which has a very high rate of uninsured drivers. Many more are underinsured carrying on the legal minimum of $25,000 in liability coverage.

In cases of auto accidents causing serious personal injuries or death, there is very good possibility that the only true protection will be in the form of UM/UIM. And much of that protection will come in the form of stacking of UM/UIM coverages across multiple policies.

Stacking of UM/UIM Coverage

Stacking of coverage as suggested allows for those injured in an auto accident to combine the coverages from multiple vehicles insured within the home. For example, if there are 3 cars in the home each with coverage of $25,000, the total available UM/UIM is $75,000. As may easily be seen, stacking is often essential for any meaningful recovery in cases of serious injury or death.

The recent New Mexico Court of Appeals case of Arias v. Phoenix Indemnity took up the issue of stacking in the context of an invalid rejection of UM/UIM coverage. The New Mexico courts have been fairly aggressive in protecting consumers against the uninformed rejection of UM/UIM coverage.

Rejection of UM/UIM Must be in Writing and Attached to Policy

The Courts have put significant requirements on insurance companies to provide information in writing and signed by the insured showing a knowing and informed rejection of UM/UIM coverage. Notably, the Court in its previous ruling between the same parties in Arias v. Phoenix Indemnity case found that a rejection of UM/UIM was defective even though it was in writing because it had not been attached to the policy.

In that case, the insured was found to have UM/UIM coverage despite a signed rejection because the rejection had not been properly attached to the policy. This gave rise to the current appeal as to whether the insured would receive the full benefits of stacking across multiple vehicles, again as a result of the invalid rejection.

The Court of Appeals found that the insured was fully entitled to stacking due to the invalid rejection. Like any other rejection of UM/UIM, a rejection of stacking must be in writing and attached to the policy. It should be noted that the default allows for stacking unless properly rejected by the insured.  As such, in the absence of a valid rejection, the insured will be entitled to full UM/UIM coverage including stacking.

Very Strong New Mexico Policy in Favor of UM/UIM

New Mexico’s has a very strong policy in favor of expansive protection of policy holders with respect to UM/UIM. The Court stated the policy as follows:

“Our Supreme Court further stated that the UM/UIM statute “embodies a public policy of New Mexico to make uninsured motorist coverage a part of every automobile liability insurance policy issued in this state,” and “[t]he statute was intended to expand insurance coverage and to protect individual members of the public against the hazard of culpable uninsured motorists… the statute should be liberally interpreted in order to implement its remedial purpose, and the language in the statute that provides for an exception to UM/UIM coverage should be construed strictly to protect the insured.”

Thus the Court stated that the “default position of our courts is that any rejection of coverage that is found to be invalid … results in courts reforming the insurance policy in question by reading into it UM/UIM coverage as if it was fully provided at the level of policy limits to the insured in the first instance.”  Again, this includes the full protection of stacking which was also not properly rejected

Insurance Companies Will Continue Efforts to Deny UM/UIM

This is good news for insurance buyers. However, consumers should be aware that some insurance companies will do their level best to obtain a valid rejection of not only UM/UIM but also stacking.

The Court of Appeals actually addressed what will likely become a trend and/or policy for some insurers where one policy will be issued for multiple vehicles with a written rejection of stacking across all policies.  Do not agree to this!

Do Not Reject Uninsured/Underinsured Motorist Coverage!

Purchasers of auto insurance should not sign any waiver of UM/UIM whatsoever including stacking. If you have any doubts, ask yourself why it is that insurers would go to such lengths to obtain rejections of UM/UIM thereby giving up a premium.  The simple answer is that UM/UIM is perhaps the best deal in coverage.

The bottom line is there is absolutely no good reason to waive UM/UIM coverage while there is one very important reason not to and that is the health and welfare of you and your loved ones.

The Weed Warrior line of cases has opened up a wave of claims against auto insurance companies for the past denial of uninsured/underinsured motorist coverage. As a result of the Weed Warrior and the cases leading up to it, insurance companies and drivers alike are scrambling. One issue that has yet to be resolved entirely is what exactly is the statute of limitations on these claims?

For some background, Weed Warriors and the many other appellate court cases addressing the rights of drivers in UM/UIM coverage situations sets forth the duties of insurance companies in obtaining waivers of UM/UIM coverage. In a nutshell, in order for a waiver to be effective, there are numerous hurdles that auto insurance companies must overcome.

