Rogers v. Farmers Ins. Co.

No. 432 May 20, 2026 691

IN THE COURT OF APPEALS OF THE

STATE OF OREGON

Karleanne ROGERS,

Plaintiff-Appellant,

v.

FARMERS INSURANCE COMPANY OF OREGON,

Defendant-Respondent.

Multnomah County Circuit Court

22CV38287; A182077

David F. Rees, Judge.

Argued and submitted January 29, 2025.

Lisa T. Hunt argued the cause for appellant. Also on the

briefs were Aaron D. Reichenberger, Law Office of Lisa T.

Hunt, LLC and Rosenbaum Law Group, PC.

Jacqueline Tokiko Mitchson argued the cause for respon-

dent. Also on the brief were Peder Rigsby, Sean D. McKean

and Bullivant Houser Bailey PC.

Before Shorr, Presiding Judge, Powers, Judge, and

Pagán, Judge.

POWERS, J.

Reversed and remanded.

Shorr, J., dissenting.

692 Rogers v. Farmers Ins. Co.

POWERS, J.

In this insurance coverage case, plaintiff appeals

from a general judgment dismissing her claims against

defendant, Farmers Insurance Company of Oregon

(Farmers). While driving her Mazda, plaintiff was hit by an

underinsured driver, resulting in injuries and economic and

noneconomic damages greater than the Mazda Uninsured/

Underinsured (UM/UIM) benefits. Plaintiff sought addi-

tional UIM coverage available through her policy for

another vehicle, also insured by Farmers. Farmers denied

that claim, asserting that the policy excludes UIM coverage

when the insured occupies a vehicle that she owns that is

not a described vehicle on the policy under which coverage

is sought. Plaintiff sued for breach of contract, arguing that

the policy exclusion was inconsistent with ORS 742.504(4)

(b) and thus impermissible. On cross-motions for summary

judgment, the trial court concluded that the exclusion was

consistent with the model policy provided for in statute

and granted Farmers’s motion for summary judgment and

denied plaintiff’s motion. As explained below, because the

policy exclusion is not consistent with ORS 742.504(4)(b), we

reverse and remand.

On review of cross-motions for summary judgment,

we view the record for each motion in the light most favor-

able to the party opposing it to determine whether there is

a genuine issue of material fact and, if not, whether either

party is entitled to judgment as a matter of law. O’Kain v.

Landress, 299 Or App 417, 419, 450 P3d 508 (2019).

The relevant background facts are few and undis-

puted. Plaintiff had two insurance policies with Farmers—

the Mazda policy and the Lexus policy—and each provided

for $100,000 UIM coverage. While driving her Mazda, plain-

tiff was hit by a driver traveling at a high speed. The colli-

sion caused plaintiff numerous injuries, resulting in medical

bills in excess of $100,000 and total economic and noneco-

nomic damages alleged at $750,000, subject to proof at trial.

The at-fault driver had a liability coverage limit of $15,000,

which was paid to plaintiff. Farmers paid plaintiff the

$100,000 UIM policy limit issued for her Mazda. Farmers,

however, denied UIM coverage in the second Farmers policy

Cite as 349 Or App 691 (2026) 693

issued for plaintiff’s Lexus. Plaintiff initiated the underly-

ing action against Farmers, alleging that the denial of cov-

erage under the Lexus policy was a breach of contract.

The parties filed cross-motions for summary judg-

ment. At the hearing on the motions, the parties disputed

whether the UIM exclusion set forth in Farmers’s policy was

enforceable and authorized under Oregon’s UIM model pol-

icy, as described in ORS 742.504, which we set out below.1

The court concluded that, because the terms of the Lexus

policy were consistent with the model policy in the stat-

ute, the exclusion was enforceable. Accordingly, it granted

Farmers’s motion for summary judgment and denied plain-

tiff’s motion. Plaintiff timely appealed.

