Federated American Insurance Co. v. Hansen

This case arises out of an uncontested statement of facts. Yvonne and R. A. Hill were the owners of two automobile insurance policies covering the same automobile and issued to them by Federated American Insurance Company (Federated) and American States Insurance Company (American). While driving the family car, Yvonne Hill struck Oscar D. Hansen causing him to suffer severe bodily injuries. Hansen commenced an action in superior court which was subsequently settled for the sum of $35,000. In the settlement of Hansens claim, American paid $20,000 of its insurance limit of $35,000, and Federated paid $15,000 of its $15,000 limit. These payments were made without prejudice to the rights of either company to prosecute a declaratory judgment action to determine the amount each company should have paid under the terms and conditions of their respective insurance policies.