The gist of these cases is that the insured driver must fully understand and agree to the waiver. The reason for this is simple, UM/UIM is about the only bargain that a driver will get when purchasing insurance. In fact, the coverage is both essential in New Mexico which has the highest rate of uninsured drivers in the country and inexpensive. Simply put, it is a better deal for the driver than the insurance company.

These facts have led to many insurance companies duping drivers into waiving this essential and inexpensive coverage. As a result, there has been a wave of cases over the past several years requiring that waivers be in writing, fully disclosed and signed by the insured driver. Weed Warriors took this one step further requiring insurance companies to offer UM/UIM, disclose the costs of UM/UIM coverage and the difference in premium that would result from the waiver. In short, it must be a knowing waiver of coverage.

There is a strong public policy in New Mexico of requiring drivers to carry insurance. There is an equally strong policy in light of the high rate of uninsured drivers of providing UM/UIM in the event that an uninsured or underinsured motorist causes injuries to others. These policies are clear from the recent New Mexico Appellate Court decisions.

Equally clear is that many UM/UIM claims have been wrongfully denied in the past by these high standards. The court decisions make clear that the decisions are retroactive meaning that past wrongful denials must be remedied. This has resulted in thousands upon thousands of letters being sent by highly conscientious insurers to their insured drivers on past car accidents. These went out pretty early after the Weed Warrior cases. Unfortunately, many less conscientious insurers have failed to do likewise.

This leads to the very important question and the subject of this post (if not yet apparent) of when the statute of limitations will run on these claims. The statute of limitations will be governed by the 6 year statute of limitations applying to contracts. The question becomes when does the 6 years begin to run?

The insurance companies are taking the position that the claims run 6 years from the date of the accident. Plaintiff‘s attorneys that represent those drivers wrongfully denied UM/UIM take the position that the 6 years begins to run from the date of the wrongful denial. This issue will likely be the subject of the next round of UM/UIM appellate court decision.

The outcome will make a huge difference to both insured drivers and to the insurance companies. The important thing for insured drivers facing this situation to take from this is that whatever the outcome on this dispute, there is a deadline under the statute of limitations. Missing the deadline will result in a denial of claims. It would be most prudent to assume that the deadline will be the shorter of the two beginning from the date of the accident. To assume otherwise may result in a complete bar to past UM/UIM claims.

If you are facing this situation, you should immediately contact a personal injury attorney with experience in insurance and specifically UM/UIM insurance claims. Delay in addressing these matters could be fatal to your claims. Indeed, this is what some insurance companies are no doubt hoping.


Recently, the United States District Court for the District of New Mexico dealt a harsh blow to automobile insurers when it forced an insurance company to provide uninsured motorist coverage to a woman who had signed a form turning down the coverage.

This decision upheld New Mexico‘s strict rules addressed in several previous posts requiring specific types of disclosures and notices to be given to anyone who is turning down uninsured/underinsured coverage (UM/UIM coverage). Because in this case the insurer, Nevada General, hadn‘t complied with all of New Mexico‘s requirements for waiver of coverage, it was forced to pay the benefits.

The facts of Nevada General v. Encee are pretty straightforward. The insured plaintiff was covered by a Nevada General auto policy that provided only bodily injury liability coverage that would cover her in the event she was negligent and injured someone else. She was then injured in an accident where the other driver had no insurance coverage.

Ms. Encee requested UM/UIM insurance benefits to cover her injuries even though UM/UIM coverage was not in her policy. Nevada General refused to provide coverage because Ms. Encee had refused the coverage in writing and signed a form stating in three different places that she did not want UM/UIM insurance. However, the form did not exactly comply with New Mexico‘s strict requirements for a “knowing” waiver, as set out in Jordan v. Allstate. Specifically, the form failed to set out the difference in Ms. Encee‘s premium costs relating to the cost of her insurance with and without UM/UIM coverage, which was required by the New Mexico Supreme Court in Jordan. The federal court forced Nevada General to provide the UM/UIM coverage to Ms. Encee even though she never paid for it.

Nevada General argued that being required to provide UM/UIM insurance coverage to Ms. Encee was unconstitutional. Nevada General claimed that the court‘s enforcement of the New Mexico UM/UIM waiver requirements imposed an illegal “taking” under the Fifth and Fourteenth Amendments of the United States Constitution and that it violated the “Contract Clause” of the United States Constitution. Both of these arguments were flatly rejected by the federal court.