On appeal, plaintiff renews her argument that,

under Farmers’s interpretation, the application of the pol-

icy exclusion results in less favorable coverage than the

coverage required under the model policy set forth in ORS

742.504(4)(b) and Oregon’s UIM law as construed in Batten

v. State Farm Mutual Automobile Ins. Co., 368 Or 538, 495

P3d 1222 (2021). Plaintiff asserts that the Mazda is “an

insured vehicle” within the meaning of the statute, and

therefore, the exclusion in the Lexus policy is unenforceable.

In support of her argument, plaintiff cites legislative history

and notes that, in 2015, the legislature amended the UIM

laws to allow “stacking” from the at-fault party’s liability

policy and the insured’s policies, and that the legislature

did not amend the exclusions set forth in section (4), thereby

showing—plaintiff argues—that section (4) does not have an

anti-stacking intent. Plaintiff maintains that, with respect

to UIM coverage, the protection follows the person, not the

vehicle.

For its part, Farmers agrees that typically UIM

follows the person but contends that there are permissible

exclusions, such as the one described in ORS 742.504(4)(b),

and that this case falls within that permissible exclusion. In

Farmers’s view, ORS 742.504(4)(b) unambiguously excludes

UIM coverage when the insured occupies a vehicle that she

1

ORS 742.504 has been amended since the underlying incident in this case.

Or Laws 2024, ch 73, § 153. Because the amendments do not affect our analysis,

we refer to the current version of the statute in this opinion.

694 Rogers v. Farmers Ins. Co.

owns that is not a described vehicle on the policy under

which coverage is sought. That is, Farmers remonstrates

that, although the legislative history supports a conclusion

that UIM coverage may be stacked with liability coverage

that the insured was able to collect from the at-fault driver,

it does not reveal an intent by the legislature to allow an

insured to recover UIM benefits while driving a vehicle that

is not insured under the particular policy from which the

insured seeks coverage. Farmers also relies on federal case

law, which has determined that similar exclusions are valid

under Oregon law.

As an initial matter, we begin with an overview of

the governing framework. In Oregon, insurance coverage

for loss caused by an uninsured or underinsured motor vehi-

cle is almost entirely a creature of statute. ORS 742.500 to

742.506; see Batten, 368 Or at 542 (so describing). The leg-

islature requires that “[e]very motor vehicle liability policy”

must provide for “uninsured motorist coverage” and “under-

insurance coverage.” ORS 742.502(1)(a), (5). UIM coverage

is insurance against the loss that occurs when an insured

suffers “bodily injury or death” related to a motor vehicle

accident for which another person is at fault and the at-fault

person has insufficient liability insurance to pay the dam-

ages that the injured person would have been “legally enti-

tled to recover” in a civil action against the at-fault person.

ORS 742.502(5); ORS 742.504(1)(a).

The legislature has set out in ORS 742.504 “a com-

prehensive model” policy of UM/UIM coverage. Vega v.

Farmers Ins. Co., 323 Or 291, 302, 918 P2d 95 (1996). The

model policy requires that all automobile insurance policies

“shall provide uninsured motorist coverage that in each

instance is no less favorable in any respect to the insured or

the beneficiary than if the following provisions were set forth

in the policy.” ORS 742.504. The comprehensive UM/UIM

model policy “may be varied only in the sense that terms that

disfavor insureds may be excluded or softened and extrane-

ous terms that are neutral or that favor insureds may be

added.” Vega, 323 Or at 302; see also Sheppard v. Progressive

Classic Ins. Co., 375 Or 262, 273, ___ P3d ___ (2026) (reiter-

ating Vega and explaining that the “model policy set forth

Cite as 349 Or App 691 (2026) 695

under that statute represents the minimum coverage; that

is, an actual policy must provide coverage at least as favor-

able to the insured as the model”). Therefore, to determine

the enforceability of a provision for UIM coverage, we must

compare the coverage provided in the challenged policy with

the coverage provided by the provisions set forth in ORS

742.504. See Vega, 323 Or at 299 (explaining “that the valid-

ity of a challenged UIM provision must be tested, not by a

direct comparison between the challenged provision with an

individual statutory provision but, instead, by a comparison

between coverage offered by the policy containing the chal-

lenged provision and the coverage offered by a hypothetical

policy containing the provisions set out at ORS 742.504(1) to

(12)”).

