Rose v. American Family Ins. Co.

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Nebraska Supreme Court Advance Sheets
315 Nebraska Reports
ROSE v. AMERICAN FAMILY INS. CO.
Cite as 315 Neb. 302
Teresa Rose, appellant, v. American Family
Insurance Company, appellee.
___ N.W.2d ___
Filed October 6, 2023. 	No. S-22-898.
1. Summary Judgment: Appeal and Error. An appellate court affirms a
lower court’s grant of summary judgment if the pleadings and admitted
evidence show that there is no genuine issue as to any material facts or
as to the ultimate inferences that may be drawn from the facts and that
the moving party is entitled to judgment as a matter of law.
2. ____: ____. An appellate court reviews the district court’s grant of sum-
mary judgment de novo, viewing the record in the light most favorable
to the nonmoving party and drawing all reasonable inferences in that
party’s favor.
3. Insurance: Contracts. An insurance policy is a contract between the
insurer and the insured, whose respective rights and obligations must be
determined by contract principles.
4. Jurisdiction: States: Contracts. Persons residing in different states
may select the law of either state to govern their contract, and the par-
ties’ choice of law will ordinarily govern.
Appeal from the District Court for Douglas County: J
Russell Derr, Judge. Affirmed.
Eric R. Chandler, of Chandler Conway, P.C., L.L.O., for
appellant.
Joel D. Nelson, Joel Bacon, and Brenna M. Grasz, of
Keating, O’Gara, Nedved & Peter, P.C., L.L.O., for appellee.
Danny C. Leavitt for amicus curiae Nebraska Association of
Trial Attorneys.
Nebraska Supreme Court Online Library
www.nebraska.gov/apps-courts-epub/
10/14/2026 08:49 AM CDT

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Nebraska Supreme Court Advance Sheets
315 Nebraska Reports
ROSE v. AMERICAN FAMILY INS. CO.
Cite as 315 Neb. 302
Miller-Lerman, 	Cassel, 	Stacy, 	Funke, 	Papik, 	and
Freudenberg, JJ.
Miller-Lerman, J.
NATURE OF CASE
Teresa Rose appeals the order of the district court for
Douglas County made on summary judgment that determined
that her claim for underinsured motorist benefits against
American Family Insurance Company (American Family) was
barred by a 2-year limitation provision in the insurance policy
and dismissed her action. Rose appeals. We determine that the
Iowa choice-of-law provision in this Iowa policy controls and
that under Iowa law, the 2-year contractual limitation period
on actions for underinsured motorist benefits was reasonable
when the contract was made and is enforceable in this case.
Because Rose’s action was untimely, we affirm the order of
the district court that granted summary judgment in favor of
American Family and dismissed the action.
STATEMENT OF FACTS
The Collision.
On February 3, 2018, Rose was injured when the vehicle she
was driving was struck by an underinsured motorist. Rose was
commuting to her workplace in Omaha, Nebraska, from her
home in Carter Lake, Iowa (Carter Lake Residence), where she
lived with her sister, Shauna Bosques.
At the time of the collision, Rose had an Iowa driver’s
license, but did not own a vehicle. The car in which she was
struck was borrowed from her boyfriend, Christopher Stark.
Stark was a Nebraska resident, and the car was licensed and
registered in the State of Nebraska. Stark loaned the car to
Rose approximately every other weekend so that she could
commute to work.
Auto Insurance Claims.
Following the collision, Rose was hospitalized for sev-
eral days. She ultimately settled with the auto insurer for

