Shelter Mut. Ins. Co. v. Freudenburg

Nebraska Supreme Court Online Library
www.nebraska.gov/apps-courts-epub/
05/01/2020 08:08 AM CDT
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Nebraska Supreme Court Advance Sheets
304 Nebraska Reports
SHELTER MUT. INS. CO. v. FREUDENBURG
Cite as 304 Neb. 1015
Shelter Mutual Insurance Company,
appellee, v. Larry Freudenburg,
appellant.
___ N.W.2d ___
Filed February 7, 2020. No. S-19-265.
1. Summary Judgment: Appeal and Error. An appellate court affirms a
lower court’s grant of summary judgment if the pleadings and admitted
evidence show that there is no genuine issue as to any material facts or
as to the ultimate inferences that may be drawn from the facts and that
the moving party is entitled to judgment as a matter of law.
2. ____: ____. In reviewing a summary judgment, an appellate court views
the evidence in the light most favorable to the party against whom the
judgment was granted, and gives that party the benefit of all reasonable
inferences deducible from the evidence.
3. Statutes: Appeal and Error. To the extent an appeal calls for statutory
interpretation or presents questions of law, an appellate court must reach
an independent conclusion irrespective of the determination made by the
court below.
4. ____: ____. An appellate court will not resort to interpretation to
ascertain the meaning of statutory words that are plain, direct, and
unambiguous.
5. Statutes: Legislature: Intent. A collection of statutes pertaining to a
single subject matter are in pari materia and should be conjunctively
considered and construed to determine the intent of the Legislature, so
that different provisions are consistent, harmonious, and sensible.
6. Statutes. It is impermissible to follow a literal reading that engenders
absurd consequences where there is an alternative interpretation that
reasonably effects a statute’s purpose.
7. ____. A court must attempt to give effect to all parts of a statute, and if
it can be avoided, no word, clause, or sentence will be rejected as super-
fluous or meaningless.
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SHELTER MUT. INS. CO. v. FREUDENBURG
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Appeal from the District Court for Lancaster County:
Jodi L. Nelson, Judge. Reversed and remanded for further
proceedings.
George H. Moyer and Jack W. Lafleur, of Moyer & Moyer,
for appellant.
Theresa D. Koller and Nathan D. Clark, of Cline, Williams,
Wright, Johnson & Oldfather, L.L.P., for appellee.
Heavican, C.J., Miller-Lerman, Cassel, Stacy, Funke,
and Freudenberg, JJ.
Freudenberg, J.
NATURE OF CASE
The primary issue in this case is whether Neb. Rev. Stat.
§ 60-310 (Cum. Supp. 2018) allows provisions known as
partial household exclusion clauses, which reduce automobile
liability coverage from the policy amount to the state minimum
when the injured person is an insured, relative, or resident
of the insured’s household. The district court found that the
statute unambiguously defined an automobile policy as cov-
erage in the amounts set by the state minimums and that the
second sentence of the statute prevented complete household
exclusions, but did not prohibit partial exclusions. The district
court granted summary judgment in favor of Shelter Mutual
Insurance Company (Shelter) upholding the partial household
exclusion clause, which reduced the insured’s coverage from
the policy amount of $100,000 to $25,000.
BACKGROUND
The insured, Larry Freudenburg, appeals from an order
granting summary judgment in favor of Shelter in its action for
declaratory judgment regarding the application of § 60-310 to the
underlying automobile liability policy and against Freudenburg
on his counterclaim for breach of contract. Freudenburg did not
file a cross-motion for summary judgment. Shelter originally
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SHELTER MUT. INS. CO. v. FREUDENBURG
Cite as 304 Neb. 1015
brought the action against both Freudenburg and Bruce R.
Ramage, the director of the Nebraska Department of Insurance,
in his official capacity. Ramage was later dismissed from the
case and is not part of this appeal.
The facts are undisputed. On October 20, 2016, Freudenburg
was traveling as a passenger in a car covered by a pol-
icy Freudenburg and his wife had purchased from Shelter.
