Western Federal District Court Narrows Application of Gallagher v. Geico To Its Facts

A Federal Western District Court Judge has joined those judges who have breathed life into the Household Exclusion by limiting the Gallagher v. Geico decision to its facts and rejecting a reading that the Pennsylvania Supreme Court's decision eradicates the exclusion across the board.

In the case of Dunleavy v. Mid-Century Ins. Co., No. 2:19-CV-1304 (W.D. Pa. May 19, 2020 Ranjan, J.), Judge Ranjan of the Pennsylvania Western Federal District Court held that the Pennsylvania Supreme Court’s decision in Gallagher v GEICO, in which that court ruled that the household exclusion was no longer valid, did not apply to invalidate a household exclusion in this case where the insured had waived UIM coverage on a motorcycle insured with another carrier. 

The Court in Dunleavy therefore ruled that the claimants were not entitled to stacked UIM coverage from their automobile insurer because there was no coverage on the motorcycle with which to stack. In other words, the claimants had waived stacking on the motorcycle policy, which had been issued by a different carrier.

In its decision, the Court also held that, because the Plaintiff’s claims failed with respect to the household exclusion issue, the Plaintiff’s claims for bad faith and under the Unfair Trade Practices and Consumer Protection Law also failed.

Anyone wishing to review this decision may click this LINK.

I send thanks to Attorney Patricia A. Monahan of the Pittsburgh office of the Marshall Dennehey law firm for bringing this case to my attention.