Another Court Upholds The Validity of the Household Exclusion

In the case of Erie Insurance Exchange v. Kennedy, No. 10106 of 2024, C.A. (C.P. Lawr. Co. Jan. 27, 2025 Hodge, J.), the court granted a UIM carrier’s Motion for Judgment on the Pleadings and confirmed that a Plaintiff was barred from recovering UIM benefits under the subject policy based upon an application of the household exclusion. In so ruling, the court relied upon the case of Erie Insurance Exchange v. Mione, 289 A.3d 524 (Pa. 2023).

According to the Opinion, two (2) individuals were killed in a motorcycle accident. The motorcycle was insured by Progressive Insurance. Progressive denied coverage for UIM benefits.

The decedents were also insured under a policy issued by Erie Insurance Exchange that had an exclusion for damages sustained by any insured who occupied a vehicle owned by the insured but which was not insured for UIM benefits under the Erie Insurance policy.

The court found that the facts of the case fell under the case of Erie Insurance Exchange v. Mione.

The trial court otherwise noted that the household vehicle exclusion is not enforceable if the insured is seeking to stack the UIM coverage in question with UIM proceeds from another policy in order to circumvent the household vehicle exclusion. Here, however, there was no stacking of UIM coverage involved in the case and the carrier was found to have properly denied UIM coverage under the household vehicle exclusion.

Anyone wishing to review a copy of this decision may click this LINK.

Source: The Legal Intelligencer Common Pleas Case Alert, www.Law.com (March 27, 2025).

Source of image:  Photo by Alex Dos Santos on www.pexels.com.

Seismic Change Caused By Superior Court Decision That Allows Plaintiffs To Recover Liability and UIM Coverage From the Same Policy

The year 2025 is starting off with a Pennsylvania Superior Court decision that will cause a change of seismic propotions in automobile UM/UIM litigation going forward.

In the case of Erie Insurance Exchange v. Baluch, No. 2025 Pa. Super. 2 (Pa. Super. Jan. 2, 2025 Panella, P.J.E., Lane, J., and Stevens, P.J.E.)(Op. by Panella, P.J.E.), the Pennsylvania has ruled that, in certain circumstances a Plaintiff can recover both liability and UIM coverage from the same policy.

The appellate court framed the issue in this case as whether an insured is entitled to stacked UIM benefits although another household policy excludes vehicles that are insured under the policy from the definition of “underinsured motor vehicles.”

According to the Opinion, in April 2022, the Plaintiff, while riding as a passenger on a motorcycle, suffered serious bodily injury from a single vehicle motorcycle accident.

Two insurance policies issued by Erie were relevant to this case. The Plaintiff’s stepfather and mother were named insureds on a policy that covered the motorcycle and other vehicles (“Policy 1”). As a member of her parent’s household, the Plaintiff was an insured of Policy 1. Policy 1 provided $100,000 per person in liability coverage and $100,000 per person in uninsured motorist (“UM”) and UIM coverage.

The Plaintiff also had a separate policy for her personal vehicle (“Policy 2”). Policy 2 provided $100,000 in UM/UIM coverage.

The Superior Court noted that, “[i]mportantly,” under both Policy 1 and Policy 2 the insureds had selected stacking UIM coverage.

According to the Opinion, Erie paid out to the Plaintiff the $100,000 liability coverage from Policy 1 and $100,000 in UM/UIM coverage from Policy 2. However, Erie denied the Plaintiff’s claim seeking $100,000 in UM/UIM coverage from Policy 1 through stacking.

Under Policy 1, vehicles that are insured under the policy were excluded by the language of the policy from the definition of “underinsured motor vehicle.”  It is this exclusion that Erie relied upon to deny the Plaintiff UIM benefits from Policy 1.

The Superior Court disagreed with the carrier’s position, as well as the trial court’s position, that the resolution of the issue presented was controlled by Wolgemuth v. Harleysville Mut. Ins. Co., 535 A.2d 1145 (Pa. Super. 1988) (en banc) and Newkirk v. United Servs. Auto. Ass’n, 564 A.2d 1263 (Pa. Super. 1989).

