                   United States Court of Appeals
                         FOR THE EIGHTH CIRCUIT
                                 ___________

                                 No. 04-3576
                                 ___________

Monte A. Murray; Jane Murray,          *
                                       *
           Plaintiffs - Appellants,    *
                                       * Appeal from the United States
     v.                                * District Court for the Western
                                       * District of Missouri.
American Family Mutual Insurance       *
Company,                               *
                                       *
           Defendant - Appellee.       *
                                  ___________

                            Submitted: May 11, 2005
                                Filed: November 17, 2005
                                 ___________

Before LOKEN, Chief Judge, BEAM and MELLOY, Circuit Judges.
                              ___________

MELLOY, Circuit Judge.

       Monte and Jane Murray brought this action against American Family Mutual
Insurance Company (“American Family”) for failure to provide insurance benefits,
breach of contract, and failure to procure insurance. The district court1 granted
summary judgment to American Family and the Murrays now appeal. We affirm in
part and reverse in part.


      1
       The Honorable John T. Maughmer, United States Magistrate Judge for the
Western District of Missouri.
I.    Facts

       The facts underlying this lawsuit are largely undisputed. On December 15,
2000, the car in which the Murrays were riding collided with a car driven by Linda
Hohnbaum. Mr. Murray suffered serious injuries, and Mrs. Murray suffered damages
as a result of her husband’s injuries.

       At the time of the accident, the Murrays were insured by American Family
through six automobile policies, one for each vehicle owned by the Murrays,
including the vehicle involved in the collision. All six of the Murrays’ insurance
policies included uninsured motorist coverage of $100,000 per person and $300,000
per accident. Four of the six policies also included underinsured motorist coverage
of $100,000 per person and $300,000 per accident. The Murrays also had a personal
umbrella policy that provided liability coverage of $1,000,000, but it did not contain
uninsured nor underinsured motorist coverage.

      The vehicle Hohnbaum was driving at the time of the accident was a rental car
owned by National Car Rental Financing, LP (“National Car Rental”). When
Hohnbaum rented the vehicle, she declined liability coverage through National Car
Rental. At the time of the accident, Hohnbaum was insured by Allstate Insurance
Company (“Allstate”) with an automobile insurance policy issued in Florida. The
policy included $10,000 liability coverage that insured Hohnbaum, regardless of
whether she owned the vehicle she was driving.

      The Murrays brought an action against Hohnbaum in the Circuit Court of
Johnson County, Missouri, on January 16, 2001. After a bench trial, the court found
Hohnbaum 100% liable for the accident and awarded damages of $1,606,889.54 to
Mr. Murray and $160,690.11 to Mrs. Murray, including prejudgment interest.
Following the judgment, Allstate paid the Murrays $10,000.



                                         -2-
       National Car Rental was self-insured at the time of the accident. On September
4, 2001, the Murrays’ attorney sent a letter to National Car Rental’s attorney, stating,
in part:

      It is my understanding that you represent National Car Rental and that
      your client takes the position that there is no liability insurance or self-
      insurance available through your client for the motor vehicle wreck of
      December 15, 2000. Is that correct? . . . This letter is to advise that my
      clients will settle with National Car Rental for their injury claim and loss
      of services for $15,000.2

On September 15, 2001, National Car Rental’s attorney faxed a brief letter to the
Murrays’ attorney stating that he “need[ed] clarification of your demand.” On
September 17, 2001, the Murrays’ attorney responded by writing:

      I acknowledge receipt of your fax of September 15, 2001. Apparently
      my letter of September 4, 2001, has caused confusion. Accordingly, I
      am hereby withdrawing the offer to settle stated in my letter of
      September 4, 2001. . . . As I understand it, Allstate takes the position
      that National Car Rental under Missouri law is responsible for $15,000


