Gallagher v. GEICO Limited To Its Facts By Another Court

In the case of Erie Insurance Exchange v. Mione, No. 2019-CV-2395 (C.P. Lehigh Co. June 26, 2020 Varricchio, J.), Judge Michele A. Varrichio of the Lehigh County Court of Common Pleas granted summary judgment in favor of the carrier and denied the Plaintiff’s judgment on the pleadings in a declaratory judgment action regarding the household exclusion such that the court ruled that Erie Insurance did not need to provide underinsured motorist coverage to the Plaintiff under the case presented.

In this matter, at the time of the accident, the Plaintiff owned two (2) policies issued by Erie Insurance. On the date of the accident, the Plaintiff was operating a motorcycle that was covered under a Progressive Insurance policy.

The Plaintiff recovered the applicable policy from the tortfeasor and then sought to recover benefits from the Erie auto insurance policy. Neither of the Erie Insurance policies listed the motorcycle as a covered vehicle.

Rather, as noted, the motorcycle was covered under a separate policy issued by Progressive. Moreover, it was confirmed that the Plaintiff had not purchased stacked UIM coverage on his motorcycle policy.

The Erie Insurance policies contained a household exclusion.

This decision represents another decision in which a court has limited the Pennsylvania Supreme Court decision in Gallagher v. Geico to its facts even though the judicially activist Pennsylvania Supreme Court expressed that its decision eradicated the household exclusion across the board. Rather, the court in this Erie Ins. Exch v. Mione case took a more measured approach and analogized the facts before it to be more consistent with the facts in issue in the Pennsylvania Supreme Court decision in Eichelman v. Nationwide Ins. Co., 711 A.2d 1006 (Pa. 1999).

Following Eichelman the court in this matter ruled that, in the absence of a clearly expressed public policy, the clear and unambiguous language of the valid household exclusion in the Erie auto insurance policy must be given its plain meaning.

The court also noted that, giving effect to the household exclusion would further legislative policy behind the MVFRL in holding the Plaintiff to his voluntary choice of not purchasing UIM coverage under this separate motorcycle policy for the motorcycle involved in the accident.

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