The Superior Court noted that the Wolgemuth and Newkirk decisions stand for the proposition that liability coverage and primary underinsured motorist (“UIM”) coverage cannot come from the same, single policy. The Superior Court in this Erie Insurance v. Baluch case emphasized that the Wogelmuth and Newkirk cases addressed only a single insurance policy, not any issues of stacked coverage between two or more policies.

The Superior Court distinguished this Erie Insurance v. Baluch case by noting that this Baluch case involved secondary UIM coverage on another vehicle in the household that was stacked on top of the primary UIM coverage from a separate policy that actually covered the vehicle/motorcycle that was involved in the accident.

The Superior Court reasoned that when an insured has their own motor vehicle insurance policy that provides stacked UIM coverage, under Pennsylvania’s Motor Vehicle Financial Responsibility Law, they are entitled to stack UIM coverage from other household policies unless they expressly choose to waive stacked coverage. See 75 Pa.C.S.A. § 1738(a).

In this regard, the Superior Court cited favorably to the case of Gallagher v. GEICO, 201 A.3d 131 (Pa. 2019) and related cases as precedent that prevents an automobile insurance carrier from having policy language that acts as a de facto waiver of stacked coverage where the MVFRL requires carriers to secure written waivers of stacked coverage from its insureds.

Here, the Superior Court found that the insured Plaintiff elected and paid for stacked UIM coverage under her own separate policy. As such, Erie Insurance Exchange’s limited definition of “underinsured motor vehicle,” in the eyes of this Superior Court panel, acted as a disguised waiver of UIM coverage and the Court therefore found the exclusionary language under the policy to be invalid as conflicting with the requirements of the MVFRL relative to UIM coverage.

Accordingly, the Superior Court ruled that, because Erie’s policy provision prevented the Plaintiff from recovering stacked UIM benefits for which she paid, and given that the trial court had erred in concluding that the present case was controlled by Wolgemuth and Newkirk, the Superior Court reversed the trial court’s decision and entered a ruling in favor of the Plaintiff.

In the end, the Superior Court reasoned that, under Pennsylvania law, an injured party should be entitled to receive the coverage for which they paid. Here, the Plaintiff paid for stacked coverage and, in the eyes of this panel, was entitled to such coverage.

Anyone wishing to review this Opinion may click this LINK.

I send thanks to Scott Cooper, Esq. of the Harrisburg, PA law firm of Schmidt Kramer, as well as Adam T. Wolfe, Esq. and Ally Sholley, Esq. of the Enola, PA law firm of Shollenberger, Januzzi & Wolfe for bringing this notable decision to my attention.

Motorcycle Accident Case Against PennDOT Regarding Pothole Allowed to Proceed

In the case of Texeira v. Commonwealth Dept. of Transp., No. 997 C.D. 2021 (Pa. Cmwlth. Aug. 30, 2022 McCullough, J.), the Commonwealth Court found that a trial court erred in finding that PennDOT has sovereign immunity in the Plaintiff’s negligence lawsuit over his motorcycle accident that was allegedly caused by a pothole.

The appellate court found that the trial court erred in granting summary judgment because the Plaintiff’s complaints to PennDOT about road conditions were not in writing and there were material issues of fact as to whether the customer service records were sufficiently to provide notice to PennDOT.

There were also issues of fact as to whether or not the potholes were patched prior to the accident.

The case was reversed and remanded to the trial court for further proceedings.

Anyone wishing to review a copy of this decision may click this LINK.


Source: “Digest of Recent Opinions.” Pennsylvania Law Weekly (Sept. 27, 2022).

Source of image:  Photo by Ian Taylor on www.pexels.com.

It's Alive, It's Alive!! -- The Pennsylvania Superior Court Upholds the Household Exclusion as Enforceable (Currently Listed as "Non-Precedential")

Yesterday, the Pennsylvania Superior Court held in Erie Ins. Exch. v. Colebank, No. 1244 WDA 2021 (Pa. Super. April 20, 2022 Bender, P.J.E., Lazarus, J., McCaffery, J.)(Op. by McCaffery, J.), a decision which the Court listed as a Non-Precedential decision, that a household exclusion was enforceable in a situation where a claimant was injured while driving a vehicle on which all UIM coverage had been rejected.