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Nebraska Supreme Court Advance Sheets
315 Nebraska Reports
ROSE v. AMERICAN FAMILY INS. CO.
Cite as 315 Neb. 302
the at-fault motorist for the liability limit of $25,000 and
settled with Stark’s auto insurer for the underinsured limit of
$25,000. Rose claimed underinsured motorist benefits under
an American Family auto insurance policy (Policy) issued to
Rose’s sister, Bosques. This appeal arises from Rose’s claim
for underinsured motorist benefits against the Policy.
The Policy extended coverage to certain relatives of Bosques.
The Carter Lake Residence was owned by the father of Rose
and Bosques. The Policy was issued in Iowa. It contained a
“Choice of Law” provision that stated: “Any disputes as to
the coverage provided or the provisions of this policy will be
governed by the laws of the state shown in the Declarations
as your residence.” The residence in the declarations showed
the Iowa address of the Carter Lake Residence. The declara-
tion showed one named vehicle, a Kia, which was “garaged”
at the Carter Lake Residence. The parties do not dispute that
the Kia was not involved in the collision.
On November 15, 2019, American Family determined that
Rose had been fully compensated by her prior settlements and
denied her claim for underinsured motorist benefits.
Lawsuit Against American Family.
Rose sued American Family in the district court for Douglas
County, Nebraska, on September 3, 2020. American Family
moved for summary judgment based on a limitations of action
provision in the Policy regarding underinsured motorist cover-
age that stated “any suit against [American Family] will be
barred unless commenced within two years from the date of
the accident.” American Family asserted that Iowa law applied
to the Policy and that the 2-year contractual limitation in the
Policy barred Rose’s action.
District Court Order.
The district court determined, inter alia, that Iowa courts
have expressed a strong public policy in favor of freedom
of contract and have specifically enforced an underinsured
motorist policy that contained a 2-year limitation on actions.

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Nebraska Supreme Court Advance Sheets
315 Nebraska Reports
ROSE v. AMERICAN FAMILY INS. CO.
Cite as 315 Neb. 302
The district court concluded that under Iowa law, Rose’s claim
was time barred. The district court granted American Family’s
motion for summary judgment and dismissed the action.
Rose appeals.
ASSIGNMENT OF ERROR
Rose claims, summarized and restated, that the district court
erred when it determined that her action was time barred under
the 2-year limitation period in the Policy, granted summary
judgment to American Family, and dismissed her action.
STANDARDS OF REVIEW
[1,2] An appellate court affirms a lower court’s grant of
summary judgment if the pleadings and admitted evidence
show that there is no genuine issue as to any material facts or
as to the ultimate inferences that may be drawn from the facts
and that the moving party is entitled to judgment as a matter
of law. Schuemann v. Timperley, 314 Neb. 298, 989 N.W.2d
921 (2023). An appellate court reviews the district court’s
grant of summary judgment de novo, viewing the record in the
light most favorable to the nonmoving party and drawing all
reasonable inferences in that party’s favor. Id.
The interpretation of a contract and whether the contract is
ambiguous are questions of law subject to independent review.
Brush & Co. v. W. O. Zangger & Son, 314 Neb. 509, 991
N.W.2d 294 (2023).
An appellate court reviews questions of law independently
of the lower court’s conclusion. See Bruce Lavalleur, P.C. v.
Guarantee Group, 314 Neb. 698, 992 N.W.2d 736 (2023).
ANALYSIS
The district court determined that, under the terms of the
Policy, 	Rose’s 	action 	for 	underinsured 	benefits 	was 	time
barred and, accordingly, granted summary judgment in favor
of American Family and dismissed the action. Rose appeals,
asserting a variety of theories.