Freudenburg made a claim for his injuries under the Shelter
policy because the injuries were not covered by any other
policies. After the accident, Freudenburg filed a claim for
reimbursement of expenses based on his injuries totaling over
$100,000. Rather than paying the policy limit for bodily injury
in the amount of $100,000, Shelter paid $25,000, which is the
minimum level of automobile liability coverage that drivers in
Nebraska are required by law to carry.
Shelter refused to pay Freudenburg’s request for an addi-
tional $75,000 based on a partial household exclusion clause in
Freudenburg’s policy. A section titled “Partial Exclusions From
Coverage A and Coverage B” begins with the following:
Coverage A [for bodily injury] and Coverage B [for
property damage] do not cover any of the types of dam-
ages listed below unless no other policy of liability insur-
ance provides coverage for those damages in the amount
required by the applicable financial responsibility law.
In that event, the minimum dollar amount of coverage
required by the applicable financial responsibility law
will be provided by this policy. No additional benefits
that are not required by that law will be provided.
Subsection 13 of this provision allows for a reduction in bodily
injury coverage for “[d]amages owed to any insured, rela-
tive, or resident of an insured’s household.” Shelter asserted
that the $100,000 policy for bodily injury was reduced to the
Nebraska minimum of $25,000 pursuant to the partial house-
hold exclusion clause.
Shelter received a letter from Ramage on behalf of the
Nebraska Department of Insurance which asked Shelter why it
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SHELTER MUT. INS. CO. v. FREUDENBURG
Cite as 304 Neb. 1015
had not paid the full $100,000 of the policy. Shelter’s response
cited the partial household exclusion clause and asserted that
such an exclusion was not prohibited by Nebraska law, spe-
cifically that it did not fall under the prohibition found in
§ 60-310. The Nebraska Department of Insurance sent a letter
indicating it disagreed with Shelter’s interpretation of § 60-310,
which provides:
Automobile liability policy means liability insurance
written by an insurance carrier duly authorized to do busi-
ness in this state protecting other persons from damages
for liability on account of accidents occurring subsequent
to the effective date of the insurance arising out of the
ownership of a motor vehicle (1) in the amount of twenty-
five thousand dollars because of bodily injury to or death
of one person in any one accident, (2) subject to the limit
for one person, in the amount of fifty thousand dollars
because of bodily injury to or death of two or more per-
sons in any one accident, and (3) in the amount of twenty-
five thousand dollars because of injury to or destruction
of property of other persons in any one accident. An auto-
mobile liability policy shall not exclude, limit, reduce, or
otherwise alter liability coverage under the policy solely
because the injured person making a claim is the named
insured in the policy or residing in the household with the
named insured.
In June 2017, Shelter brought a declaratory action seeking to
declare that partial household exclusions are permissible under
Nebraska law. The district court determined that § 60-310
unambiguously forbade only reductions or alterations in cov-
erage that result in the coverage for the insured, relative, or
household member’s falling below the mandatory minimums
described in the first sentence of the statute. The court declined
to consider the legislative history concerning the 2013 change
to § 60-310, which added the language “limit, reduce, or oth-
erwise alter” to the prior version of the statute and explicitly
discussed the Legislature’s intent to thereby prohibit partial
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SHELTER MUT. INS. CO. v. FREUDENBURG
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household exclusions. The court concluded that partial house-
hold exclusions are not prohibited by § 60-310. The court
granted summary judgment to Shelter. Freudenburg appeals.
ASSIGNMENTS OF ERROR
Freudenburg assigns that summary judgment was improper
because the trial court erred in (1) interpreting the last sentence
of § 60-310 to allow for reductions in coverage down to the
state minimum; (2) refusing to consider the legislative history
of 2013 Neb. Laws, L.B. 316; and (3) enforcing the partial
household exclusion contained in the policy Freudenburg pur-
chased from Shelter.
