Third Circuit Court of Appeals Confirms that Any Writing Can Serve as a UIM Sign Down Form

In the case of Gibson v. State Farm Mut. Auto. Ins. Co., No. 20-1609 (3d Cir. Jan. 21, 2021 Hardiman, J., Roth, J., and Pratter, J.) (Op. by Pratter, J.), the court addressed the requirement under §1734 of the Motor Vehicle Code with respect to the valid election for reduced underinsured motorist coverage.

At the outset of its Opinion, the Third Circuit noted that, although basic UIM coverage is typically offered in an amount equal to the bodily injury limits set forth in an automobile insurance policy, an insured in Pennsylvania can reduce premium costs by opting for a lower amount of underinsured motorist coverage. The court noted that, to accomplish this result, the Pennsylvania law requires, under  75 Pa. C.S.A. §1734, that the insured make a “request in writing.” 

The Third Circuit indicated that the statute says “little beyond that. But that silence speaks volumes. As we reiterate today, the statute means what it says: an insured can make that choice “in writing” in any writing as long as the choice is clear.”  See Op. p. at 4.

In this matter, the Plaintiff signed an insurance application with the carrier for bodily injury coverage of $250,000.00 and $100,000.00 in stacked UIM coverage. The Plaintiffs had three (3) cars under the policy.

The court emphasized that the court signed an application that included language that stated “the limits and coverages [in the application] were selected by me.” The application also referenced another “required” document, an acknowledgement of coverage selection form for UIM. The carrier did not supply that form and the Plaintiff did not sign it at that time.

The Plaintiff was seriously injured in a motor vehicle accident shortly after signing the application for the insurance. Three (3) weeks after the accident, the Plaintiff signed an Acknowledgement of Coverage Selection form in which she acknowledged that she had been given opportunity to purchase UIM coverage with limits up to her liability coverage for bodily injury but had instead selected a lower UIM limits.

In the end, the court found that the Plaintiff’s signature on the application, with the language contained in the application, confirmed that the Plaintiff was electing lower UIM limits.


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Source: “Digest of Recent Opinions.” Pennsylvania Law Weekly (April 22, 2021).