In this matter, the Plaintiff brought a UIM breach of
contract, loss of consortium, and bad faith action against both the claims
representative and the carrier.
The carrier argued that the claims representative was
“fraudulently joined” by the Plaintiff in an effort to defeat Federal Court diversity jurisdiction. The carrier additionally asserted
that bad faith actions against claims representative are not permissible.
The Eastern District Federal Court agreed with the carrier’s
position and noted that the claims asserted against the claims representative were
“wholly insubstantial and frivolous.”
The court stated that, as a matter of law, there is no basis to support a claim against the claims representative because only the carrier may be held liable under the claims presented. The court noted that the claims representative, who was only an agent of the carrier, did not have a separate contract with the insured.
The court stated that, as a matter of law, there is no basis to support a claim against the claims representative because only the carrier may be held liable under the claims presented. The court noted that the claims representative, who was only an agent of the carrier, did not have a separate contract with the insured.
The court additionally held that a bad faith claim could not
be asserted against a claims representative as the bad faith statute only
applies to insurance companies.
As such, the court held that the Plaintiff had improperly
joined the claims representative in this lawsuit. As such, the claims representative was dismissed from the case and the Plaintiff's motion to remand was denied.
Anyone wishing to review this decision may click this LINK.
I send thanks for Attorney Lee Applebaum of the Philadelphia
law firm of Fineman, Krekstein & Harris, and the writer of the Pennsylvania
and New Jersey Insurance Bad Faith Case Law blog, for bringing this case to my
attention.
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