CHAPTER 457

An Act to amend and reenact § $8.1-881, as amended, of the Code of
Virginia, relating to policies or contracts of bodily injury liability
ensurance or of property damage liability insurance. tH 1

311

Approved March 31, 1962

Be it enacted by the General Assembly of Virginia:

1. That § 38.1-381, as amended, of the Code of Virginia be amended
and reenacted as follows:

§ 38.1-381. (a) No policy or contract of bodily injury liability
insurance, or of property damage liability insurance, covering liability
arising from the ownership, maintenance or use of any motor vehicle,
shall be issued or delivered in this State to the owner of such vehicle, or
shall be issued or delivered by any insurer licensed in this State upon any
motor vehicle then principally garaged or principally used in this State,
unless it contains a provision insuring the named insured and any other
person responsible for the use of or using the motor vehicle with the con-
sent, expressed or implied, of the named insured, against liability for
death or injury sustained, or loss or damage occasioned within the cover-
age of the policy or contract as a result of negligence in the operation or
use of such vehicle by the named insured or by any such person; pro-
vided, that every automobile liability insurance policy or contract, or en-
dorsement thereto, insuring private passenger automobiles principally
garaged and/or used in Virginia, when the named insured is an individual
or husband and wife, which includes, with respect to any liability insur-
ance provided by the policy, contract or endorsement for use of a non-
pwned automobile, any provision requiring permission or consent of the
owner of such automobile in order that such insurance apply, shall be
construed to include permission or consent of the custodian in such provi-
310n requiring permission or consent of the owner.

'‘(b) Nor shall any such policy or contract be so issued or delivered
unless it contains an endorsement or provisions undertaking to pay the
nsured all sums which he shall be legally entitled to recover as damages
‘rom the owner or operator of an uninsured motor vehicle, within limits
which shall be no less than the requirements of § 46.1-1(8), as amended
‘rom time to time, of the Code herein. Such endorsement or provisions
shall also provide for no less than five thousand dollars coverage fo
injury to or destruction of the property of the insured in any one acciden
but may provide an exclusion of the first two hundred dollars of sucl
loss or damage.

(c) As used in this section, the term “bodily injury” shall includ:
death resulting therefrom; the term “insured” as used in subsections (b)
(d), (f), and (g) hereof, means the named insured and, while residen
of the same household, the spouse of any such named insured, and rela
tives of either, while in a motor vehicle or otherwise, and any person whe
uses, with the consent, expressed or implied, of the name insured, th
motor vehicle to which the policy applies and a guest in such motor vehicle
to which the policy applies or the personal representative of any of the
above; and the term “uninsured motor vehicle’? means a motor vehicle as
to which there is no (i) bodily injury liability insurance and property
damage liability insurance both in the amounts specified by § 46.1-1(8),
as amended from time to time, or (ii) there is such insurance but the
insurance company writing the same denies coverage thereunder, ‘(ili)
there is no bond or deposit of money or securities in lieu of such bodily
injury and property damage liability insurance and (iv) the owner of
such motor vehicle has not qualified as a self-insurer under the provisions
of § 46.1-395. A motor vehicle shall be deemed to be uninsured if the
owner or operator thereof be unknown; provided that recovery under the
endorsement or provisions shall be subject to the conditions hereinafter
set forth.

(d) If the owner or operator of any motor vehicle which causes
bodily injury or property damage to the insured be unknown, the insured
or someone on his behalf, in order for the insured to recover under the
endorsement, shall report the accident as required by § 46.1-400, unless
such insured is reasonably unable to do so, in which event the insured
shall make such report as soon as reasonably practicable under the cir-
cumstances.

(e) If the owner or operator of any vehicle causing injury or dam-
ages be unknown, an action may be instituted against the unknown
defendant as “John Doe’”’ and service of process may be made by delivery
of a copy of the motion for judgment or other pleadings to the clerk of
the court in which the action is brought and service upon the insurance
company issuing the policy shall be made as prescribed by law as though
such insurance company were a party defendant. The insurance company
shall have the right to file pleadings and take other action allowable by
law in the name of John Doe.

(e) (1) Any insured intending to rely on the coverage required by
paragraph (b) of this section shall, if any action is instituted against the
owner or operator of an uninsured motor vehicle, serve a copy of the
process upon the insurance company issuing the policy in the manner
prescribed by law, as though such insurance company were a party
defendant; such company shall thereafter have the right to file pleadings
and take other action allowable by law in the name of the owner or
operator of the uninsured motor vehicle or in its own name; provided,
however, that nothing in this paragraph shall prevent such owner or
operator from employing counsel of his own choice and taking any action
in his own interest in connection with such proceeding.

This subsection shall not apply to any cause of action arising prior
(O the effective date of this amendment.

(f) Any insurer paying a claim under the endorsement or provisions
required by paragraph (b) of this section shall be subrogated to the rights
of the insured to whom such claim was paid against the person causing
such injury, death or damage to the extent that payment was made;
provided that the bringing of an action against the unknown owner or
operator as John Doe or the conclusion of such an action shall not
constitute a bar to the insured, if the identity of the owner or operator
who caused the injury or damages complained of becomes known, from
bringing an action against the owner or operator theretofore proceeded
against as John Doe, provided that any recovery against such owner or
operator shall be paid to the insurance company to the extent that such
Insurance company paid the named insured in the action brought against
such owner or operator as John Doe, except that such insurance company
shall pay its proportionate part of any reasonable costs and expense
incurred in connection therewith including reasonable attorney’s fees.
Nothing in an endorsement or provisions made under this paragraph nor
any other provision of law shall operate to prevent the joining in an
action against John Doe of the owner or operator of the motor vehicle
causing such injury as a party defendant and such joinder is hereby
specifically authorized.

(g) No such endorsement or provisions shall contain any provision
requiring arbitration of any claim arising under such endorsement or
provisions, nor may anything be required of the insured except the
establishment of legal liability, nor shall the insurer be restricted or
prevented in any manner from employing legal counsel or instituting
legal proceedings.

(h) The provisions of paragraph (a) and (b) of this section shall
not apply to any policy of insurance to the extent that it covers the
liability of an employer under any workmen’s compensation law, but no
provision or application of this section shall be construed to limit the
liability of the insurance company, insuring motor vehicles, to an employee
or ace insured under this section who is injured by an uninsured motor
vehicle.

2. An emergency exists and this act is in force from its passage.