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ATTORNEYS FOR APPELLANTS Jay P. Kennedy Indianapolis, Indiana Andrew S. Friedman Elaine A. Ryan Phoenix, Arizona

ATTORNEYS FOR APPELLEES Karl L. Mulvaney Nana Quay-Smith Candace L. Sage Indianapolis, Indiana Arthur P. Kalleres Robert L. Gauss Brent W. Huber Indianapolis, Indiana

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In the

Indiana Supreme Court
_________________________________ No. 49S02-0510-CV-500 JAMES B. DUNN, ON BEHALF OF HIMSELF AND OTHERS SIMILARLY SITUATED, Appellants (Plaintiffs below), v. MERIDIAN MUTUAL INSURANCE COMPANY, AN INDIANA CORPORATION N/K/A STATE AUTOMOBILE MUTUAL INSURANCE COMPANY, AN OHIO CORPORATION, Appellees (Defendants below). _________________________________ Appeal from the Marion Superior Court, No. 49D11-0112-CP-2087 The Honorable John F. Hanley, Judge _________________________________ On Petition To Transfer from the Indiana Court of Appeals, No. 49A02-0208-CV-621 _________________________________ October 27, 2005 Boehm, Justice. We hold that uninsured motorist coverage of an automobile policy covers the liability of an uninsured motorist to the insured. If the insured's vehicle is damaged by an uninsured motor-

ist and the insurer chooses to repair the vehicle, the insurer must pay any diminished value of the insured's vehicle, in addition to any costs of repair up to the policy limits. Factual and Procedural Background In March 2001, James Dunn, a Tennessee resident, was involved in an accident in Tennessee. The record does not include any other information about the accident, but the parties agree that Dunn's uninsured motorist (UIM) coverage applied. Dunn had $10,000 in UIM coverage with a $200 deductible. Meridian Mutual Insurance Company, Dunn's insurer, inspected his car and paid for $3,108.30 in repairs and waived the deductible. As explained in greater detail, under Allgood v. Meridian Sec. Ins. Co., ___ N.E.2d ___ (Ind. 2005), Meridian's collision coverage is limited to repair or replacement of a damaged vehicle and does not require it to compensate its insureds for any diminution of the value of the car resulting from having been in an accident. Meridian contends that its policy gives its insureds the same result in the case of an accident in which an uninsured motorist is liable to its insured. Dunn filed a breach of contract claim against Meridian alleging that under his UIM coverage Meridian was required to pay not only for the cost of repairs to his car, but also for the diminished value of the car after the repairs attributable to it having been in an accident. Dunn's claim under UIM is only for the damage to his car including its diminished value, and appears to be in an amount under the UIM limit of $10,000. Dunn also sought certification as a class action. Meridian moved to dismiss for failure to state a claim upon which relief can be granted. Without deciding the class issue, the trial court granted Meridian's motion, finding that the policy was unambiguous and did not provide coverage for diminished value. 1 The Court of Appeals decided this case before we handed down our opinion in Allgood. Relying on its decision in that case, Allgood v. Meridian Sec. Ins. Co., 807 N.E.2d 131, 138 (Ind. Ct. App. 2004), aff'd by 812 N.E.2d 1065 (Ind. Ct. App. 2004), the Court of Appeals reversed and remanded. Dunn v. Meridian Mut. Ins. Co., 810 N.E.2d 739, 740 (Ind. Ct. App. 2004). We grant transfer. Applicable Law

1

The trial court purported to grant Meridian's motion to dismiss under Trial Rule 12(B)(6). Because documents other than the complaint were submitted to the trial court the disposition is treated as a grant of a motion for summary judgment. See Ind. Trial Rule 12(C).

2

An insurance policy is governed by the law of the principal location of the insured risk during the term of the policy. Hartford Accident & Indem. Co. v. Dana Corp., 690 N.E.2d 285, 291 (Ind. Ct. App. 1997), trans. denied; see also Restatement (Second) of Conflict of Laws

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