Failure to Identify Relative as a Resident of Household Limits Available UM Coverage

Uninsured Motorist Coverage Limited to Minimum Statutory Limits

Tiffany Chow appealed the district court judgment in favor of IDS Property Casualty Insurance Company in this insurance coverage dispute. In IDS Property Casualty Insurance Company v. Tiffany Chow, No. 19-55837, United States Court Of Appeals For The Ninth Circuit (July 14, 2020) Chow claimed she was entitled to full policy limits even though policy excluded her. The trial court allowed her to receive the statutory limit of $30,000 but refused to allow her to receive the stated UM limit of $250,000.


The automobile insurance policy provided $250,000 per person in underinsured motorist bodily injury coverage to a named insured or a “relative” of a named insured. The policy defined a “relative” as “a person related to you by blood, marriage, registered domestic partnership under California law or adoption who is a resident of your household and whom you have previously identified to us.” The district court concluded that Chow was ineligible for coverage because she had not been “previously identified” to IDS as a resident relative. In fact, the named insureds had informed IDS that Chow was not a resident of their household.

The district court further concluded that Chow was covered by the implied-by-law terms of the policy. In the absence of a written waiver, California law requires an automobile insurance policy to provide underinsured motorist bodily injury coverage of at least $30,000 per person to any relatives of a named insured “while residents of the same household.” The district court held that Chow, as a resident relative, was covered for $30,000 as provided by California law. Chow appeals, arguing that her coverage was $250,000 rather than $30,000.

Chow claimed the “previously identified” requirement is unenforceable, and when that requirement is read out of the policy, she meets the policy’s definition of “relative.”


Under California law, policy exclusions are not enforceable to the extent they conflict with California law. Thus, the policy’s “previously identified” requirement is unenforceable, but only to the extent it denies all coverage to unidentified resident relatives. It is, however, enforceable to the extent it denies coverage above the $30,000 statutory minimum.

Unless the insurer and the named insured execute a written waiver an insurance policy governed by its terms will be held to provide uninsured motorist coverage in the amounts mandated in the statute. Every insurance policy must be read so as to provide the minimum coverage required by law under a policy of that type, even where the policy on its face fails to do so.

The purpose of the uninsured motorist statute is not to make all drivers whole from accidents with uninsured drivers, but to make sure that drivers injured by such drivers are protected to the extent that they would have been protected had the driver at fault carried the statutory minimum of liability insurance.

The Ninth Circuit rejected Chow’s contention that the district court improperly concluded that the “previously identified” requirement was not plain, clear, and conspicuous. Further, although the policy did not clearly or conspicuously state that Chow was eligible by law for $30,000 in underinsured motorist coverage, Chow points to no authority requiring a policy to clearly and conspicuously set forth policy terms enhancing—rather than reducing—insurance coverage.

The policy unambiguously required the named insured to identify Chow as both a relative and a resident of the household. Chow was not so identified. As a result she was not entitled to the full amount of the stated coverage but by law she was entitled to the statutory minimum.


The Ninth Circuit read the entire policy and found its exclusion of coverage for a resident relative not previously identified to the insurer before a loss, to be clear, and unambiguous. Since the exclusion itself was conspicuous and known to the named insured who advised IDB that Chow was not a resident relative she was not entitled to the full limits but got the statutory minimum.  Facts can often be difficult things and those difficult things – and a statute – allowed Chow to receive up to $30,000 of UM coverage that IDB did not intend to pay but did not get the $250,000 she wanted.

© 2020 – Barry Zalma

Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant  specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He also serves as an arbitrator or mediator for insurance related disputes. He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 52 years in the insurance business. He is available at and

Mr. Zalma is the first recipient of the first annual Claims Magazine/ACE Legend Award.

Over the last 52 years Barry Zalma has dedicated his life to insurance, insurance claims and the need to defeat insurance fraud. He has created the following library of books and other materials to make it possible for insurers and their claims staff to become insurance claims professionals.

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