STANDARD OF REVIEW
[1] An appellate court affirms a lower court’s grant of sum-
mary judgment if the pleadings and admitted evidence show
that there is no genuine issue as to any material facts or as
to the ultimate inferences that may be drawn from the facts
and that the moving party is entitled to judgment as a matter
of law.1
[2] In reviewing a summary judgment, an appellate court
views the evidence in the light most favorable to the party
against whom the judgment was granted, and gives that party
the benefit of all reasonable inferences deducible from the
evidence.2
[3] To the extent an appeal calls for statutory interpretation
or presents questions of law, an appellate court must reach an
independent conclusion irrespective of the determination made
by the court below.3
ANALYSIS
Although Freudenburg has assigned several errors on appeal,
the errors are rooted in a single question of how to interpret
1
Williamson v. Bellevue Med. Ctr., ante p. 312, 934 N.W.2d 186 (2019).
2
Id.
3
In re Adoption of Micah H., 301 Neb. 437, 918 N.W.2d 834 (2018).
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SHELTER MUT. INS. CO. v. FREUDENBURG
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§ 60-310. Shelter believes the only question in this regard is
how to understand § 60-310’s term “automobile liability pol-
icy” in the context of the statute’s prohibition that “[a]n auto-
mobile liability policy shall not exclude, limit, reduce, or oth-
erwise alter liability coverage under the policy solely because
the injured person making a claim is the named insured in the
policy or residing in the household with the named insured”
(hereinafter the household exclusion prohibition). We also
find the statute’s term “liability coverage” to be essential to
our analysis.
[4-7] An appellate court will not resort to interpretation
to ascertain the meaning of statutory words that are plain,
direct, and unambiguous.4 A collection of statutes pertaining
to a single subject matter are in pari materia and should be
conjunctively considered and construed to determine the intent
of the Legislature, so that different provisions are consistent,
harmonious, and sensible.5 It is impermissible to follow a lit-
eral reading that engenders absurd consequences where there is
an alternative interpretation that reasonably effects a statute’s
purpose.6 A court must attempt to give effect to all parts of a
statute, and if it can be avoided, no word, clause, or sentence
will be rejected as superfluous or meaningless.7
The Motor Vehicle Registration Act 8 generally provides the
rules and regulations for acquiring and maintaining registration
of vehicles that are operating on Nebraska roadways. The first
sentence of § 60-310 expressly defines “automobile liability
policy” to be coverage in certain amounts based on state mini-
mums for each category, stating:
Automobile liability policy means liability insurance
written by an insurance carrier duly authorized to do
4
State v. Montoya, ante p. 96, 933 N.W.2d 558 (2019).
5
State v. Paulsen, ante p. 21, 932 N.W.2d 849 (2019).
6
State v. McColery, 301 Neb. 516, 919 N.W.2d 153 (2018).
7
Id.
8
See Neb. Rev. Stat. §§ 60-301 to 60-3,231 (Reissue 2010 & Cum. Supp.
2016).
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SHELTER MUT. INS. CO. v. FREUDENBURG
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business in this state protecting other persons from dam-
ages for liability on account of accidents occurring sub-
sequent to the effective date of the insurance arising out
of the ownership of a motor vehicle (1) in the amount
of twenty-five thousand dollars because of bodily injury
to or death of one person in any one accident, (2) sub-
ject to the limit for one person, in the amount of fifty
thousand dollars because of bodily injury to or death of
two or more persons in any one accident, and (3) in the
amount of twenty-five thousand dollars because of injury
to or destruction of property of other persons in any
one accident.
The coverage so described is commonly referred to as “25/50/25
coverage.” Other statutes of the Motor Vehicle Registration Act
then set forth that a driver must show proof of financial respon-
sibility9 or a current “automobile liability policy”10 in order to
register a vehicle and must have a current “automobile liability
policy”11 anytime the vehicle is operated in Nebraska.
The second, and last, sentence of § 60-310 addresses the
legality of policy provisions that seek to exclude or alter cov-
erage based on the injured claimant in the accident’s being the
named insured or a member of the named insured’s house-
hold. This is in contrast to a friend or acquaintance who is
injured as the driver or passenger of the insured’s vehicle,
who would be covered up to the general coverage limits of the
insured’s policy.
