The Arizona Supreme Court issued a unanimous decision Thursday in State Farm Automobile Insurance Company v. Jacey Lee Orlando, vacating a Court of Appeals ruling and affirming the original Superior Court judgment in a case that clarifies the scope of underinsured motorist coverage for all-terrain vehicle accidents.
The case, filed May 29, 2025, centers on a fundamental question of insurance law: whether Arizona's Uninsured/Underinsured Motorist Act requires coverage for ATV accidents that occur off public roads. The dispute arose from an insurance coverage claim filed by defendant Jacey Lee Orlando against State Farm following an ATV-related incident.
Justice Montgomery authored the court's opinion, joined by Chief Justice Timmer, Vice Chief Justice Lopez, and Justices Bolick, Beene, King, and retired Justice Brutinel. The unanimous decision demonstrates the court's clear interpretation of Arizona's insurance coverage requirements.
At the heart of the case lies Arizona's Uninsured/Underinsured Motorist Act, which requires insurers selling motor vehicle liability policies to offer policyholders underinsured motorist coverage. Under Arizona Revised Statutes Section 20-259.01(B), this coverage allows insured individuals to file claims with their own insurers to recover the difference between damages suffered in an accident and amounts paid by an at-fault motorist's liability policy.
The legal proceedings began in Maricopa County Superior Court, where Judge Katherine M. Cooper initially ruled in favor of State Farm. Orlando appealed that decision to the Arizona Court of Appeals, Division One, which issued a ruling in 2023 that was published in 256 Ariz. 55. However, the Supreme Court's recent decision vacated that appellate ruling and affirmed the original trial court judgment.
The case attracted significant attention from the insurance industry, with multiple organizations filing amicus briefs. The American Property Casualty Insurance Association supported State Farm's position through counsel from Dickinson Wright PLLC, including attorneys Bennett Evan Cooper, Timothy M. Strong, and Alexandra Crandall.
On the opposing side, the Arizona Association for Justice and Arizona Trial Lawyers Association filed amicus briefs supporting Orlando's position, represented by attorney David L. Abney of Ahwatukee Legal Office.
State Farm was represented by a team from two prominent Phoenix law firms. David M. Bell and Christopher Robbins from Hill, Hall, Stark & Ferraro worked alongside Lawrence A. Kasten, Todd Feltus, and Kory J. Koerperich from Lewis Roca Rothgerber Christie LLP. Kasten presented oral arguments for State Farm.
Orlando was represented by Phoenix attorney Mick Levin of Mick Levin, P.L.C., who also argued the case before the Supreme Court.
The Supreme Court's analysis focused on determining what constitutes covered activity under Arizona's UIM provisions. The opinion specifically addresses whether the location of an ATV accident affects insurance coverage obligations under state law.
Underinsured motorist coverage serves as a crucial safety net for accident victims when at-fault drivers carry insufficient insurance to cover damages. The coverage typically applies when an insured person suffers injuries in a motor vehicle accident and the at-fault party's liability limits are inadequate to compensate for the full extent of damages.
The court's decision clarifies important boundaries for UIM coverage in Arizona, particularly regarding recreational vehicle accidents that occur away from traditional roadways. This distinction could affect how insurers assess coverage obligations and how policyholders understand their protection under UIM provisions.
The case's journey through Arizona's court system illustrates the complexity of insurance coverage disputes. Beginning with the 2020 Superior Court case and proceeding through the Court of Appeals before reaching the state's highest court, the litigation demonstrates how insurance law questions can require extensive judicial review.
The unanimous nature of the Supreme Court's decision suggests clear legal principles guided the justices' analysis. When appellate courts issue unanimous opinions, it typically indicates the legal reasoning was straightforward once properly analyzed under applicable statutes and precedent.
For insurance practitioners and policyholders, the decision provides important guidance on the scope of UIM coverage under Arizona law. The ruling may influence how insurance companies draft policies and how courts interpret coverage obligations in similar cases involving recreational vehicles and off-road accidents.
The case also highlights the ongoing importance of Arizona's Uninsured/Underinsured Motorist Act in protecting accident victims. As recreational vehicle use continues to grow, courts will likely face additional questions about how traditional insurance concepts apply to modern transportation and recreation patterns.
Legal experts expect the decision to provide clarity for both insurers and policyholders regarding coverage expectations for ATV and similar recreational vehicle incidents. The ruling establishes precedent that may guide lower courts in future insurance coverage disputes involving similar factual circumstances.