FORMAL OPINION
DATE: May 8, 1995
Subject: Crime Victims Compensation; Collateral Source; Under-Insured or Uninsured Coverage
Requested By: Gary B. Eichelberger, Director, N.C. Crime Control and Public Safety Division of Victim and Justice Services
Question: Does "collateral source," as defined by N.C.G.S. § 15B-2, include proceeds from under-insured or uninsured coverage paid to the victim on account of a DWI related collision?
Conclusion: Yes. Payments made to the victim pursuant to under-insured or uninsured coverage are a collateral source.
The Crime Victims Compensation Act, Chapter 15B of the General Statutes, provides that an award of compensation to an innocent victim of criminally injurious conduct will be reduced to the extent that the economic loss will be recouped from a collateral source. N.C.G.S. § 15B11(d).
N.C.G.S. § 15B-2(3) states in pertinent part:
"Collateral source" means a source of benefits or advantages for economic loss otherwise
compensable that the victim or claimant has received or that is readily available to him
from any of the following sources: . . . .
g. Proceeds of a contract of insurance payable to the victim for loss that he sustained
because of the criminally injurious conduct; . . . . (Emphasis added).
Criminally injurious conduct is defined in N.C.G.S. § 15B-2(5) which states in pertinent part: "Criminally injurious conduct includes conduct which amounts to an offense involving impaired driving as defined in N.C.G.S. § 20-4.01(24a)."
N.C.G.S. § 20-279.21 provides for mandatory uninsured and under-insured coverage in motor vehicle liability policies issued or delivered in the State of North Carolina. The statute specifically provides that the policy is for the protection of persons insured thereunder who are legally entitled to recover damages from owners or operators of uninsured motor vehicles and hit and run motor vehicles, because of bodily injury, sickness or disease including death resulting therefrom.
The supreme court has held that the purpose of the uninsured motorist statute "was to provide within fixed limits, some financial recompense to innocent persons who receive bodily injury or property damage, and to the dependents of those who lose their lives through the wrongful conduct of an uninsured motorist who can not be made to respond in damages." Moore v. Hartford Fire Insurance Company, 270 N.C. 532, 535, 155 S.E.2d 128, 130 (1967).
Uninsured and under-insured coverage are in effect statutorily mandated clauses in liability insurance policies issued or delivered in the State of North Carolina. The law requires the insurance company to stand in the place of the tort- feasor where the tort-feasor has failed to, or cannot be made to comply with North Carolina’s financial responsibility laws. See Brown v. Lumberman’s Mutual Casualty Company, 285 N.C. 313, 204 S.E.2d 829 (1974).
Therefore uninsured or under-insured coverage is a source of benefits or advantage for economic loss that a victim or claimant has readily available from a contract of insurance payable for the loss a victim or his family sustained as a result of criminally injurious conduct. The General Assembly has made clear its intent that for purposes of N.C.G.S. § 15B-2(3) uninsured and under-insured funds payable to the victim or the claimant are a collateral source.
MICHAEL F. EASLEY
Attorney General
Isaac T. Avery, III
Special Deputy Attorney General
Robert T. Hargett
Assistant Attorney General