The two sentences of § 60-310 both use the term “automo-
bile liability policy,” and we logically must read both sentences
as using the same meaning for that term. Further, under a plain
reading of the second sentence of § 60-310, we understand
“under the policy” as referring to that same “automobile liabil-
ity policy.”
9
See § 60-346.
10
See § 60-387.
11
See § 60-390.
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SHELTER MUT. INS. CO. v. FREUDENBURG
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Shelter observes that the definition of “automobile liability
policy” in the first sentence of § 60-310 has no modifier and
simply describes coverage “in the amount of” 25/50/25 cov-
erage. Shelter proposes that the plain language of § 60-310
thus requires that we read “automobile liability policy” as a
policy providing coverage “only” or “exactly” in the amount
of 25/50/25. Freudenburg, in contrast, asserts that “automobile
liability policy” should be read as a policy providing “at least”
25/50/25 coverage. We agree with Freudenburg.
Shelter’s proposed definition of “automobile liability pol-
icy,” i.e., “25/50/25 . . . liability insurance”12 (nothing more and
nothing less), engenders absurd consequences when applied to
the second sentence of § 60-310, as well as elsewhere under
the act. If, under the second sentence of § 60-310, a policy with
coverage greater than the 25/50/25 minimum is not an “auto-
mobile liability policy,” then the household exclusion prohibi-
tion of the second sentence would not apply to such policies
at all. Under Shelter’s proposed construction, the household
exclusion prohibition of § 60-310 would read as follows:
“[A 25/50/25] automobile liability policy shall not exclude,
limit, reduce, or otherwise alter liability coverage under the
[25/50/25] policy solely because the injured person making a
claim is the named insured in the [25/50/25] policy or resid-
ing in the household with the named insured.” Such a reading
would mean that the household exclusion prohibition of the
second sentence of § 60-310 would not even be applicable to
Freudenburg’s policy under Shelter’s interpretation of “auto-
mobile liability policy,” because his policy was for coverage
referred to as “100/300/100.” Under Shelter’s proposed defini-
tion of “automobile liability policy,” Shelter would have been
free under Nebraska law to completely exclude Freudenburg
from coverage.
Furthermore, such a reading would lead to the absurd result
that the Motor Vehicle Registration Act does not regulate
12
Brief for appellee at 13.
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SHELTER MUT. INS. CO. v. FREUDENBURG
Cite as 304 Neb. 1015
all automobile insurance purchased by Nebraska residents,
but only insurance for coverage in the minimum amount of
25/50/25.13 This appears contrary to the overall intent of the
statutory scheme, as usage of the term “automobile liability
policy” elsewhere seems to include policies with coverage
in excess of the 25/50/25 minimums set forth in § 60-310.14
For example, reading the definition of “automobile liability
policy” to include policies that exceed the state minimums is
in harmony with the language of § 60-390, which provides
in part:
On the back of the certificate, the certificate of registra-
tion shall include a statement in boldface print that an
automobile liability policy or proof of financial respon-
sibility is required in Nebraska. By paying the required
registration fees, every person whose name appears on
the registration of the motor vehicle or trailer certifies
that a current and effective automobile liability policy or
proof of financial responsibility will be maintained for
the motor vehicle or trailer at the time of registration and
while the motor vehicle or trailer is operated on a high-
way of this state and that he or she will also provide a
current and effective automobile liability policy, evidence
of insurance, or proof of financial responsibility for the
motor vehicle or trailer upon demand.
Under Shelter’s interpretation of “automobile liability policy,”
anyone carrying proof of a policy in amounts that are not
exactly 25/50/25 is not carrying proof of an effective automo-
bile liability policy.
Thus, “automobile liability policy” must mean a policy with
coverage in at least the 25/50/25 amount and not a policy with
overall limits of “only” or “exactly” the minimum 25/50/25
coverage amount. Understanding “automobile liability policy”
to mean coverage in the amount of at least 25/50/25 is in
13
See §§ 60-301 to 60-3,231.