In the Colebank case, the claimant was injured while driving a vehicle insured by State Farm. Notably, the claimant had rejected all UIM coverage on the State Farm policy.

After an accident with an allegedly underinsured driver, the claimant made a claim for stacked UIM coverage under his parents’ separate Erie Insurance policy.

Coverage was denied by Erie Insurance on the basis of the household exclusion contained within the Erie Insurance policy.  Erie asserted that the Gallagher v. GEICO case was not controlling because the claimant had knowingly rejected UIM coverage under his own State Farm policy and, therefore, the issue of stacking was not in play.

The claimant argued that the claimant’s rejection of stacking under the State Farm motorcycle policy was irrelevant as to the issue of whether he was entitled to stacked coverage under the Erie policy.  The claimant asserted that he was still entitled to stacked coverage under the terms of the Erie policy possessed by his parents as he was a resident relative.  The claimant also argued that the household exclusion was contrary to the mandates of the MVFRL and was, therefore, void and unenforceable.

The court disagreed. The Pennsylvania Superior Court ruled that enforcing the household exclusion in the parents’ policy was consistent with the legislative intent of MVFRL and with Gallagher because such enforcement will have the effect of holding the claimant to his voluntary choice of coverage or a lack thereof. 

Moreover, the Pennsylvania Superior Court ruled that, because the claimant had rejected UIM coverage on his motorcycle policy, “Gallagher is not applicable and did not invalidate the household exclusion.”  Rather, the Court found that, where the injured party did not purchase stacked coverage under his own policy, he did not have the requisite coverage on which to stack the UIM coverages under his parents' separte household policies.  

Notably, the Superior Court noted that this analysis "is consistent with the MVFRL as the [claimant] voluntarily chose not to purchase UIM coverage in his automobile policy, and in return received reduced insurance premiums."  See Op. at p. 25.

Anyone wishing to review this decision may click this LINK.

I send thanks to Attorney Benjamin P. Novak, Esq. from the Lancaster, PA office of Fowler, Hirtzel, McNulty & Spaulding, LLP, for bringing this notable decision to my attention.

Source of image:  Photo by Andrea Piacquadio on www.pexels.com.

Motion For Summary Judgment Entered in Favor of PennDOT in Pothole Case

In the case of Teixeira v. Com. of Penna., Dept. of Transp., No. 7917-CIVIL-2019 (C.P. Monroe Co. Aug. 5, 2021 Williamson, J.), Judge David J. Williamson of the Monroe County Court of Common Pleas granted the Defendant’s Motion for Summary Judgment in a matter involving a motorcycle accident.

The Plaintiff motorcyclist alleges that he hit a large pothole on Interstate Route 80 in Monroe County as a result of which he crashed and sustained multiple injuries.

The court noted that the issue before it concerned the pothole exception to the sovereign immunity allowed under the Political Subdivision Tort Claims Act, 42 Pa. C.S.A. §8522(b)(5). The Commonwealth of Pennsylvania asserted that it was protected from civil suits based in tort under the doctrine of sovereign immunity unless one of the ten narrow exceptions to the law apply. As noted, the Plaintiff was arguing the potholes and other dangerous conditions exception to the Act.

The court noted that a Plaintiff seeking to utilize this exception must prove that there was sufficient prior written notice provided to the Commonwealth of Pennsylvania of the allegedly dangerous condition.

Here, the court accepted PennDOT’s argument that the Plaintiff failed to show that there was actual written notice provided to PennDOT of the pothole in question. 

The court noted that, while the record revealed that various complaints were called in by members of the public and reduced to writing by the PennDOT call center, those complaints identified problems with Route 80 in general and varied widely in terms of complaints with respect to the area where potholes existed. 

The court additionally noted that nothing was submitted in actual writing by the actual complainants themselves to PennDOT. 

The court additionally confirmed that none of the complaints identified in the records reference the exact pothole that was involved in this accident. Nor were any of the complaints specific to the mile marker at the location of the accident. Rather, the complaints were generally applied to Route 80 which stretches at least 20 miles through Monroe County.

