Third Circuit Interprets ‘Arising Out Of’ Clause for UM Benefits Broadly
Claims Journal now features “Burke’s Law,” a monthly column that analyzes recent state and federal court decisions affecting the insurance industry. The column is authored by Burke Coleman, Demotech, Inc.’s Legal Counsel and Compliance Manager.
Mr. Coleman’s most recent article, Third Circuit Interprets ‘Arising Out Of’ Clause for UM Benefits Broadly, reviewed the significance of the recent decision in Allstate Property and Casualty Ins. Co. v. Squires, 667 F.3d 388 (3rd Cir. 2012). The decision represents one of the broadest readings of the “arising out of” clause which defines the necessary causal link for the application of uninsured motorist benefits. The court determined that an accident caused by a box lying in the middle of the road arose out of the use of an uninsured auto. In coming to its decision, the Third Circuit found that the “arising out of” clause does not require the instrumentality causing the accident to be the uninsured vehicle but rather the policy language simply requires an uninterrupted causal relation that stems from the common use of a vehicle.