Sidney W. White v. State Farm Mutual Automobile Insurance Company

Syllabus

Appellants were injured in a car accident and, with the permission of their insurance company, Appellee State Farm Mutual Automobile Insurance Company (\State Farm\), settled with the at-fault driver for his policy limits under his coverage with United Services Automobile Association (\USAA\). To fully recover for their injuries, Appellants notified State Farm of their willingness to settle or submit their underinsured motorist (\UIM\) claim to binding arbitration. After evaluating Appellants' claim, State Farm informed Appellants that it would not offer a settlement for the UIM claim because it believed they had been fully compensated by the payment from USAA. Appellants, in response, demanded that State Farm elect to either participate in binding arbitration or decline arbitration and preserve its subrogation rights under Tennessee Code Annotated section 56-7-1206 (\the Statute\). Believing that its obligation under the Statute was never triggered, State Farm refused to make an election. Appellants filed an action for declaratory judgment asking the trial court to declare that State Farm failed to comply with the Statute. On competing motions for summary judgment, the trial court granted State Farm's motion and denied Appellants' motion. Finding no error, we affirm.