Pritza v. The Village of Lansing
405 Ill.App.3d 634, 940 N.E.2d 1164, 346 Ill. Dec. 560 (1st dist. 5th div. 2010)Words & Phrases
Self Insurance: Uninsured Motorist CoverageTrial Judge
Martin S. AgranAppellate Judge
Toomin. Fitzgerald Smith and Howse concur.Holding
Government self-insurance pools are not “insurance” and thus need not provide underinsured motorist coverage.Fact Summary
Nikola Pritza sought to reform an insurance policy issued to Lansing, IL, by the Illinois Municipal Risk League Management Association (IMRLMA). Pritza asked for a declaratory judgment reforming the policy to include underinsured motorist coverage. The trial court granted summary judgment to Lansing and the IMRLMA. The court found that the IMRLMA is not “insurance” and that Lansing is self-insured and thus is not subject to sections 143a-2 or 155 of the Illinois Insurance Code (215 ILCS 143a-2, 5/155 (West 2000)).
The appellate court affirmed the trial court’s decision. First, the court held that Lansing is exempt from the insurance requirements of the Illinois Vehicle Code because municipalities are not required to carry liability insurance. The Illinois Vehicle Code states that if the owner or operator of a vehicle is a municipality, no insurance policy is necessary. 625 ILCS 5/7-202(7) (West 2000).
Second, the court held that government self-insurance policies are not “insurance,” citing Antiporek v. Village of Hillside, 114 Ill. 2d 246, 249-50 (Ill. 1986). The court further held that, because an insurance policy requires an insurer and an insured, a self-insurance policy is not a “policy” because it has neither. Because Lansing is a self-insurer and Section 143a-2 of the Illinois Insurance Code doesn’t apply to self-insurance, under precedent it is not obligated to provide underinsured motorist coverage. Section 143 only requires underinsured motorist coverage where liability insurance policies are purchased to satisfy financial responsibility.
The court acknowledged that there is no precedent specifically saying that self-insuring municipalities are not insurers in the context of the Illinois Insurance Code or the Illinois Vehicle Code. But, the court said, there is no reason that the Illinois Supreme Court’s ruling in Antiporek that they are not insurers should not apply in this context. So, in addition to being exempt from section 143a-2 as a municipality, they also are not insurers and owe no duty to the plaintiff to provide underinsured motorist coverage. Summary Judgment on this issue was proper. Summary Judgment was also proper for the plaintiff’s Insurance Code section 155 claim (215 ILCS 5/155 (West 2008)). That section only applies when an insurance policy is at issue. There is no liability under section 155 for a defendant who is not an insurer.