      2
       Unlike some states, Missouri does not generally impose vicarious liability on
a vehicle owner for the negligence of another person operating the vehicle. See
Chandler v. New Moon Homes, Inc., 418 S.W.2d 130, 135 (Mo. 1967) (en banc)
(“The owner can only be made liable for the negligent use of a motor vehicle, whether
commercial or pleasure, by another upon some application of the principle of
respondeat superior.”). However, Missouri does require all vehicle owners to carry
a minimum of $25,000 in insurance that covers any person “using any such motor
vehicle or motor vehicles with the express or implied permission of such named
insured, against loss from the liability imposed by law for damages arising out of the
ownership, maintenance or use of such motor vehicle or motor vehicles . . . .” Mo.
Rev. Stat. § 303.190. As a self-insurer, National Car Rental was responsible for
$15,000 of the judgment against Hohnbaum–the statutory minimum insurance level
of $25,000 minus the $10,000 liability policy Hohnbaum had through Allstate.


                                          -3-
      which with Allstate’s $10,000 arguably satisfies Missouri minimum
      liability requirements. Do you agree? Please send me a letter setting
      forth National Car Rental’s position. . . . I thereafter will make a formal
      offer.

A senior claims adjuster subsequently authorized National Car Rental’s attorney “to
pay the $15,000 demanded due to the fact that the $15,000, when added to the
$10,000 to be paid by Allstate, would satisfy the $25,000 minimum liability coverage
limit required by the State of Missouri.”

      On November 13, 2001, National Car Rental filed for Chapter 11 bankruptcy
in Delaware. However, the bankruptcy court approved the proposed payment of
$15,000 to the Murrays. The Murrays never accepted the offer from National Car
Rental.

      On March 29, 2002, the Murrays filed suit against American Family in the
Circuit Court of Johnson County, Missouri. The Murrays sought payment of
uninsured motorist benefits, or, in the alternative, payment of underinsured motorist
benefits. The Murrays also sought damages for breach of contract and failure to
procure insurance related to the umbrella policy issued to them by American Family.

      A.     Policy Language - Uninsured Motorists Coverage

      The Murrays’ uninsured motorist coverage stated, in all capitals, “Uninsured
motorists – bodily injury only $100,000 each person $300,000 each accident.” The
policy also stated:

      We will pay compensatory damages for bodily injury which an insured
      person is legally entitled to recover from the owner or operator of an
      uninsured motor vehicle. The bodily injury must be sustained by an
      insured person and must be caused by accident and arise out of the use
      of the uninsured motor vehicle.

                                         -4-
Later in the section, the policies defined an “uninsured motor vehicle”:

      Uninsured motor vehicle means a motor vehicle which is:

      ***

      b.     Insured at the time of the accident by a liability bond or policy
             with bodily injury liability limits below the minimum required by
             the financial responsibility law of the state in which your insured
             car is principally garaged.

      ***

      d.     Insured by a bodily injury liability bond or policy at the time of
             the accident but the company denies coverage or is or becomes
             insolvent within two years from the date of the accident.

      Uninsured motor vehicle, however, does not mean a vehicle:
      a.   Owned by or furnished or available for the regular use of you or
           any resident of your household.
      b.   Owned or operated by a self-insurer as considered by any
           financial responsibility law, motor carrier law, or similar law.

Missouri law requires that all automobile insurance issued within the state include
uninsured motorist coverage. Harris v. Shelter Mut. Ins. Co., 141 S.W.3d 56, 62 (Mo.
Ct. App. 2004) (citing Mo. Rev. Stat. § 379.203).

      B.     Policy Language - Underinsured Motorists Coverage

       Four of the Murrays’ policies included underinsured motorist coverage. These
policies stated, in all capitals, “Underinsured Motorist Coverage – bodily injury only
$100,000 each person $300,000 each accident.” The policy later explained:

      We will pay compensatory damages for bodily injury which an insured
      person is legally entitled to recover from the owner or operator of an

                                         -5-
      underinsured motor vehicle. The bodily injury must be sustained by an
      insured person and must be caused by accident and arise out of the use
      of the underinsured motor vehicle.