Although, it may seem extreme, this decision upholds New Mexico common law protection of individuals who are entitled to uninsured motorist coverage when insurance companies do not provide enough information for them to make a decision about whether they want to purchase coverage. All too often, companies play fast and loose with the disclosure requirements and then deny coverage, claiming that the individual never asked for this very important benefit. Many times, people don‘t realize that they did not have this coverage until it is too late. In New Mexico this can be disastrous in light of the high number of uninsured and underinsured drivers in the state.

If you have been denied coverage for uninsured or underinsured motorist insurance in New Mexico and you believe that you are entitled to it, you very well may have a claim. In fact, even if you settled your claims in the past, were denied uninsured/underinsured coverage, and the claim has long been closed, you may have a claim against your own insurance company for UM/UIM coverage up to the your liability limits.

If you have been denied UM/UIM coverage now or in the past, you should contact at attorney experienced in UM/UIM insurance coverage issues. Collins & Collins is experienced in handling all types of automobile injury cases and is well-informed on the issues relating to UM/UIM coverage.


Uninsured or Underinsured motorist coverage (UIM) is an important optional coverage offered by insurance companies. UIM provides coverage for an insured when the insured is in an automobile accident that is another party‘s fault and either the at-fault party has no insurance or does not have sufficient insurance coverage to compensate the insured fairly for his injuries and damages.

Because the insurance policy is a contract, there are terms and conditions that the insured must follow so that the insurer is obligated to meet the terms of the insurance coverage. One term or condition in most every automobile insurance policy is the requirement that the insured obtain approval from his insurer to settle a personal injury claim for damages against an at-fault party IF the insured intends to bring a claim under his own insurance policy, or under a policy that he has coverage, for underinsured motorist coverage benefits.

The reason for this requirement is that when an insured settles a claim against a liable party and signs a release agreement that releases that person from any further liability or claims that arise from the accident, the insured‘s insurance company cannot bring a claim in the future against the liable party in subrogation of payments the insurance company may pay for its insured. In subrogation claims, the insurer “stands in the shoes” of its insured so that any claims the insured may have, the insurer also has. When the insured releases a negligent party for damages, neither he nor his insurer may bring any further claim for damages or reimbursement, in the case of the insurer.

The 2007 New Mexico Court of Appeals case of Salas v. Mountain States Mutual Cas. Co., reaffirmed past cases that established the insured‘s duty to obtain permission from its insurer to settle a liability claim when the insured intended to bring an UIM claim. The Court concluded that the insured‘s settlement of the claim and release of the tortfeasor extinguished the insurer‘s subrogation rights and triggered a rebuttable presumption of prejudice. “Rebuttable presumption” meaning, that if the insured could demonstrate that the insurer was not prejudiced, the insured‘s failure to obtain permission would not be a bar to bringing the UIM claim. One situation that would rebut the presumption of prejudice is the situation wherein the tortfeasor is judgment proof and the insurer would not be able to recover any money paid in subrogation even if the insured had not released the at-fault party.

An interesting twist in the Salas v. Mountain States case is that, ultimately, Ms. Salas, a passenger in the insured vehicle and therefore Class 2 insured, was able to bring her UIM claim because she was not aware that there were UIM benefits available. Ms. Salas had made a claim under the Mountain States policy for medical payments coverage, but was not aware that there was also uninsured/underinsured motorist coverage. Because Mountain States had failed to advise her of the availability of UIM benefits, the Supreme Court ruled that under the circumstances of the case, the insurer could not deny Ms. Salas‘ ability to make the UIM claim.

Auto accidents can raise some confusing and significant insurance issues. There have been numerous developments in the courts over the last few years regarding the obligations of insurers in UIM cases. If you have been involved in a car accident where UIM issues are raised, you should seek the guidance of an experienced personal injury attorney.


Most consumers purchase automobile insurance to protect themselves or their family in case of an auto accident. Some purchase auto insurance because it is the law, mandated by the state legislature.

In New Mexico, drivers must maintain minimum insurance policy limits of $25,000 per person, $50,000 per occurrence and $10,000 for property damage. This means that if you are in an accident that you cause, an injured party can make a claim against your insurer for a maximum of $25,000 for the individual‘s injury. The total amount of coverage available is $50,000 per occurrence, meaning that even if there are numerous parties injured, the total paid by your insurance company to all claimants together is $50,000.

States require minimum insurance coverage under a public policy theory that insurance protects motorists for the risk of driving. Insurance coverage protects both those injured in the accident and the person who causes the accident who can be held financially responsible.

