State Farm not required to pay uninsured motorist benefits where suit not filed within one year
Kimberly Idalski was seriously injured in a motor vehicle collision. She had bought Uninsured Motorist [UM] benefits from State Farm, and the at-fault driver turned out to be uninsured. In theory, this would allow Idalski to recover from her insurer, State Farm, for any damages the uninsured motorist should have paid. Although Idalski sued within the three-year statute of limitations provided by law, she did not provide a formal notice to State Farm or file suit within the shorter period State Farm imposed in the contract. Her attorneys argued that State Farm had suffered no prejudice by Idalski's failure to comply with the shorter notice and suit period, but the Court of Appeals held that State Farm need not show prejudice: it was allowed to enforce the shorter limitation period without regard to any claim of harm or prejudice. Most insurance companies do not impose a contractual limitation period that is shorter than the period provided by law: the so-called "Engler Majority" allowed insurers to impose a shorter limitation, however, during a period of insurer-favored activism that lasted most of the past decade.