The policies defined an underinsured motor vehicle:

      Underinsured motor vehicle means a motor vehicle which is insured by
      the liability bond or policy at the time of the accident which provides
      bodily injury liability limits less than the limits of the liability of this
      underinsured motorists coverage.
      Underinsured motor vehicle, however, does not mean a vehicle:
      a.     Insured under the Liability coverage of this policy.
      b.     Insured at the time of the accident by a liability bond or policy
             with bodily injury liability limits below the minimum specified by
             the financial responsibility law of the state in which your insured
             car is principally garaged.
      c.     Owned by or furnished or available for the regular use of you or
             a relative.
      d.     Owned or operated by a governmental unit or agency.
      e.     Owned or operated by a self-insurer as considered by any
             financial responsibility law, motor carrier law, or similar law.
      f.     Which is insured by a bodily injury liability bond or policy at the
             time of the accident, but the bonding or insuring company denies
             coverage or is or becomes insolvent.

II.   Standard of Review

        We review a grant of summary judgment de novo, using the same standard as
the district court. Jackson v. Ark. Dep’t of Educ., Vocational & Technical Educ. Div.,
272 F.3d 1020, 1025 (8th Cir. 2001). Summary judgment “shall be rendered
forthwith if the pleadings, depositions, answers to interrogatories, and admissions on
file, together with the affidavits, if any, show that there is no genuine issue as to any
material fact and that the moving party is entitled to a judgment as a matter of law.”
Fed. R. Civ. P. 56(c).


                                          -6-
III.   Analysis

       A.    Uninsured Motorists Coverage

      The Murrays make various arguments in support of their contention that the
vehicle Hohnbaum was driving was an uninsured vehicle as defined by their
American Family policies, and that they deserve payment under this coverage. We
take each argument in turn.

             1.     Amount of Coverage

      The Murrays contend that the vehicle Hohnbaum was driving lacked the
minimum level of coverage required in Missouri and was, therefore, an “uninsured
vehicle.” As stated above, the American Family policies defined an “uninsured
vehicle” as a vehicle “insured at the time of the accident by a liability bond or policy
with bodily injury limits below the minimum required by the financial responsibility
law of the state in which your car is principally garaged.” The Murrays principally
garaged their cars in Missouri, and the minimum liability coverage limit required by
Missouri was $25,000. The Murrays contend that the Hohnbaum vehicle was insured
for only $10,000 under Hohnbaum’s automobile insurance policy, and thus the car
was insured at a level below Missouri’s minimum.

      We disagree. In addition to the $10,000 personal liability coverage, the vehicle
was also insured by National Car Rental as a self-insurer. Under Missouri law, a self-
insurer is obligated to insure a vehicle in at least the minimum amounts required by
Missouri law. Mo. Rev. Stat. § 303.160.1(4); Quick v. Nat’l Auto Credit, 65 F.3d
741, 745 (8th Cir. 1995) (“self-insurer must promise to pay the same judgments in the
same amounts as an insurer would be obligated to pay”). Because National Car
Rental was a self-insurer, it was by definition responsible to pay the minimum amount
required by Missouri law, up to $25,000. Because National Car Rental was

                                          -7-
responsible for this amount, the vehicle was not insured below the minimum required
by Missouri.

             2.     Denial of Coverage

       The Murrays next argue that the vehicle Hohnbaum was driving qualifies as an
“uninsured vehicle” because National Car Rental denied coverage. The American
Family policies consider a vehicle “uninsured” if the vehicle is insured, but, “at the
time of the accident . . . the [insuring] company denies coverage.” The Murrays
contend that National Car Rental denied coverage in an April 10, 2001, letter from
a claims representative in which the representative stated:

      National is not accepting primary liability coverage for Ms. Hohnbaum
      for this accident. . . . Ms. Hohnbaum opted to decline liability
      protection through National Car Rental. . . . We have confirmed that Ms.
      Hohnbaum does have liability coverage for this accident, and therefore,
      National does not have coverage.

