INSURANCE-FINANCIAL RESPONSIBILITY LAW-UIM-EXCLUSIONS-REGULAR USE EXCLUSION

September 16th, 2022 by Rieders Travis in Insurance

Jones v. Erie Ins. Exch., 2022 Pa. Super. LEXIS 379 (Pa. Super. September 7, 2022) (Murray, J.)  Trial court granted Erie’s motion for judgment on the pleadings on UIM claim based on regular use exclusion.  Appeal followed.  The question here is whether the “regular use” exclusion may not be enforced because to do so would conflict with the court’s decision in Rush v. Erie Insurance Exchange, 265 A.3d 794 (Pa. Super. 2021), and whether the “regular use” exclusion may not be enforced because it operates to limit the scope of underinsurance motorist coverage required by the law, and finally, whether the “regular use” exclusion is unenforceable because it is contrary to public policy.  Erie argues that Rush is contrary to Pennsylvania Supreme Court authority.  The Court found that the lower court erred in granting Erie’s motion for judgment on the pleadings.  Its right to succeed was not certain.  The case was reversed.  As was stated in the federal case, because the Superior Court and Rush held that the regular use clause of an insurance contract contravenes § 1731 of the Motor Vehicle Financial Responsibility Law, the court is bound by…

INSURANCE-MARINE INSURANCE-COVERAGE

September 14th, 2022 by Rieders Travis in Insurance

Great Lakes Ins. SE v. Raiders Retreat Realty Co., LLC, 2022 U.S. App. LEXIS 24409 (3rd Cir. August 30, 2022) (Ambro, C.J.)  A yacht owned by Raiders Retreat Realty Co., LLC ran aground. Raiders had insured the vessel with marine insurer Great Lakes Insurance SE ("GLI"). But after Raiders submitted a claim under its policy, GLI left it high and dry. The insurer's reason for denying coverage: the yacht's fire-extinguishing equipment had not been timely recertified or inspected notwithstanding that the vessel's damage was not caused by fire. GLI sued first, seeking in federal court a declaratory judgment that Raiders' alleged failure to recertify or inspect its fire-suppression equipment rendered the policy void from its inception.  A lawsuit was brought under Pennsylvania law for breach of fiduciary duty, insurance bad faith, and Pennsylvania’s Unfair Trade Practices and Consumer Protection Law.  The question is whether New York or Pennsylvania law applies.  After a lengthy discussion, the court determined that the district court needs to consider whether Pennsylvania has a strong public policy that would be thwarted by applying New York law.  The court thus vacated and remanded for further proceedings as…

INSURANCE-FINANCIAL RESPONSIBILITY LAW-INDEMNITY-FIRST PARTY BENEFITS

September 2nd, 2022 by Rieders Travis in Insurance

State Farm Mut. Auto. Ins. v. Kelsea Griffiths & Elec. Ins. Co., 2022 U.S. Dist. LEXIS 150782 (W.D. Pa. August 23, 2022) (Baxter, D.J.)  This action arises from an underlying tort action that was filed in the Court of Common Pleas of Erie County, Pennsylvania ("Erie County Court") by Kelsea Griffiths ("Griffiths") against Andrea Schlaufman ("Schlaufman") to recover damages for injuries Griffiths sustained in an automobile accident that occurred on August 22, 2014. At the time of the accident, Griffiths was a passenger in a vehicle operated by Heather Bendure ("Bendure"). According to Griffiths, the accident was negligently caused by a second vehicle that was operated by Schlaufman, who fled the scene. Griffiths subsequently joined Bendure as an additional defendant in the underlying action. At the time of the accident, Schlaufman was insured under an automobile insurance policy that provided bodily injury liability ("BI") coverage limits of $100,000.00. Bendure was insured under an automobile insurance policy with Electric that provided BI coverage limits of $50,000.00 and underinsured motorist ("UIM") coverage limits of $50,000.00. Griffiths was insured under two policies of automobile insurance issued by State Farm that provided stacked UIM…

