Tuesday, November 19, 2013

Pennsylvania Superior Court Holds that UIM Claim Requires Multi-Vehicle Accident

In the case of Estate of O’Connell v. Progressive Insurance, No.1517 EDA 2012, 2013 Pa. Super. 271(Oct. 8, 2013), the Pennsylvania Superior Court ruled that the availability of UIM coverage requires a multi-vehicle accident. 

According to the court's Opinion, this matter involved a single car accident that resulted in the death of the driver and two passengers.

The vehicle was covered by an auto insurance policy issued by Progressive to one of the passengers who had permitted the tortfeasor defendant to drive the vehicle. Following the accident, Progressive awarded the estates of the two passengers $100,000 each in liability coverage. The tortfeasor defendant driver of this single car accident also separately maintained auto insurance issued by Allstate Insurance Company ("Allstate").  Allstate awarded the estates of the two passengers $15,000 each in liability coverage.

The Progressive policy issued to one of the decedent passengers and covering the vehicle involved in the accident also provided $100,000 per person/$300,000 per accident in underinsured motorist ("UIM") coverage for each automobile covered by the policy. Three automobiles were covered by the policy, and the insured opted to have their coverage stacked, entitling them to as much as $300,000 per person/$900,000 per accident in UIM coverage. Following the settlement under the liability coverages, the estates of the two passenger decedents put Progressive on notice of a UIM claim under the same policy, asserting that Weber's automobile was an underinsured motor vehicle.

Progressive denied the UIM claim on the ground that the vehicle involved in the accident belonged to the wife/mother of the deceased husband and deceased son passengers.  Progressive asserted that, under its policy terms, the vehicle involved therefore did not meet the definition of an underinsured motor vehicle.

More specifically, under the policy, it was provided that the definition of an "underinsured motor vehicle" did "not include any vehicle or equipment…owned by you or a relative or furnished or available for the regular use of you or a relative [or] that is a covered auto.”

The Plaintiffs filed a Complaint asserting breach of contract and bad faith, based on the denial of UIM benefits. Progressive responded with preliminary objections in the nature of a demurrer.

Following oral argument, the trial court sustained Progressive's objections and dismissed Plaintiffs' Complaint.

On appeal, the Superior Court affirmed the trial court's decision and entered judgment for the carrier in this UIM claim. 

The court found that the terms of the policy were clear and unambiguous.  More specifically, coverage under the policy is triggered when a tortfeasor's liability for the injury is dependent upon his ownership, maintenance, or use of an underinsured motor vehicle.

Here, the tortfeasor was operating a vehicle that was owned by the Progressive insured and which could not be considered an "undersinsured motor vehicle" as per the definitions contained in that policy.

The court rejected the Plaintiff's attempt to argue that the tortfeasor driver was underinsured with respect to his own separate vehicle as covered by Allstate Insurance.  Among other reasons for rejecting this argument, the Superior Court expressly held that "the availability of UIM coverage requires a multi-vehicle accident" which was not the case in this single car accident matter.

Anyone wishing to review this case may click this LINK

Source:  "Court Summaries," by Timothy L. Clawges, Pennsylvania Bar News (November 4, 2013)


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