In this letter, National Car Rental said that it was not the primary insurer of the
vehicle. National Car Rental claimed that Ms. Hohnbaum’s personal liability
insurance company was primarily responsible, while National Car Rental’s
responsibility was secondary. In the letter, National Car Rental also stated that it was
a self-insurer. When read as a whole, the purpose of the letter is clear: National Car
Rental was refusing primary liability coverage for the vehicle, not denying coverage
in total. Consistent with this position, National Car Rental subsequently offered a
$15,000 settlement to the Murrays, which they refused.

             3.     Insolvency

      The Murrays also contend that the vehicle at issue was an “uninsured vehicle”
because National Car Rental became insolvent within two years of the accident. The


                                          -8-
American Family policies state that when an insurer “becomes insolvent within two
years from the date of the accident” the vehicle qualifies as an uninsured vehicle. The
Murrays assert that because National Car Rental filed for bankruptcy within two years
of the accident, it was insolvent and the vehicle was uninsured.

       We find this argument unpersuasive. The evidence shows that National Car
Rental’s assets were greater than its liabilities at the time it filed bankruptcy and that
National Car Rental was able to pay its debts as they became due. Thus, under at
least two definitions of “insolvent,” National Car Rental did not qualify. See Mo.
Rev. Stat. §400.1-201(23) (“A person is ‘insolvent’ who either has ceased to pay his
or her debts in the ordinary course of business or cannot pay his or her debts as they
become due or is insolvent within the meaning of the federal bankruptcy law.”); 11
U.S.C. §101 (32)(A) (an entity is “insolvent” according to the U.S. Bankruptcy Code
when its debts are greater than the value of the entity’s property at fair value).

       Further, National Car Rental made a $15,000 settlement offer before declaring
bankruptcy. We have trouble determining the relevance of the bankruptcy because,
if the Murrays had accepted the offer, the matter could have been settled before
National Car Rental declared bankruptcy. The bankruptcy court approved the
$15,000 payment during the bankruptcy proceedings, so the bankruptcy had no effect
on the money the Murrays could have received.

             4.     Public Policy

      Because we find that the vehicle at issue was not an “uninsured vehicle” under
the American Family policies’ definitions, we need not address the Murrays’
argument that the clause which omits self-insured vehicles from the definition of an
“uninsured vehicle” is void as against public policy. Even if this clause were stricken,
the Murrays would still not be entitled to coverage under this provision.



                                           -9-
      B.     Underinsured Motorists Coverage

      As stated earlier, the American Family policies that included underinsured
motorist coverage defined an underinsured vehicle as “a motor vehicle which is
insured by the liability bond or policy at the time of the accident which provides
bodily injury liability limits less than the limits of the liability of this underinsured
motorists coverage.” In this case, the vehicle was insured for a maximum of $25,000.
The amount of the underinsured motorist coverage was $100,000 per person and
$300,000 per accident.

        The policies also state that an “[u]nderinsured motor vehicle, however, does
not mean a vehicle . . . [o]wned or operated by a self-insurer as considered by any
financial responsibility law, motor carrier law, or similar law.” The vehicle
Hohnbaum was driving was owned by National Car Rental, a certified self-insurer in
the state of Missouri. The vehicle was also insured at limits less than the limits of
liability under the Murrays’ underinsured motorist policies. The Murrays argue that
since the vehicle Hohnbaum was driving fits both the description of a vehicle that is
underinsured and the description of a vehicle that is not underinsured, the policy is
ambiguous. We also note that, in this case, the car was underinsured by Hohnbaum’s
personal insurance company in addition to being owned by a self-insurer, a situation
not contemplated by the policies’ definitions.