INSURANCE-FINANCIAL RESPONSIBILITY LAW-FIRST PARTY BENEFITS-UNLICENSED DRIVER EXCLUSION

August 22nd, 2022 by Rieders Travis in Insurance

Nationwide Prop. & Cas. Ins. Co. v. Castaneda, 2022 Pa. Dist. & Cnty. Dec. LEXIS 936 (C.P. Dauphin July 14, 2022) (McNally, J.)  In this matter, the Automobile Insurer seeks that this Court grant judgment in its favor and issue a decree finding that it is not obligated, under an Automobile Policy issued to its Policyholder, to provide first party medical benefits to the Policyholder's daughter because she was an unlicensed driver driving her mother's vehicle at the time of the accident. The Driver, who has filed a counterclaim on her own behalf and on behalf of a putative class of similarly situated drivers, seeks partial summary judgment declaring that the Insurer's denial of first party medical benefits under the Policy's "Unlicensed Driver Exclusion" is void as against public policy. The Driver additionally seeks, on her own behalf and on behalf of the putative class, compensatory relief in the form of first party benefits, interest, attorneys' fees, costs and treble damages. For the reasons set forth below, this Court finds that the Insurer is not obligated to pay first party medical benefits to the Driver and thus grants judgment in…

NSURANCE-FINANCIAL RESPONSIBILITY LAW-WAIVER-UIM REJECTION

August 15th, 2022 by Rieders Travis in Insurance

Koch v. Progressive Direct Ins. Co., 2022 Pa. Super. LEXIS 327 (August 4, 2022) (Stevens, P.J.E.)  Progressive Direct Insurance Company ("Progressive Direct") appeals the order entered by the Court of * Former Justice specially assigned to the Superior Court. Common Pleas of Berks County denying its motion for summary judgment and granting the cross motion for summary judgment filed by Appellee Bryan D. Koch, in his capacity as Executor of the Estate of Rhea Lynn Koch and in his own right. After careful review, we reverse the trial court's order. On June 7, 2015, Bryan Koch ("Koch") was driving his 2013 Harley Davidson motorcycle while his wife, Rhea Lynn Koch ("Mrs. Koch") was riding with him as a passenger. Their motorcycle was struck by a 1997 Ford Explorer driven by Sean Eyrick, who was later determined to be driving under the influence of alcohol when the accident occurred. Mrs. Koch was killed in the accident and Koch suffered injuries that required the amputation of his left leg above his knee. The parties do not dispute that Eyrick was solely at fault for causing the accident. Ultimately, Koch decided to settle…

INSURANCE-FINANCIAL RESPONSIBILITY LAW-UM/UIM COVERAGE-STACKING-MOTORCYCLES

July 11th, 2022 by Rieders Travis in Insurance

Ford v. Progressive Specialty Ins. Co., 2022 U.S. Dist. LEXIS 36389 (E.D. Pa. March 2, 2022) (Slomsky, J.)  In this case, Plaintiff Michael Ford ("Plaintiff') was driving his motorcycle and collided with an underinsured vehicle. He received the $15,000 in liability coverage from the insurance company insuring the underinsured vehicle. Plaintiff also had two of his own insurance policies: one at Progressive Preferred Insurance Company covering his motorcycle and another at a different insurance company, Defendant Progressive Specialty Insurance Company ("Defendant"). Two other vehicles were insured by Defendant. The company insuring the motorcycle paid the full amount of coverage, $25,000. However, Defendant declined to pay any underinsured benefits, claiming that Plaintiff waived inter-policy stacking under 75 Pa. C.S. § 1738(d) by signing the waiver. Thereafter, Plaintiff, on behalf of himself and putative class members, commenced this action, seeking a declaratory judgment in Count I and asserting a claim for breach of contract in Count II against Defendant for breaching the insurance policy by not paying the stacked coverage under its insurance policy. Given the Donovan holding, the parties agree in this case that the facts here are similar to those in Donovan and that Donovan would ordinarily apply and resolve…

INSURANCE-FINANCIAL RESPONSIBILITY LAW-UNDERINSURANCE-WAIVER-POLICY YEAR

May 13th, 2022 by Rieders Travis in Insurance

Hartford Fire Ins. Co. v. Davis, 2022 Pa. Super. LEXIS 200 (May 9, 2022) (Stevens, P.J.E.)  The trial court held that Keystone effectively waived UIM coverage in Pennsylvania by executing a "Rejection of UIM Protection" form in 2003. The trial court found that this form: (a) was applicable to the 2005- 2006 policy, despite the fact that a new rejection form was never obtained for the 2005-2006 policy term; and (b) fully complied with Section 1731 of the Pennsylvania Motor Vehicle Financial Responsibility Law, 75 Pa.C.S.A. §§ 1701-1799.7. Appellant argues that the trial court erred in finding that the 2005-2006 policy issued by Hartford did not provide for UIM coverage at the time of his automobile accident, despite the fact that a UIM Coverage Endorsement was appended to thereto. Appellant also contends that the trial court erred in concluding that the "Rejection of UIM Protection" form executed by Keystone in 2003 was applicable to the 2005-2006 policy term. Following our careful review, we agree. Here, the record reflects that the policy at issue expressly provided for UIM coverage at the time of Appellant's September 9, 2005 accident. It is undisputed…