When a question of statutory interpretation arises

in an insurance coverage dispute, we resolve it “by applying

familiar rules requiring us to determine the meaning of the

words of the statute most likely intended by the legislature

that enacted it, taking into account its text in context and

the relevant legislative history.” Spearman v. Progressive

Classic Ins. Co., 361 Or 584, 590, 396 P3d 885 (2017) (citing

State v. Gaines, 346 Or 160, 171-73, 206 P3d 1042 (2009));

Vega, 323 Or at 300 (explaining that, where a statutory pro-

vision controls a UIM policy provision, we resolve the ques-

tion by applying the methodology for interpreting statutes).

We begin with common ground. The parties’ argu-

ments acknowledge that the Lexus policy provides that

Farmers “will pay all sums which an insured person is

legally entitled to recover as damages from the owner or

operator of an uninsured or underinsured motor vehicle

because of bodily injury sustained by the insured person.”

The Lexus policy specifies various exclusions, including that

the coverage does not apply to bodily injury sustained by

a person “[w]hile occupying any vehicle owned by you or a

family member for which insurance is not afforded under

this policy or through being struck by that vehicle.” Based

on that language, the parties agree that the Lexus policy

excludes UIM coverage for plaintiff in this scenario.

The parties also agree that ORS 742.504 requires

that “[e]very policy required to provide the coverage

696 Rogers v. Farmers Ins. Co.

specified in ORS 742.502 shall provide uninsured motorist

coverage that in each instance is no less favorable in any

respect to the insured or the beneficiary than if the follow-

ing provisions were set forth in the policy.” ORS 742.504(1)

(a) requires that “the insurer will pay all sums that the

insured * * * is legally entitled to recover as damages from

the owner or operator of an uninsured vehicle because of

bodily injury sustained by the insured caused by accident

and arising out of the ownership, maintenance or use of the

uninsured vehicle.” Finally, the parties’ arguments proceed

from the assumption that, at least generally, UIM coverage

follows the person, not the vehicle. See Batten, 368 Or at

540 (concluding that the insurer must pay UM/UIM benefits

under all applicable policies).

The parties’ dispute centers on their interpretation

of ORS 742.504(4)(b), which describes permissible exclu-

sions from the UIM coverage, including that the “coverage

does not apply to bodily injury to an insured while occupy-

ing a vehicle, other than an insured vehicle, owned by, or

furnished for the regular use of, the named insured or any

relative resident in the same household, or through being

struck by the vehicle.” The parties specifically disagree as to

whether the Mazda qualifies as “an insured vehicle” under

that exclusion.

ORS 742.504(2) includes definitions for both “insured

vehicle” and “uninsured vehicle.” An “insured vehicle,” as

defined in the model policy and as relevant here, includes

“the vehicle described in the policy or a newly acquired or

substitute vehicle, * * *.” ORS 742.502(2)(d)(A). In contrast,

an “uninsured vehicle” includes, as relevant here, a “vehi-

cle with respect to the ownership, maintenance or use of

which there is no collectible motor vehicle bodily injury

liability insurance, * * * applicable at the time of the acci-

dent with respect to any person * * *.” ORS 742.504(2)(k)(A).

Importantly, ORS 742.502(2)(L)(F) explicitly provides that

an “uninsured vehicle” does not include a “vehicle owned by

or furnished for the regular or frequent use of the insured or

any member of the household of the insured.”

Weaving those definitions together, it becomes

apparent that the Mazda was not an “uninsured vehicle.”

