Background
Connor Balzan was injured as a passenger in a 2019 car accident, and his damages exceeded the at-fault driver’s insurance limits. Connor was a named insured on a State Farm UIM policy covering his own 2013 Hyundai Elantra ($250,000 in UIM coverage), which State Farm paid out in full. His parents, Russell and Kimberly Balzan, were the named insureds on four additional State Farm household vehicle policies — covering a Jeep Wrangler, a Mercedes S550, an Infiniti QX80, and a Kia Soul — each providing $250,000 in UIM coverage and funded with community property funds. State Farm paid UIM limits under one of those four household policies but refused to pay the remaining three, invoking an anti-stacking clause in all five policies restricting recovery to a single selected policy when “multiple policies or coverages purchased by one insured” apply to the same accident.
Connor argued that Russell and Kimberly were two separate insureds — not one — and therefore the anti-stacking provision did not apply to consolidate their four household policies into a single recoverable unit. The Maricopa County Superior Court granted summary judgment for State Farm. The Arizona Court of Appeals affirmed the result but on different reasoning: it agreed Russell and Kimberly were two distinct insureds, yet held that because they jointly purchased the household policies, they were jointly bound by the anti-stacking provision as a unit. The Arizona Supreme Court granted review to resolve the recurring statutory question of who qualifies as “one insured” under A.R.S. § 20-259.01(H).
Connor also argued that his sister Madison effectively purchased the Kia Soul policy by reimbursing premium payments, which would have made her a separate insured purchaser. The court of appeals rejected that argument, and the Supreme Court declined to review it.
The Court’s Holding
The Arizona Supreme Court unanimously affirmed the superior court’s grant of summary judgment for State Farm, vacating the court of appeals’ reasoning on the “one insured” question. The Court held that the phrase “purchased by one insured” in A.R.S. § 20-259.01(H) refers to the named insured who exercised the statutory legal authority to obtain UIM coverage — not to every person who may have contributed funds toward the premium. Where multiple named insureds jointly procure policies, or where one named insured acts on behalf of another in obtaining coverage, they function collectively as a single purchasing unit and constitute “one insured” for purposes of the anti-stacking provision.
Finding the statutory phrase ambiguous on its face, the Court turned to secondary interpretive tools, including the statute’s structure, purpose, and case law. It reasoned that § 20-259.01(B) assigns the authority to accept, reject, or select UIM coverage exclusively to the named insured, and that election is binding on all persons covered under the policy. Treating every financial contributor as a separate “purchaser” would undermine that framework, render the anti-stacking provision largely toothless, and create intractable line-drawing problems about who counts as a purchaser.
The Court also rejected the argument that Arizona community property law compelled treating Russell and Kimberly as separate purchasers. Community property principles govern ownership of marital assets, not the legal authority to procure insurance contracts. The source of premium funds — community or otherwise — is immaterial to the statutory question of who exercised the authority to obtain coverage. Because Russell and Kimberly either jointly procured the household policies or one acted on behalf of both, they constitute “one insured” under § 20-259.01(H), and State Farm properly limited Connor’s recovery to one household policy in addition to his own Hyundai policy.
Key Takeaways
- “Purchased by one insured” in Arizona’s UIM anti-stacking statute (A.R.S. § 20-259.01(H)) means the named insured who exercised statutory authority to obtain coverage — not every person who contributed money toward the premium.
- When spouses are co-named insureds who jointly procure multiple vehicle policies, they are treated as a single purchasing unit under § 20-259.01(H), enabling the insurer to enforce the anti-stacking provision across all jointly purchased policies.
- Community property law does not expand the class of statutory purchasers; funding premiums with community funds does not make each spouse an independent purchaser for anti-stacking purposes.
- An injured family member covered under jointly purchased household policies may recover UIM benefits under only one selected household policy (plus any separately purchased policy of their own), even if multiple household policies would otherwise apply.
Why It Matters
This decision resolves a significant gap in Arizona UIM law by clarifying that “one insured” in the anti-stacking statute is defined by legal authority to procure coverage, not by financial contribution to premiums. For insurers, the ruling confirms that anti-stacking provisions are enforceable against jointly purchased household policies without regard to which spouse’s funds paid for them, providing clearer guidance for claim handling in multi-policy family situations. For policyholders and plaintiffs’ attorneys, it means that family members injured by underinsured drivers cannot multiply available UIM benefits by pointing to separate community-property interests in each household vehicle policy.
The decision also pushes back against a reading that would have dramatically broadened stacking rights by treating married co-named insureds as distinct purchasers. By anchoring the anti-stacking provision to the named insured’s statutory role — rather than to domestic-relations principles or contribution of funds — the Court draws a workable, policy-centered line that aligns subsection (H) with the broader framework of Arizona’s UM/UIM Act and the Legislature’s intent to permit reasonable limits on multiple recoveries.