Hardester v. Eubanks

¶1dissenting. I believe the majority has focused too narrowly on the term “covered claim,” ignoring the intent behind the “Property and Casualty Insurance Guaranty Act.” Ark. Stat. Ann. § 66-5501 et seq. (Repl. 1980). The purpose is to provide protection from insolvent insurance carriers by creating a fund contributed by other carriers and, indirectly, by the public. The act places a ceiling of $300,000 on “covered claims” so as to provide a wider distribution of recovery among existing claimants. The act expressly provides that individual covered claims “shall” be limited to $300,000 and “Shall not include any amount in excess of $300,000” (My emphasis). Considering the overall intent and spirit of the act I do not believe it was intended to exclude amounts advanced to the insured on a particular loss which is still being processed at the time insolvency occurs. The fact that one claim has been partially processed at the time of insolvency and an interim payment made, should not give that claimant a preference over another claimant of equal standing. Under that approach, claimants whose losses may have occurred simultaneously, or even previously, to Ms. Hardester but who are still unpaid at insolvency are limited to $300,000, whereas Ms. Hardester is not. That was not the purpose of the act. I believe the trial court should be affirmed.