Cite as 349 Or App 691 (2026) 697

That is, it is undisputed that the Mazda was a “vehicle

owned by or furnished for the regular or frequent use of”

plaintiff. See ORS 742.504(2)(L)(F). It is also undisputed

that the Mazda was not a vehicle for “which there [was] no

collectible motor vehicle bodily injury liability insurance,

* * * applicable at the time of the accident with respect to

any person.” See ORS 742.504(2)(k)(A). Therefore, under the

terms of the model policy, the Mazda would not be an “unin-

sured vehicle.” That conclusion then informs how to view

the definition of an “insured vehicle,” meaning the phrase

“the vehicle described in the policy,” as used in the definition

of “insured vehicle,” means the policy associated with that

vehicle.

Farmers asserts that, because the definition of

“insured vehicle” limits it to the vehicle described in “the

policy,” the plain text clearly and unambiguously allows for

the exclusion, given that the Mazda is not described in the

Lexus policy. Although that is a plausible interpretation

when viewed in isolation, the text becomes ambiguous when

we consider it in the context of the definition of “uninsured

vehicle” and the specific exclusion of uninsured vehicles. We

recognize that, in some instances, the legislature’s use of

the definite article “the” can inform our statutory analysis.

See, e.g., Carroll and Murphy, 186 Or App 59, 68, 61 P3d

964 (2003) (drawing a distinction between the definite arti-

cle “the” from the indefinite article “a” as an indication that

the legislature was referring to a specific, previously men-

tioned statutory phrase, rather than any instance of that

phrase). Here however, because the legislature also provided

a definition of “uninsured vehicle,” we cannot rely on the

use of the definite article “the” as indicative of the legisla-

ture’s intent. Indeed, although the legislature used the term

“the policy” and Farmers contends that “the policy” actu-

ally means “this policy,” it is particularly significant that

the legislature did not use “this policy” in this part of the

statutory framework like it did elsewhere. Compare ORS

742.504(2)(d)(A) (providing that an “Insured vehicle” means

“[t]he vehicle described in the policy * * *” (emphasis added))

with ORS 742.504(1)(b) (providing that no judgment against

a person or organization “alleged to be legally responsible

for bodily injury, except for proceedings instituted against

698 Rogers v. Farmers Ins. Co.

the insurer as provided in this policy, shall be conclusive

* * *, as between the insured and the insurer, on the issues

of liability of the person or organization or of the amount of

damages to which the insured is legally entitled” (emphasis

added)).

To the extent that Farmers argues that a vehicle

can be neither an insured nor uninsured vehicle, we reject

that argument. We are not persuaded that the legislature

intended to make a third, unspecified class of vehicles that

is neither insured nor uninsured when it enacted the model

UM/UIM policy terms. Thus, we reject Farmers’s contention

that the term “the policy” is as narrow as Farmers asserts.

Moreover, as a practical matter, the parties agree

that if plaintiff had been hit by an underinsured driver

while biking, walking, or as a passenger in a non-owned

vehicle that was not available for her regular use, she would

be able to recover under both the Mazda and Lexus UIM

coverages. See Batten, 368 Or at 540 (concluding that when

a cyclist, a passenger in a rented car, and a pedestrian suf-

fered losses that were within the scope of UM/UIM cov-

erage—and each plaintiff had multiple applicable policies

with UM/UIM coverage—the insurer was required to pay

the plaintiffs under all of the applicable policies). We decline

to create the anomaly that Farmers’s interpretation would

establish, viz., while driving her owned and insured vehicle,

plaintiff would have less coverage than when walking or as

a passenger in another vehicle.

To the extent Farmers points to federal decisions

that have reached a contrary result, we note that those

decisions are not binding on us. See Shaw v. PACC Health

Plan, Inc., 322 Or 392, 401 n 8, 908 P2d 308 (1995) (observ-

ing that federal court decisions, other than those issued

by the Supreme Court, are not binding on Oregon courts).

Furthermore, nothing in those opinions persuade us that

our conclusion, which is rooted in the text and context

as required by Oregon law, is incorrect. Finally, we have

reviewed the legislative history surrounding the 2015

amendments to ORS chapter 742, and we did not find any

pertinent legislative history that shed additional light on

the legislature’s intent.

