The following is text from this UM endorsement.

2. The applicable limit of liability for this coverage.

In order to avoid insurance benefits payments in excess of actual damages sustained, subject only to the limits set out in the Schedule or in the Declarations and other applicable provisions of this coverage, we will pay all covered damages not paid or payable under any workers' compensation law, disability benefits law, any similar law, auto medical expense coverage or Personal Injury Protection Coverage.

Texas Subscriber

Your question involves several issues.

In Texas, as in many states, being a qualified self-insurer for workers compensation equates with buying workers compensation insurance from an insurance company. It is simply a method by which a Texas employer may finance its statutory workers compensation exposure. Therefore, a qualified self-insurer for workers compensation in Texas holds the same position as a workers compensation insurer.

Texas permits workers compensation insurers to be reimbursed from proceeds of a third-party settlement with the injured employee. This is stated in the Texas labor code V.T.C.A., Labor Code sections 417.001 and 417.002.

In Argonaut Ins. Co. v. Baker, 87 S.W.3d 526 (Texas 2002), a workers compensation insurer subrogated against the negligent driver of a vehicle. The driver was liable for injuries sustained by an individual who was injured during the course of employment and who received workers compensation benefits as a result of the accident. The subrogation was permitted despite the fact that the workers compensation policy included a large deductible. However, this case did not involve uninsured/underinsured motorist coverage but, rather, spoke to a large deductible workers compensation plan and a negligent driver.

The UM coverage on the policy you reference does exclude payments that “directly or indirectly” benefit any insurer or self-insurer for workers compensation. This would preclude payment under the UM portion of the policy for the subrogation.

The UM policy does permit payments that are in excess of workers compensation payments made to the injured employee. Payments that duplicate those collected under workers compensation are not recoverable.

The legalities of this situation are beyond the scope of our service, and we cannot comment on whether the workers compensation self-insurer can be legally stopped from trying to subrogate just because the UM policy excludes payments that would benefit the self-insurer. However, as far as insurance is concerned, the UM policy excludes payments that would directly or indirectly benefit the workers compensation self-insured. So direct subrogation against proceeds from the policy would not seem viable. The injured employee, however, would be able to claim excess payments (above those received from workers compensation) for such damages as pain and suffering from the UM insurer.