James v. Michigan Mutual Insurance

The sole issue raised by the instant case is whether the appellant, Michigan Mutual, is entitled to deduct, directly from the limits of its underinsured motorist coverage, the $12,500 paid to appellee Billy James by Globe American on behalf of Smith (an underinsured motorist). The appellant argues that it is entitled to such a deduction (or “setoff”) pursuant to R.C. 3937.181(C) and the terms of the appellee’s contract of insurance.

At the time of the appellee’s accident with Smith, R.C. 3937.181(C) provided: “The benefits provided under underinsured motorist coverages shall be subject to the…