Cite as 349 Or App 691 (2026) 699

Ultimately, because the text and context of the

model policy are such that the Mazda is “an insured vehicle,”

and thus is not included in the exclusion, we conclude that

the Farmers policy terms do not comply with Oregon law and

are, therefore, unenforceable. See Sheppard, 375 Or at 273

(“If any policy term is less favorable to the insured than the

model policy, then that term is unenforceable.”). Accordingly,

the trial court erred by granting Farmers’s motion for sum-

mary judgment and denying plaintiff’s motion.

Reversed and remanded.

SHORR, P. J., dissenting.

I respectfully dissent from the majority’s conclusion

that the Lexus policy exclusion is inconsistent with ORS

742.504(4)(b). As explained below, I would conclude that the

exclusion is consistent with the statute and that the trial

court therefore did not err in granting defendant’s motion

for summary judgment.

The relevant portion of the Lexus policy stated:

“(3) This coverage does not apply to bodily injury sus-

tained by a person:

“(a) While occupying any vehicle owned by you or a

family member for which insurance is not afforded under

this policy or through being struck by that vehicle.

“* * * * *

“(4) This coverage does not apply to bodily injury sus-

tained by an insured person while occupying any vehicle

(other than your insured car) owned by, or furnished for the

regular use of, you or a family member or through being

struck by that vehicle.”

The exclusion applies to the situation at hand: plaintiff was

injured while occupying the Mazda (a vehicle owned by her)

and insurance was not afforded to the Mazda under the

Lexus policy. The question thus becomes whether the exclu-

sion is enforceable.

The legislature has set out in ORS 742.504 a “com-

prehensive model” policy for uninsured and underinsured

motorist coverage. Vega v. Farmers Ins. Co., 323 Or 291, 302,

700 Rogers v. Farmers Ins. Co.

918 P2d 95 (1996). Every policy providing such required cov-

erage “shall provide uninsured motorist coverage that in each

instance is no less favorable in any respect to the insured or the

beneficiary” than if the provisions contained in ORS 742.504

were set forth in the policy. ORS 742.504. The model policy

includes numerous categories of minimum terms, including

noting some permissible exclusions. Under ORS 742.504(4)(b)

it is permissible for a policy to include the following exclusion:

“This coverage does not apply to bodily injury to an

insured while occupying a vehicle, other than an insured

vehicle, owned by, or furnished for the regular use of, the

named insured or any relative resident in the same house-

hold, or through being struck by the vehicle.”

In other words, a policy need not provide coverage for the

insured’s owned vehicles other than an insured vehicle. The

meaning of an “insured vehicle” in that model exclusion is

where I part ways with the majority.

ORS 742.504(2)(d) defines “insured vehicle” as

“(A) The vehicle described in the policy or a newly

acquired or substitute vehicle, as each of those terms is

defined in the public liability coverage of the policy, insured

under the public liability provisions of the policy; or

“(B) A nonowned vehicle operated by the named

insured or spouse if a resident of the same household, pro-

vided that the actual use thereof is with the permission of

the owner of the vehicle and the vehicle is not owned by nor

furnished for the regular or frequent use of the insured or

any member of the same household.”

I read subparagraph (A) as applying to the vehicle

described in and insured by the specific policy at issue (or a

newly acquired or substitute vehicle), and not, as the major-

ity does, as applying to any vehicle described in a motor

vehicle insurance policy. With that understanding, plain-

tiff’s Mazda was not an “insured vehicle” under the Lexus

policy because it was not the vehicle described in the Lexus

policy (or a newly acquired or substitute vehicle), and it was

not a “nonowned” vehicle as described in subparagraph (B).

