Delivery Work, Stacked UM Limits, and Modified Comparative Fault
Maya carries a Tennessee personal auto policy on two vehicles: liability 100/300/50, UM/UIM 100/300, medical payments $5,000, and a $500 collision deductible. Her son Eli, 22, is a listed driver; his car is garaged with him at college 200 miles away, and both vehicles carry separately rated UM premiums. On a Friday night Eli is logged into a food-delivery app and is carrying an order when an uninsured driver runs a red light. Eli's medical bills and lost wages total $160,000; his passenger's total $30,000. Neither the other driver nor the passenger has other coverage. The policy contains the standard exclusion for a vehicle "used to carry persons or property for a fee," and Maya bought no delivery or rideshare endorsement.
1. Does the policy respond to Eli's injuries? Walk through the analysis.
Read the worked answer
Start with the grant of coverage, then the exclusion, because the exclusion is where this claim lives.
- Eli is an insured: a family member using a covered auto with permission, so Parts A, B, C and D extend to him on the face of the policy.
- The "carrying persons or property for a fee" exclusion is the obstacle. Delivering food for pay is precisely the use that exclusion targets, and it commonly appears in the liability, medical payments and uninsured motorist parts alike. If it applies, there is no med pay, no UM, and no defense if the passenger sues Eli.
- Arguments the adjuster must still evaluate: whether the form defines the excluded use narrowly (public or livery conveyance) and Eli's activity was occasional; whether coverage exists for the interval before he logged on and accepted the order; and whether the insurer's underwriting file already reflected the delivery work.
The insured's real remedy is a commercial auto policy or a delivery/rideshare endorsement, not a coverage argument after the crash.
2. Assume the exclusion does not apply. How much UM is available, and does the second vehicle's UM coverage stack?
Read the worked answer
UM pays the gap between the tortfeasor's collectible coverage and the insured's damages, capped by the UM limits. The tortfeasor is uninsured, so the gap is the whole loss.
- Unstacked (one vehicle's limits): per person $100,000, per accident $300,000. Eli's $160,000 exceeds the per-person cap, so $100,000; passenger $30,000. Total $130,000, within the per-accident cap.
- Stacked (two vehicles): $200,000 per person and $600,000 per accident. Eli recovers his full $160,000 and the passenger $30,000, total $190,000.
Stacking is decided by policy language and premium practice. Tennessee has generally permitted intra-policy stacking of UM limits where the insured paid separate UM premiums for each vehicle, unless the policy contains clear and valid anti-stacking language. Here the separately rated UM premiums on both vehicles are exactly the fact that supports stacking - but read the endorsement's limit-of-liability paragraph before committing.
Also check the Part B offset: if $5,000 of med pay has been paid, the UM endorsement likely reduces the UM payment by that amount. UM does not pay the same dollar twice.
3. A jury would assign Eli 20% of the fault. How do the numbers change, and what is the passenger's position?
Read the worked answer
Tennessee uses modified comparative fault: the claimant's recovery is reduced by his percentage of fault, and he is barred entirely only if his fault reaches 50% or more.
Eli's recoverable damages become $160,000 × 0.80 = $128,000. That still exceeds his unstacked $100,000 per-person UM limit, so unstacked he collects $100,000; stacked he collects $128,000 and no more, because UM never pays above actual damages.
For the passenger, Tennessee allocates liability among defendants rather than holding each liable for the whole. Suing Eli, she can collect only his 20% share - $6,000 - under his liability coverage; the other $24,000 is the uninsured driver's share and falls to UM under Eli's policy, since she is an insured occupant.
Keep the buckets separate: the liability limit, the UM per-person limit and the UM per-accident limit are distinct, and Eli's own UM recovery does not silently consume the coverage available to his passenger.