However, it is obvious that these minimum amounts do not necessarily protect injured parties when there is significant injury or when there are numerous injured parties. Similarly, minimum liability coverage does not necessarily protect the person at fault for the accident as the person will be held personally responsible for damages incurred by injured parties in excess of his insurance coverage. Consequently, minimum insurance coverage is a benefit in many situations, but certainly not all.

It is also important for consumers to understand what their insurance coverage actually pays for. Liability insurance is insurance paid to a claimant for damages caused by the insured. The insured, if he is injured in an accident for which he is at fault, cannot seek compensation under the liability coverage of his policy. Likewise, without certain elective coverage, he cannot seek any recovery from his own insurance company even when the accident was not his fault. The only coverages that are available in these situations are optional coverages, such as medical payments coverage or uninsured motorist coverage. Without these optional coverages even if the insured is not at fault, he cannot seek money from his insurer to pay for his damages.

A different situation exists with regards to personal injuries suffered by occupants of the insured vehicle. If you are in an accident that you are responsible for, you cannot make a claim for personal injuries against your own insurance policy. If your son and his friend are in the vehicle with you and you cause an accident, your son‘s friend can obviously make a claim against you under the liability portion of your insurance policy for his personal injuries and damages. However, your son may also make a claim against you, and your insurance company will pay his personal injury claim just as it would his friend‘s because you are responsible for his damages.

With liability claims comes the risk of future insurance premium increases that follow you well into the future. After a number of years, the increase due to the accident (and liability claim against your insurance company) will be removed and your premium decreased as long as you have not had other accidents for which you are responsible. If there are additional accidents in a matter of a few years, an insurer may cancel insurance coverage due to the perception that the insured is at a high risk of future claims.

Insurance coverage issues can be somewhat confusing. Often times, there is no coverage when one might expect it. On other occasions, an experienced personal injury attorney will be able to identify coverage that you did not know was available. And identification of coverage can be half the battle in a personal injury claim.


It is well established in New Mexico that a party injured in an auto accident can make a claim against his or her underinsured motorist policy coverage for both compensatory damages and punitive damages. Typically, to get to underinsured coverage, the injured party must recover liability policy limits from the other driver‘s insurance.

In Farmers v. Sandoval, the New Mexico Court of Appeals addressed this general rule in the case of an injured party with nominal compensatory damage claims and much greater potential punitive damage claims in a DWI related auto accident.

The at fault driver‘s Mid-Century Insurance Company liability policy excluded coverage for its driver for punitive damage awards which would typically be recovered in a DWI auto accident. This exclusion of punitive damages coverage coupled with the injured party‘s small compensatory damage claim prevented recovery for the full liability policy limits under the Mid-Century policy.

The injured party then made an underinsured motorist claim against her own Farmer‘s policy. The injured party sought recovery for the full amount of her underinsured coverage less the actual recovery from Mid-Century. Farmers disputed the claim arguing instead that Farmers was entitled to an offset for the full amount of the Mid-Century liability limits and not lessor recovery due to the punitive damages exclusion. In essence, Farmers was attempting to piggyback the punitive damage exclusion under the Mid-Century policy.

The Court of Appeals disagreed with Farmers on a number of grounds. First, the Court cited the purpose of underinsured coverage which is to protect the New Mexico driving public from uninsured and underinsured drivers. The underlying objective of uninsured/underinsured motorist coverage (UM/UIM) is to make the injured party whole, at least to the degree made possible by the underinsured coverage.

Clearly, injured parties have the right to make a punitive damages claim against their UM/UIM policy. This right should not be constrained by the contractual abrogation of duty on the part of the opposing insurance company. The Court of Appeals recognized that to allow Farmers argument would result in an injured party recovering less in an accident involving an underinsured driver than an accident with a driver that had no insurance at all. The Court stated that this clearly defeated the remedial purpose of UM/UIM coverage.

In short, the Court ruled that that “Farmers‘ offset is limited to the amount of liability proceeds actually received by Defendants under the Mid-Century policy” and not the full amount of the Mid-Century liability limits. This once again reaffirms New Mexico‘s commitment to protecting the public against uninsured and underinsured drivers as evidenced by a steady stream of appellate court cases over the last couple of years aggressively enforcing UM/UIM recovery rights.


The affects of Jordan v. Allstate, Romero v. Progressive and Progressive v. Weed Warrior are already being seen in previously settled uninsured and underinsured auto accident claims in New Mexico.