Insurance

July 23rd, 2019 by Rieders Travis in Insurance

MISREPRESENTATION-PHARMACIES-INSURANCE FRAUD Liberty Mutual Group, Inc. v. 700 Pharmacy, LLC, 2022 Pa. Super. 19, No. 3357 EDA 2019 (February 1, 2022) (Nichols, J.).  Case brought by insurance companies against pharmacies.  The claim was for fraud, insurance fraud, aiding and abetting and unjust enrichment.  Appellants claimed that pharmacies created an unlawful business structure under which doctors prescribed topical compound pain creams to patients who had been injured at work or in automobile accidents.  The patients then filled the prescriptions at pharmacies in which the doctors had a financial interest.  Appellees alleged that the compound pain creams were formulated by the pharmacies for the sole purpose of generating a profit and that the doctors were receiving unlawful kickbacks. The matter was dismissed, in that no misrepresentation, fraud or other claim was shown. INSURANCE-FINANCIAL RESPONSIBILITY LAW-UIM BENEFITS-WAIVER-RESIDENT RELATIVE-RETROACTIVITY Ford v. Progressive Specialty Ins. Co., 2022 U.S. Dist. LEXIS 36389 (E.D. Pa. March 2, 2022) (Slomsky, J.).  In Donovan v. State Farm, a decision by the Pennsylvania Supreme Court, Donovan suffered significant injuries during a collision of his motorcycle with an underinsured vehicle. 256 A.3d 1145, 1147 (Pa. 2021). He initially filed liability claims…

INSURANCE-BAD FAITH-ATTORNEY’S FEES

October 10th, 2018 by Rieders Travis in Insurance

Bernie Clemens, Nicole Clemens v. New York Central Mutual Fire Insurance Company, and/or NYCM Insurance Group and/or NYCM Holdings, Inc., 3d Cir. 2018 (Greenaway, Jr., J.  After a jury awarded him $100,000 in punitive damages under the Pennsylvania Bad Faith Statute, 42 Pa. Cons. Stat. § 8371, Appellant Bernie Clemens submitted a petition for over $900,000 in attorney’s fees from Appellee New York Central Mutual Fire Insurance Company (“NYCM”). The District Court denied this petition in its entirety, reasoning that it was not adequately supported and that the requested amount was grossly excessive given the nature of the case. Finding no abuse of discretion, we will affirm and, in doing so, take the opportunity to formally endorse a view already adopted by several other circuits – that is, where a fee-shifting statute provides a court discretion to award attorney’s fees, such discretion includes the ability to deny a fee request altogether when, under the circumstances, the amount requested is “outrageously excessive.” Brown v. Stackler, 612 F.2d 1057, 1059 (7th Cir. 1980); see also, e.g., Envtl. Def. Fund, Inc. v. Reilly, 1 F.3d 1254, 1258-60 (D.C. Cir. 1993); Fair Hous. Council…

INSURANCE-DEFENSE, DUTY TO PROVIDE-FOUR CORNERS RULE-EXCEPTIONS

September 28th, 2018 by Rieders Travis in Insurance

Insurer's Duty to Defence and Exceptions to the "Four Corners" Rule Lupu v. Loan City, LLC, Nos. 17-1944 & 17-2024 (3d Cir. September 10, 2018) Ambro, C.J.  What is the duty of a real estate title insurer in Pennsylvania to defend the insured party (here the successor to a lender) against claims of the borrower/mortgagor? Its courts, we predict, would not apply the “in for one, in for all” rule (known also as the complete defense rule)1—whereby a single covered claim triggers an obligation for the title insurer to defend the entire action—to a case about that insurer’s duty to defend. To identify a covered claim, we apply Pennsylvania’s rule that potentially covered claims are identified by “comparing the four corners of the insurance contract to the four corners of the complaint.” American & Foreign Ins. Co. v. Jerry’s Sport Center, Inc., 2 A.3d 526, 541 (Pa. 2010). The insured in its briefing used the latter term. As both the District Court and the title insurer refer to the rule by its more colloquial name, we do as well.  Although the Pennsylvania Supreme Court was invited to make an exception…