Generally, when engaging in statutory construc-

tion, Oregon courts have treated the use of the definite

Cite as 349 Or App 691 (2026) 701

article “the” as signifying a narrow intent, as “a reference to

‘something specific, either known to the reader or listener or

uniquely specified.’ ” Hickey v. Scott, 370 Or 97, 107, 515 P3d

368 (2022) (quoting State v. Lykins, 357 Or 145, 159, 348 P3d

231 (2015)); see also Carroll and Murphy, 186 Or App 59, 68,

61 P3d 964 (2003) (explaining that the legislature uses “a,”

as an indefinite article, to refer to an unidentified, undeter-

mined, or unspecified object and uses “the” to indicate the

intention to refer to a definite object). Were ORS 742.504

(2)(d) to define “insured vehicle” as “a vehicle described in a

policy” or “a vehicle that is insured,” that would signal an

intent to use the term to refer to any vehicle covered by an

insurance policy. However, I interpret the use of the defi-

nite article “the,” as to both the vehicle and the policy, as

being limited to the specific policy at issue and the vehicle

described therein. Furthermore, read in context, I do not

interpret the statute’s variable use of “the policy” and “this

policy” as creating a distinction. See, e.g., ORS 742.504(3)

(“This coverage applies only to accidents that occur on and

after the effective date of the policy, during the policy period

and within the United States of America, its territories

or possessions, or Canada.”); ORS 742.504(8) (“No action

shall lie against the insurer unless, as a condition prece-

dent thereto, the insured or the legal representative of the

insured has fully complied with all the terms of this policy.”).

Therefore, the permissible exclusion extends to the insured’s

owned vehicles, other than the vehicle described in the pol-

icy at hand. See also Sheppard v. Progressive Classic Ins.

Co., 375 Or 262, 271, ___ P3d ___ (2026) (discussing uses of

the phrase “furnished for the regular use,” as used in ORS

742.504(4)(b), and noting a common automobile insurance

policy exclusion: “A policy will state that the policy does not

cover liability as to any vehicle that is not expressly covered

and that is either owned by the insured or ‘[f]urnished or

available for [the insured’s] regular use.” (Quoting William

J. Schermer and Irvin E. Schermer, 1 Automobile Liability

Insurance § 6:10 (4th ed Westlaw, updated Nov 2025) (brack-

ets in Sheppard).)).

As the majority points out, that interpretation cre-

ates a third category of vehicle that is neither an “insured

vehicle” nor an “uninsured vehicle,” because “uninsured

702 Rogers v. Farmers Ins. Co.

vehicle” does not include “a vehicle owned by * * * the

insured.” ORS 742.504(2)(L)(F). However, I do not under-

stand that result to be a logical inconsistency or an unin-

tended consequence. I do not think that the term “insured

vehicle,” when given a specific definition for purposes of use

in a particular document, must necessarily be the opposite

of “uninsured vehicle.” The two definitions do not encompass

every vehicle in existence and place them in the binary of

“insured” or “uninsured” for purposes of the policy at issue.

I therefore do not consider it problematic to conclude that

the Mazda was neither an insured vehicle nor an uninsured

vehicle as those terms are defined in the Lexus policy.

Finally, I do not consider my interpretation to be

inconsistent with Batten v. State Farm Mutual Automobile

Ins. Co., 368 Or 538, 495 P3d 1222 (2021). In that case, the

various plaintiffs were injured while riding as a passenger

in a rental car, operating a bicycle, or walking in the street,

and the Supreme Court concluded that they could each

recover UM/UIM payments from multiple policies. Batten,

368 Or at 540-41. The court concluded that the term of the

relevant policies that limited coverage to the maximum pay-

out under one policy had the effect of denying payment on

the other policies, which was inconsistent with the model

terms of ORS 742.504, and thus was unenforceable. Id. at

551. Here, I believe the relevant term of the Lexus policy is

consistent with the model terms. ORS 742.504(4)(b) reflects

a legislative judgment that this particular situation is one

in which an insurer may legitimately exclude coverage:

A policy need not cover incidents involving the insured’s

owned vehicles that are not named in that particular policy.

The plaintiffs in Batten were not injured while occupying

their owned vehicles that were not named in the particular

policies.

I therefore respectfully dissent.