14
See §§ 60-323, 60-387, 60-390, 60-3,167, and 60-3,168.
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harmony with the term’s usage throughout the Motor Vehicle
Registration Act.15 Moreover, this understanding avoids two
absurd results: First, it avoids a situation where the Motor
Vehicle Registration Act only regulates policies with cover-
age limits of 25/50/25. Second, it avoids the situation where a
policy that includes coverage limits above 25/50/25 does not
qualify as proof of an automobile liability policy elsewhere in
the act.16
Perhaps realizing that it would be nonsensical to read the
household exclusion prohibition as applying to only 25/50/25
policies, Shelter does not acknowledge the logical conse-
quences of its plain language argument that “automobile lia-
bility policy” means a policy providing “only” or “exactly”
25/50/25 coverage. Shelter instead asserts that a consistent
application of its understanding of “automobile liability policy”
results merely in prohibiting exclusions for a claimant insured
or household member, in policies with underlying maximum
coverage in any amount, which result in lowering coverage
for such claimants below the 25/50/25 minimum required of
drivers under Nebraska law. By conceding the applicability
of the household exclusion prohibition to policies providing
coverage above the 25/50/25 minimum, such a proposed read-
ing of the statute actually utilizes Freudenburg’s understanding
of “automobile liability policy” as a policy providing coverage
in at least the 25/50/25 amount, not Shelter’s understanding of
“automobile liability policy” as a policy with coverage in only
the 25/50/25 amount.
What Shelter’s argument really is about is the term “liability
coverage.” In essence, Shelter’s reading proposes the inser-
tion of the modifier “the minimum 25/50/25” into the phrase
“liability coverage” in the last sentence of § 60-310. In other
words, Shelter wants to make the term “liability coverage” syn-
onymous with the definition of “automobile liability policy.”
15
See State v. Paulsen, supra note 5.
16
See § 60-387.
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The Motor Vehicle Registration Act does not define “liabil-
ity coverage.” But while not controlling, the term “liability
coverage” is used elsewhere in the statutes governing insurance
to refer collectively to the various categories of insurance that
cover liability arising out of automobile accidents.17 We give
the term the same plain meaning in § 60-310.
As such, the term “liability coverage” refers more broadly
to the various types of liability coverage afforded in an auto-
mobile liability policy. From its plain meaning, it follows that
where, as we have already determined, “automobile liabil-
ity policy” includes all policies with coverage of at least
25/50/25, the second sentence of § 60-310 clearly prohibits any
“exclu[sions], limit[ations], reduc[tions], or . . . alter[ations]”
to the policy’s liability coverage “solely because the injured
person making a claim is the named insured in the policy or
residing in the household with the named insured.”
We hold that § 60-310 applies to policies both with cover-
age limits at the minimum required by law and with coverage
limits above the minimum required by law and that it prohib-
its both exclusions that seek to completely exclude liability
coverage for an injured insured or household member and
exclusions that seek to limit, reduce, or alter the liability cov-
erage to the minimum required by law for an injured insured
or household member. Simply put, an automobile liability
policy in any coverage amount is not permitted to exclude or
reduce liability coverage under the policy solely on the ground
the claimant is a named insured or resident in the named
insured’s household.
Because the plain language of § 60-310, viewed with the
other sections of the Motor Vehicle Registration Act, permits
only one reasonable interpretation, we do not consider the
legislative history. However, for the sake of completeness,
we note that in 2013, the Legislature amended the household
exclusion prohibition to its current form. The bill proposing
17
See, e.g., Neb. Rev. Stat. §§ 44-514 and 60-1407.01(3) (Reissue 2010).
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the 2013 amendment was introduced with the specific intent
to render invalid both partial household exclusions and total
household exclusions. The record of the committee hearings
for 2013 Neb. Laws, L.B. 316, demonstrates the bill’s spon-
sor and the committee understood that the language originally
added in 1995 resulted in preventing only total household
exclusions, which was not what the Legislature had wished
to achieve.
