## Facts

- Paula Lowing was injured as a passenger when the driver swerved to avoid a vehicle that ran a stop sign; the other driver fled and was never identified.
- The applicable Allstate policy provided uninsured motorist (UM) coverage for injuries caused by an unidentified motorist only if there was actual physical contact between vehicles.
- Lewis Horvath and three children were injured when Horvath swerved off the road to avoid an oncoming vehicle illegally passing in a no-passing zone; the other driver fled and was never identified.
- The applicable Continental policy likewise limited UM coverage for unknown motorists to accidents involving physical contact.
- Both insurers denied UM benefits because no collision occurred with the unidentified vehicles.
- In Lowing, the trial court granted summary judgment to Allstate; in Horvath, the trial court dismissed the complaint; the court of appeals affirmed both outcomes based on prior Arizona precedent upholding physical-contact limitations.
- The Arizona Supreme Court consolidated the cases to determine whether an unidentified accident-causing motorist is “uninsured” under A.R.S. § 20-259.01 and whether physical-contact limitations comply with that statute.

## Issues

1. Whether an unidentified accident-causing motorist qualifies as an “uninsured motorist” within A.R.S. § 20-259.01.
2. Whether a UM policy provision limiting coverage for unidentified motorists to accidents involving physical contact violates A.R.S. § 20-259.01.

## Decision

- The court held that an unidentified accident-causing motorist is “uninsured” within the meaning of A.R.S. § 20-259.01.
- The court held that policy provisions conditioning UM coverage for unidentified motorists on actual physical contact violate the statute and are void.
- The court overruled prior decisions that had upheld physical-contact requirements.
- The court reversed the judgments for the insurers and limited the decision’s application largely prospectively, while granting relief in the consolidated cases.

## Legal Principles

- A.R.S. § 20-259.01 is remedial and must be construed liberally to accomplish its purpose of protecting persons injured by financially irresponsible motorists.
- For UM purposes, an unidentified (“phantom”) accident-causing driver is treated as uninsured because the insured cannot realistically establish the driver’s insurance status or pursue the driver.
- Insurers may not impose contractual limitations (such as a physical-contact requirement) that narrow UM protection in ways not authorized by the statute.
- Fraud concerns in phantom-vehicle claims must be managed through ordinary burdens of proof and fact-finding, not by categorical exclusion of otherwise provable claims.

## Conclusion

Arizona’s Uninsured Motorist Act covers accidents caused by unidentified drivers, and UM policy provisions requiring physical contact as a condition of coverage are invalid because they conflict with A.R.S. § 20-259.01.


Lowing v. Allstate Ins. Co., 859 P.2d 724 (Ariz. 1993)