In short, as addressed previously, acceptance by an insured of uninsured and underinsured coverage below liability policy limits constitutes a rejection of coverage. It is well established in New Mexico that a rejection of uninsured and underinsured coverage must be in writing,and attached to the policy.

As addressed in several prior posts, uninsured and underinsured motorists coverage is extremely important for motorists. This particularly the case in New Mexico which has the highest rate of uninsured motorists in the country with countless more carrying $25,000 minimum liability coverage.

As a result, a driver in an auto accident in New Mexico will in all likelihood be dealing with a negligent driver who has either no insurance or very little insurance. The injuries suffered in car accidents often require medical expenses greatly in excess of the $25,000 minimum liability limits required by law. As such, the $25,000 minimums will often not even cover medical expenses much less other damages such as lost wages which are almost universally present in serious automobile accidents.

The cases of Jordan, Romero and Weed Warriors have corrected a fairly common problem. Drivers often accepted uninsured and underinsured limits below the liability limits. Some did so knowingly with the sole purpose of saving a few dollars a month on premiums. Many others were convinced to reject UM/UIM coverage. In fact, uninsured and uninsured coverage is perhaps the most economical and essential coverage provided for drivers.

As a result, there were and will continue to be those companies that will try to convince drivers that uninsured and underinsured coverage is not necessary and a waste of money. These cases will not stop this practice going forward. But they do address past problems. And they do acceptance of uninsured and underinsured covers be in writing, signed by the insured, and attached to the policies. Hopefully, this will trigger the suspicions of drivers. After all, why would the law require all these hurdles for an insurance company if it were not in the best interests of the driver to have this coverage?

As a result of the cases, some responsible insurance companies are taking a proactive stance actually sending out letters to all drivers that have made uninsured and underinsured claims in the past. The letters alert the drivers of possible rights to additional coverage on their past claims. It is safe to say that many insurance companies will not behave as responsibly.

Not only will some companies not send out these letters, when they do receive a claim, they will fight tooth and nail as they fight all claims on their policies. I will not name those companies here, but a quick review of JD Power‘s annual rating of auto insurance providers will give you a pretty good idea of what to expect from your insurance company.

And to show that I am not totally hostile against all insurance companies, only those that are abusive, dishonest or otherwise fail to honor their responsibilities, I would like to recognize own insurance provider of over 25 years, State Farm, as being both in the top 5 of the JD Power list and among those companies sending out letters to their customers to notify them of their rights.


The New Mexico Supreme Court in Progressive v. Weed Warriors established clearly that acceptance of uninsured/underinsured motorist coverage (UM/UIM) at levels below insurance liability limits constitutes a rejection of coverage. As such, the Court held that a written rejection attached to the policy was required for the rejection of coverage to be binding on the insured driver.

Several auto accident cases involving varying UM/UIM issues were basically on hold awaiting the ruling in Weed Warriors. These cases could not be decided without first having the ruling in Weed Warriors. The New Mexico Supreme Court case of Jordan v. Allstate consolidated these three cases (Jordan v. Allstate, Romero v. Progressive and Lucero v. Trujillo) to address a number of questions left remaining following Weed Warriors.

There were a number of very important issues raised in these cases. As a rejection of coverage per Weed Warriors, the first issue that arises is what form the rejection must take to be valid. Clearly under New Mexico law, a rejection of coverage must be in writing and attached to the policy. Jordan went further to state that the for this requirement to have any meaning insurers must provide premium charges for each level of UM/UIM so that an insured can make an informed decision. Remarkably, this was not the case in the past and insurers had little incentive to quantify the meager savings associated with rejections of UM/UIM coverage.

Though this may seem like little, it is a large stride forward in consumer protection. The insurance companies argued this was a violation of freedom of contract. The Court countered, essentially stating that the essence of freedom of contract is full disclosure. This would of course include pricing.

Perhaps most remarkable in the Jordan case is the fact that the holding was made retroactive. This means that all those rejections of UM/UIM coverage below liability limits back to the date of the statute are invalid in the absence of written waiver, attached to the policy, under full disclosure of UM/UIM costs terms.

It is safe to say that many such rejections were invalid. The insurers argued that this was unfair and would result in unexpected costs to the insurers. The Court responded that the statute requiring written waivers of UM/UIM was clear as to its requirements so that there was no unfairness to the insurance companies. Moreover, the Court stated that the insurance companies should be held to bear the burden of their own misinterpretations of the statute, not the innocent and far less knowledgeable and legally sophisticated insured.