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Nebraska Supreme Court Advance Sheets
315 Nebraska Reports
ROSE v. AMERICAN FAMILY INS. CO.
Cite as 315 Neb. 302
American Family argues, inter alia, that the parties to the
Policy chose to be governed by Iowa law, that the 2-year
limitation provision was reasonable in Iowa when the Policy
was made, and that we may enforce it. We agree with
American Family.
A Claim for Underinsured Motorist Benefits Under
an Insurance Policy Arises out of a Contract.
[3] Among her variety of rationales, Rose contends that
because this matter flowed from an auto accident, Nebraska’s
4-year statute of limitations for torts, Neb. Rev. Stat. § 25-207
(Reissue 2016), controls the outcome of this case. We do not
agree. An insurance policy is a contract between the insurer
and the insured, whose respective rights and obligations must
be determined by contract principles. Johnson v. United States
Fidelity & Guar. Co., 269 Neb. 731, 696 N.W.2d 431 (2005).
An insurance policy must be construed as any other contract to
give effect to the parties’ intentions at the time the contract was
made. See North Star Mut. Ins. Co. v. Miller, 311 Neb. 941,
977 N.W.2d 195 (2022).
We also note that because Rose was a relative residing in
Bosques’ household, we assume without deciding that Rose is
an “insured person” as defined under the Policy, and we pro-
ceed with our coverage analysis accordingly.
Contractual Choice‑of‑Law Provision Effectively
Selected Iowa Law to Govern the Policy.
The Policy contains a contractual choice-of-law provision.
Under the “Choice of Law” section, the Policy provided that
“[a]ny disputes as to the coverage provided or the provisions
of this policy will be governed by the laws of the state shown
in the Declarations as your residence.” (Emphasis omitted.)
The declarations page listed Bosques’ Carter Lake Residence
in Iowa as the residence. The Policy therefore anticipates
application of Iowa law.
[4] We have recognized that persons residing in differ-
ent states may select the law of either state to govern their

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Nebraska Supreme Court Advance Sheets
315 Nebraska Reports
ROSE v. AMERICAN FAMILY INS. CO.
Cite as 315 Neb. 302
contract and that the parties’ choice of law will ordinarily
govern. See American Nat. Bank v. Medved, 281 Neb. 799,
801 N.W.2d 230 (2011). When considering whether a con-
tractual choice-of-law provision is determinative, we have
adopted Restatement (Second) of Conflict of Laws § 187(1)
at 561 (1971), which provides, in relevant part: “The law of
the state chosen by the parties to govern their contractual
rights and duties will be applied if the particular issue is one
which the parties could have resolved by an explicit provision
in their agreement directed to that issue.” See, American Nat.
Bank v. Medved, supra; Johnson v. United States Fidelity &
Guar. Co., supra.
Thus, the express choice-of-law provision in the Policy
applies to the 2-year contractual limitation period if the provi-
sion is permitted under Iowa law.
A Contractual Limitations Period
Is Permitted Under Iowa Law.
The contractual choice of law in the Policy prevails if the
particular issue is one that the parties could have resolved by
explicit provision in their agreement, as informed by the local
law of the state selected. Restatement, supra, § 187, comment
c., illustration 4 at 563. As explained below, we determine
that Iowa law as selected by the parties permits the parties to
the Policy to contract for a 2-year limitation period on legal
actions for underinsured motorist benefits.
Under Iowa statutes, a breach of contract claim for under-
insured motorist benefits is subject to the 10-year statute
of limitations for written contracts. See Iowa Code Ann.
§ 614.1(5) (West 2018). See, also, Robinson v. Allied Property
and Cas. Ins., 816 N.W.2d 398 (Iowa 2012). Importantly,
however, Iowa law recognizes the rights of insurers to limit
time for claims, “‘irrespective of a legislative imprimatur
on such provisions.’” Robinson v. Allied Property and Cas.
Ins., 816 N.W.2d at 402. Iowa courts have held that “[t]o
declare a contractual deadline for [uninsured motorist] or