The intent of the 2013 amendment was to prohibit all house-
hold exclusions, both total and partial.18 The bill’s sponsor,
Senator Burke Harr, explained it this way:
For example, a person might have a policy providing
$500,000 in coverage, which we discussed earlier, but the
insurer includes a provision that says if the insured person
. . . the injured person . . . is related to or residing with the
named insured, the coverage is only $25,000. This thwarts
the intent of the Legislature. I believe (LB)316 maintains
the intent of the Legislature in repealing the guest statute
and prohibiting household exclusions.19
Harr provided the same explanation to the entire Legislature
during the floor debates.20 The Legislature passed the law on a
vote of 44 to 0.21
CONCLUSION
We conclude that the district court erred in granting sum-
mary judgment to Shelter on its declaratory judgment action,
and therefore, we must reverse that decision and remand this
matter for further proceedings consistent with this opinion.
For the foregoing reasons, the judgment of the district court
18
See Introducer’s Statement of Intent, L.B. 316, Committee on Banking,
Commerce and Insurance, 103d Leg., 1st Sess. (Feb. 11, 2013).
19
Committee on Banking, Commerce and Insurance Hearing, L.B. 316, 103d
Leg., 1st Sess. (Feb. 11, 2013).
20
Floor Debate, L.B. 316, 103d Leg., 1st Sess. (Mar. 01, 2013).
21
Floor Debate, L.B. 316, 103d Leg., 1st Sess. (Mar. 28, 2013).
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is reversed and the cause is remanded for further proceedings
consistent with this opinion.
Reversed and remanded for
further proceedings.
Papik, J., not participating.
Stacy, J., concurring.
I agree with the majority’s resolution of this case, which
presents a very narrow question of statutory construction. We
are asked to determine whether a 2013 amendment to Neb.
Rev. Stat. § 60‑310 (Reissue 2010) should be understood to
prohibit, or instead to authorize, a clause in an automobile
liability policy that reduces liability coverage down to the
statutory minimum when the claimant is a named insured or
resides in the named insured’s household. The parties refer to
such a provision as a “partial household exclusion.” I write
separately to provide a brief overview of the historical treat-
ment of household exclusions under Nebraska law.
In a series of opinions beginning with Allstate Ins. Co. v.
Farmers Mut. Ins. Co.,1 decided in 1989, this court held that
household exclusions in automobile liability insurance policies
were valid and enforceable under Nebraska law and not con-
trary to public policy.2 In these cases, we reasoned generally
that household exclusions, when contained in an automobile
liability policy not being used as proof of future financial
responsibility, did not violate public policy because the statutes
prescribing the general requirements for automobile liability
1
Allstate Ins. Co. v. Farmers Mut. Ins. Co., 233 Neb. 248, 444 N.W.2d 676
(1989).
2
See id. (holding household exclusion in automobile liability policy is
not invalid as against public policy); State Farm Mut. Auto. Ins. Co. v.
Hildebrand, 243 Neb. 743, 502 N.W.2d 469 (1993) (holding household
exclusion in automobile liability policy not used as proof of financial
responsibility under Motor Vehicle Safety Responsibility Act does not
violate public policy and is enforceable); and Allied Mut. Ins. Co. v. State
Farm Mut. Auto. Ins. Co., 243 Neb. 779, 502 N.W.2d 484 (1993) (same).
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policies in Nebraska did not contain language prohibiting such
exclusions.3
In 1995, the Legislature changed that by adding the follow-
ing language to Neb. Rev. Stat. § 60‑301(3) (Supp. 1995): “An
automobile liability policy shall not exclude liability coverage
under the policy solely because the injured person making a
claim is the named insured in the policy or a spouse or relative
residing in the same household with the named insured.”4 The
practical effect of this new statutory language was to estab-
lish, as a matter of public policy in Nebraska, that household
exclusions were no longer valid and enforceable in automobile
liability policies.
