Appeals court asked to decide whether UIM insurer must cover prejudgment interest beyond policy limits

Jim Grumbach, appealing for the plaintiff, said State Farm’s UIM policy language is ambiguous with respect to interest and costs and that New Hampshire statute RSA 524-B (as argued) supports awarding prejudgment interest despite a policy limit. Grumbach urged that the phrase "regardless of the amount of any award" should not be read to exclude statutory interest and that ambiguity should be resolved for the insured.

State Farm counsel Bridget Lopez said the insured purchased a finite limit and that the policy's 'regardless' clause forecloses paying in excess of the available limits; she argued National Grange and Metropolitan lines of New Hampshire appellate decisions limit recovery of prejudgment interest against a UIM insurer. The panel debated whether the policy’s silence about interest in the underinsured section creates ambiguity and whether the New Hampshire statute compels interest payments in this context.

Why it matters: The decision will determine whether an underinsured-motorist insurer must pay statutory prejudgment interest and costs in addition to policy limits — a question that affects the net recovery for many injured motorists and the economics of selecting UIM coverage.

Next steps: The court took the case under advisement.