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Nebraska Supreme Court Advance Sheets
315 Nebraska Reports
ROSE v. AMERICAN FAMILY INS. CO.
Cite as 315 Neb. 302
[underinsured motorist] claims unenforceable ‘is an extraor-
dinary remedy, and we find it unpalatable.’” Id. at 408 (quot-
ing Vansickle v. Country Mut. Ins. Co., 272 Ill. App. 3d 841,
651 N.E.2d 706, 209 Ill. Dec. 528 (1995)). Consistent with
the pronouncement quoted above, Iowa courts have explic-
itly held that some 2-year limitation clauses for uninsured
or underinsured motorist disputes are valid and enforceable.
See, Osmic v. Nationwide Agribusiness Ins. Co., 841 N.W.2d
853 (Iowa 2014); Robinson v. Allied Property and Cas. Ins.,
supra; Douglass v. American Family Mut. Ins. Co., 508
N.W.2d 665 (Iowa 1993), overruled on other grounds, Hamm
v. Allied Mut. Ins. Co., 612 N.W.2d 775 (Iowa 2000).
In considering the propriety of the 2-year limitation period,
the Supreme Court of Iowa has stated that a contractual
deadline for legal actions must allow the insured a reason-
able period to sue for the policy benefits. See Robinson v.
Allied Property and Cas. Ins., supra. Whether a contrac-
tual limitations period is “‘reasonable’” is determined at
the time the contract is entered. Id. at 404 n.1 (quoting 1A
Arthur Linton Corbin, Corbin on Contracts § 218 (1963)).
Iowa courts have enforced the 2-year deadline even though
the insured was not aware that the tort-feasors were judg-
ment proof until after the 2 years had passed. See, Osmic v.
Nationwide Agribusiness Ins. Co., supra; Robinson v. Allied
Property and Cas. Ins., supra.
Like the plaintiff in Robinson, Rose argues that applica-
tion of the limitations provision in the Policy is unreasonable
under the circumstances of this case. But we observe that the
court in Robinson declined to invalidate a 2-year contractual
underinsured motorist deadline on similar grounds now urged
by Rose, to the effect that the insured did not reasonably dis-
cover the full extent of damages until later.
Under the law of Iowa at the time the Policy was executed,
the 2-year limitation period in the Policy was reasonable. The
time limitation in the policy did not require Rose to wait to
bring her underinsured motorist suit, and under Iowa law, she

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Nebraska Supreme Court Advance Sheets
315 Nebraska Reports
ROSE v. AMERICAN FAMILY INS. CO.
Cite as 315 Neb. 302
could have pursued her underinsured motorist claim simultane-
ously with her claim against the at-fault motorist. See Robinson
v. Allied Property and Cas. Ins., supra. The limitations provi-
sion is an issue which was resolved through contract, and the
Iowa law approving of the 2-year limitation period for under-
insured actions applies.
Nebraska Law Does Not Prohibit
Contractual Limitations Periods
in Non‑Nebraska Contracts.
Rose refers us to Nebraska’s 5-year statute of limitations
for contracts, Neb. Rev. Stat. § 25-205(1) (Reissue 2016),
and contends that this 5-year limitations period applies and
eclipses the 2-year provision in the Policy. But, see, Neb. Rev.
Stat. § 44-6413(1)(e) (Reissue 2021). She asserts the 2-year
limitation period in this Iowa contract is not enforceable in
Nebraska. We do not agree.
Although 	we 	have 	determined 	that 	contractual 	limita-
tion periods shorter than Nebraska statutory periods are not
enforceable for policies issued in Nebraska, such provisions
will be enforced in Nebraska when they appear in contracts
entered into in other states. See Avondale v. Sovereign Camp,
W. O. W., 134 Neb. 717, 279 N.W. 355 (1938). We have further
concluded that where the provision of the contract of insur-
ance, valid in another state where the contract was entered
into, is a bar to recovery, such provision is required to be
enforced in this state under the full faith and credit clause of
the Constitution of the United States. Young v. Order of United
Commercial Travelers, 142 Neb. 566, 7 N.W.2d 81 (1942). We
have stated that this is so although such provision may be void
under the law of this state. Id.
CONCLUSION
When the policy of insurance contains a choice-of-law pro-
vision and was made in a state that permits such a provision,
the law chosen by the contracting parties governs. The 2-year

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Nebraska Supreme Court Advance Sheets
315 Nebraska Reports
ROSE v. AMERICAN FAMILY INS. CO.
Cite as 315 Neb. 302
limitation period in the Policy, which was issued in Iowa,
controls. Rose’s action was time barred under applicable Iowa
law, and American Family was entitled to summary judgment
and dismissal of the action. Accordingly, we affirm the order
of the district court.
Affirmed.
Heavican, C.J., not participating.
Stacy, J., concurs in the result.