In 2005, the Legislature recodified the Motor Vehicle
Registration Act and, as relevant here, repealed § 60‑301 and
enacted § 60‑310.5 After the 2005 amendments, § 60‑310 pro-
hibited provisions in automobile liability policies that “exclude
liability coverage under the policy solely because the injured
person making a claim is the named insured in the policy or
residing in the household with the named insured.”6 Thereafter,
in 2013, the Legislature amended that portion of the statute
which prohibits household exclusions, so that § 60‑310 (Cum.
Supp. 2018) currently provides: “An automobile liability pol-
icy shall not exclude, limit, reduce, or otherwise alter liability
coverage under the policy solely because the injured person
making a claim is the named insured in the policy or residing
in the household with the named insured.”
Shelter argues that its partial household exclusion does
not run afoul of the current language in § 60‑310 because it
neither completely excludes liability coverage nor reduces
liability coverage below the statutory minimum required under
Nebraska law.
3
See id.
4
See 1995 Neb. Laws, L.B. 37.
5
2005 Neb. Laws, L.B. 274.
6
See id.
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In that regard, it is worth noting that some other courts
have construed their statutory scheme to allow partial or lim-
ited household exclusions in automobile liability policies, so
long as liability coverage is afforded up to the minimum
limits required by the state’s financial responsibility stat-
ute.7 However, I agree with the majority’s conclusion that the
plain language in § 60‑310 simply is not amenable to such a
construction.
Section 60‑310 uses language that is plain and unambigu-
ous to prohibit automobile liability policies from excluding,
limiting, reducing, or otherwise altering liability coverage
solely because the claimant is the named insured or residing
in the named insured’s household. This statutory language,
both on its face and in light of its historical evolution, leaves
no room for a successful argument that by amending § 60‑310
in 2013, the Legislature intended to actually allow house-
hold exclusions in automobile liability policies so long as
they did not reduce liability coverage below the minimum
required limits.
It is the function of the Legislature through the enactment
of statutes to declare what is the law and public policy of
this state.8 While there may be sound public policy reasons to
limit insurance coverage based on whether one resides in the
7
See, e.g., Shook v. State Farm Mut. Ins. of Bloomington, Ill., 872 F.
Supp. 768 (D. Mont. 1994) (household exclusion that limited coverage to
statutory minimums did not violate public policy inherent in Montana’s
mandatory insurance law); Stearman v. State Farm, 381 Md. 436, 849 A.2d
539 (2004) (household exclusion reducing limit of liability coverage to
statutory minimum amount valid when policy otherwise provided liability
coverage in excess of statutory minimum liability limits); Hoque v. Empire
Fire and Marine Ins. Co., 281 Ga. App. 810, 637 S.E.2d 465 (2006) (when
policy provides liability coverage above statutorily minimum, household
exclusion does not violate public policy so long as recovery is permitted
in amount of compulsory minimum insurance).
8
Alsidez v. American Family Mut. Ins. Co., 282 Neb. 890, 807 N.W.2d 184
(2011).
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Nebraska Supreme Court Advance Sheets
304 Nebraska Reports
SHELTER MUT. INS. CO. v. FREUDENBURG
Cite as 304 Neb. 1015
named insured’s household,9 that is a decision properly left to
the Legislature, not the courts. Because I agree with the major-
ity that the language of § 60‑310 is plain and unambiguous in
prohibiting provisions in an automobile liability policy that
exclude, limit, reduce, or alter liability coverage solely because
the claimant is the named insured or resides in the named
insured’s household, I concur in the result reached here.
9
See, e.g., id. (holding exclusions in uninsured and underinsured motorist
coverage for vehicles owned or regularly used by named insured or any
resident of their household do not violate public policy as expressed by
Legislature because exclusions mirror statutory provisions). See, also,
Neb. Rev. Stat. § 44‑6407(2) (Reissue 2010) (defining uninsured or
underinsured motor vehicle to exclude vehicles “[o]wned by, furnished, or
available for the regular use of the named insured or any resident of the
insured’s household”).