      “When interpreting an insurance policy, this court is to give the policy a
reasonable construction and interpret the policy ‘so as to afford rather than defeat
coverage.’” JAM Inc. v. Nautilus Ins. Co., 128 S.W.3d 879, 893 (Mo. Ct. App. 2004)
(quoting Farm Bureau Town & Country Ins. of Mo. v. Hilderbrand, 926 S.W.2d 944,
947 (Mo. Ct. App. 1996)). “If a contract promises something in one point and takes
it away in another, there is a resultant ambiguity, and any ambiguity or doubt as to
meaning is construed against the insurance company.” Macon v. Farmers Ins. Co.,
791 S.W.2d 437, 438 (Mo. Ct. App. 1990) (internal citation omitted). “Policy

                                          -10-
provisions designed to restrict, limit or impose exceptions or exemptions on insurance
coverage will be strictly construed against the insurer.” Farm Bureau, 926 S.W.2d
at 947.

       The court below ultimately declined to determine whether the Murrays should
collect under the underinsured motorist provisions of their policies because it found
the Murrays failed to meet a prerequisite of coverage by declining the $15,000 offer
from National Car Rental. The Murrays argue that this finding should have been
precluded by a stipulation between the parties that “[p]laintiffs have performed and
complied with all terms precedent concerning their American Family insurance
policies as related to their claims against American Family and the judgment against
Linda Hohnbaum.” American Family has not refuted this contention on appeal.
Accordingly, we will address whether the Murrays can collect under their
underinsured motorist policies.

      The Magistrate Judge below seemed to agree with the Murrays’ arguments that
the ambiguity in the policy as it relates to underinsured motorists requires American
Family to provide coverage. The court stated:

      The Court believes that the Murrays present a compelling argument in
      favor of a fatal ambiguity—it simply makes no sense to sell insureds
      insurance that provides protection in the event they are involved in an
      accident with an individual with less than $100,000 insurance and then
      turn around and nullify that underinsurance protection simply because
      the other individual is a qualified self-insurer.

We agree with the court below that interpreting the contract to nullify coverage in this
situation would be an unreasonable interpretation. The ambiguity in the policies is
construed in favor of the Murrays, and underinsured motorist coverage applies.




                                         -11-
      C.     Stacking

      Because this Court finds that the Murrays are entitled to coverage under their
four policies with underinsured motorist provisions, the Court will consider whether
the Murrays are entitled to “stack” the $100,000 of coverage provided by each policy.
Although the Magistrate Judge below did not reach this issue, it was raised in
Appellants’ Motion for Summary Judgment and is an issue of law that this Court has
the power to decide. See Hawkeye Nat’l Life Ins. Co. v. Avis Indus. Corp., 122 F.3d
490, 496 (8th Cir. 1997).

       Although American Family argues that a UIM endorsement attached to the four
policies prevents stacking, the Murrays contend that this provision is rendered
ambiguous by another part of the policy and thus must be construed against the
insurer to allow stacking.

      The “Limits of Liability” portion of the UIM endorsement states:

      We will pay no more than these maximums no matter how many
      vehicles are described in the declarations, insured persons, claims,
      claimants or policies or vehicles are involved in the accident.

The provision allegedly rendering the above provision ambiguous is found in the
“Other Insurance” clause in the policy:

      If there is other similar insurance on a loss covered by this endorsement,
      we will pay our share according to this policy’s portion of the total
      limits of all similar insurance. But, any insurance provided under this
      endorsement for an insured person while occupying a vehicle you do not
      own is excess over any other similar insurance.

      The Missouri Court of Appeals has considered an American Family policy with
similar provisions. Clark v. Am. Family Mut. Ins. Co., 92 S.W.3d 198 (Mo. Ct. App.

                                        -12-
2002). It found that the provisions created an ambiguity and thus allowed stacking.3
Id. at 203-05. Although Clark is persuasive authority, we are not bound by it for two
reasons. Lancaster v. Am. and Foreign Ins. Co., 272 F.3d 1059, 1062 (8th Cir. 2001)
(“We are not bound by decisions of intermediate appellate courts, although they do
provide persuasive authority, and we follow them when they are the best evidence of
state law.”). First, it is not certain that the Missouri Supreme Court would have ruled
the same way as the appellate court on the specific facts of Clark. Second, we need
not determine whether an insurance policy is ambiguous based solely on the two
provisions contrasted in Clark because the Murrays’ policies contain an additional
provision that clarifies American Family’s total liability.

