Legal Memorandum: Definition of Insured and Minor Child

Issue: Under Michigan law, where parents of a minor child renegotiated "custodial parent" status, causing the minor child to take up residence with the other parent, absent any documentation memorializing this intention, will the minor child be deemed a member of the new "custodial parent’s" household under an automobile insurance policy?

           The typical motor vehicle insurance policy in Michigan provides uninsured motorist coverage.  It obligates the insurer to pay all sums, up to policy limits, which the insured shall be entitled to recover as damages.  Commonly, the term "insured" is defined as "the named insured and any relative."  There is no doubt that a minor child would be an insured under this provision. 

The case of Bierbusse v Farmer’s Ins Group, 84 Mich App 34; 269 NW2d 297 (1978), was decided based on statutory language and not on insurance policy language providing coverage to the insured and his relatives.  Similarly, in Workman v Detroit Auto Inter-Ins Exch, 404 Mich. 477; 274 NW2d 373 (1979), the court never quoted the applicable insurance policy, but instead relied entirely on statutory language that compels insurers to provide underinsurance coverage to their insureds.

No cases were discovered in Michigan that held that an insurer is obligated to provide coverage only to resident relatives when the policy clearly states that it provides coverage to "the named insured and any relative."  In Dairyland Ins Co v Auto Owners Ins Co, 123 Mich App 675, ___; 333 NW2d 322, 324 (1983), the policy in question provided coverage "to the person named in the policy, the person’s spouse, and a relative of either domiciled in the same household."  Similarly, in Smith v Auto Owners Ins Co, 123 Mich App 585, ___; 332 NW2d 620, 621 (1983), the policy provided benefits to "the person named in the policy, the […]