      Part VI of the policy, titled General Provisions, states:

      Two or More Cars Insured. The total limit of our liability under all
      policies issued to you by us shall not exceed the highest limit of
      liability under any one policy.4

The Illinois Court of Appeals reviewed American Family policies that contained
such a provision and found:




      3
          The exact language of the “other insurance” provision in Clark is:

               In the event there is other like or similar insurance applicable to
               a loss covered by this endorsement, this company shall not be
               liable for more than the proportion which this endorsement bears
               to the total of all applicable limits. However, any insurance
               provided under this endorsement for a person insured while
               occupying a non-owned vehicle is excess of any other similar
               insurance.
      4
       If the policy at issue in Clark contained a similar “multiple cars” provision it
was not addressed by the Court.

                                          -13-
      The “two or more cars insured” provision clearly covers
      situations where two or more cars belonging to the same insured
      are covered by policies issued by [the insurance company]. It
      unambiguously provides that in that case [the insurance
      company]’s total liability will not exceed the highest liability
      under any one policy. Read in this context, the other insurance
      clause refers only to a situation where a different policy issued by
      a different company applies. If this provision were intended to
      refer to other policies issued by [the insurance company], there
      would be no need to refer to a proportionate share; the [insurance
      company]’s proportionate share would always be 100%.
      Moreover, reading the other insurance clause in this manner
      would render the anti-stacking provision meaningless. The other
      insurance clause would always “trump” the antistacking provision
      rendering it nugatory. Each clause applies to a different situation,
      and the antistacking clause is simply not ambiguous.

Am. Family Mut. Ins. Co. v. Martin, 728 N.E.2d 115, 118 (Ill. Ct. App. 2000).

       The Martin Court’s interpretation of the policy is consistent with the principle
that “construction or interpretation of an insurance policy which entirely neutralizes
one provision should not be adopted if the contract is susceptible [to] another
construction which gives effect to all its provisions and is consistent with the general
intent.” Dent Phelps R-III School Dist. v. Hartford Fire Ins. Co., 870 S.W.2d 915, 920
(Mo. Ct. App. 1994).

      We find that even if the “Other Insurance” provision could be deemed
ambiguous on its own, its meaning is clear when considered in combination with the
separate section titled “Limits of Liability” and the general provision describing the
impact of having two or more cars covered by American Family policies.
Accordingly, we find that the limitations on liability are enforceable and that the
Murrays may not stack the underinsured motorist coverage of multiple policies.



                                         -14-
      D.     Other Claims

      The Murrays also brought breach of contract and failure to procure insurance
claims, arguing they had been verbally advised by American Family’s agents that
their umbrella policy provided uninsured motorist and underinsured motorist
coverage. The Magistrate Judge dismissed these claims, finding that even if the
umbrella policy had contained such endorsements the Murrays would not be entitled
to coverage because Hohnbaum was not an uninsured motorist and because the
Murrays failed to meet the prerequisites for an underinsured motorist claim.

      Because we find that the Murrays are entitled to underinsured motorist
coverage for the reasons discussed in Part B, and because the grant of summary
judgment on the claims for breach of contract and failure to procure insurance was
explicitly based on the assumption that the Murrays were ineligible for such
coverage, we also reverse the grant of summary judgment on the claims for breach of
contract and failure to procure insurance. We offer no opinion on the merits of these
two claims or the defenses asserted by American Family.

IV.   Conclusion

      For the foregoing reasons, we affirm the finding of the lower court regarding
the uninsured motorist coverage, but reverse the finding regarding the underinsured
motorist coverage. We find that the Murrays are entitled to recovery under the
underinsured motorist coverage and that stacking does not apply. We further reverse
the grant of summary judgment on the breach of contract and failure to procure
insurance claims.
                       ______________________________




                                        -15-