As such the court found no genuine issue of material fact was presented in this case on the question at issue of whether any actual notice of the pothole in question was provided to PennDOT prior to the subject incident. As such, the court granted PennDOT’s Motion for Summary Judgment.


Anyone wishing to review a copy of this decision may click this LINK.

Link to Erie Insurance v. Petrie Decision

Yesterday I wrote on the case of Erie Insurance Exchange v. Petrie, No. 261 EDA 2020 (Pa. Super. Nov. 18, 2020 Pellegrini, J., Nichols, J., Kunselman, J.)(Op. By Kunselman, J.), in which the Pennsylvania Superior Court held that the carrier improperly denied a UIM claim of an insured who had rejected stacking on two separate policies with two different companies and, in so ruling, credited Gallagher v. GEICO with widespread effect.

I forgot to include the Link to the decision -- sorry about that!

Anyone wishing to review this case, may click this LINK.

Panel of Pennsylvania Superior Court Judges Gives Gallagher v. GEICO Wide Effect

The debate on the effect of the Pennsylvania Supreme Court's decision in Gallagher v. GEICO, 201 A.3d 131 (Pa. 2019), continues on.

This question was most recently addressed by a panel of Pennsylvania Superior Court Judges in the case of Erie Insurance Exchange v. Petrie, No. 261 EDA 2020 (Pa. Super. Nov. 18, 2020 Pellegrini, J., Nichols, J., Kunselman, J.)(Op. By Kunselman, J.).

In Petrie, the Pennsylvania Superior Court held that the carrier improperly denied a UIM claim of an insured who had rejected stacking on two separate policies with two different companies and, in so ruling, credited Gallagher v. GEICO with widespread effect.

According to the Opinion, the Plaintiff was fatally injured in an accident while he was riding a motorcycle.

Relative to the UIM claims, the Plaintiff had recovered UIM benefits under a policy issued to him by Foremost Insurance for the motorcycle. At the time the Plaintiff also had another policy in the household with Erie Insurance that covered four other vehicles in the household, unstacked.

In addition to Erie having secured a rejection of stacking from the insured, the Erie policy also contained a Household Exclusion. The Household Exclusion relieved Erie of having to provide UIM benefits relative to any accident was insured in while in another vehicle of the household that was not insured by Erie Insurance.

Erie asserted that the executed rejection of stacking precluded the Plaintiff’s efforts at inter-policy stacking between the Erie policies and the Foremost policy that covered the motorcycle.

Erie filed this Declaratory Judgment action and filed a motion for judgment on the pleadings. The trial court granted the motion and the Plaintiff appealed. As noted, with its decision the Superior Court reversed and remanded the case for further proceedings. 

The Pennsylvania Superior Court found that the waiver of inter-policy stacking was ineffective under Craley v. State Farm Fire & Cas. Co., 895 A.2d 530 (Pa. 2006). More specifically, the Superior Court, relying upon a footnote in Craley which the carrier in this matter asserted was dicta, agreed with the Plaintiff that the waiver form did not clearly put the insured on notice that he was waiving inter-policy stacking at the time he purchased insurance. The Plaintiff had argued in this matter that the waiver form only referenced a “policy” and not “policies” and that the Plaintiff was, therefore, not put on clear notice that the waiver of stacking would also apply to policies issued by other companies. 

The Superior Court also ruled that the Pennsylvania Supreme Court’s decision in Gallagher v. GEICO which invalidated the household exclusion is not limited to its facts. The Superior Court in this Petrie case also held that the Household Exclusion was invalid as a de facto waiver of stacked coverage when Pennsylvania law required that carriers secure written waivers or rejections of stacked coverage from its insureds. As such, the Superior Court judges weighing in on this case took the view that Gallagher v. GEICO was not limited to its facts which involved the same carrier issuing both policies at issue in that case.

In footnote 7 in this Petrie decision, the Pennsylvania Superior Court noted that the Pennsylvania Supreme Court is addressing the Craley issue in the case of Donovan v. State Farm but that the Superior Court was required to decide this Petrie case based upon the law at present. 

In the end, the Superior Court reversed the trial court’s granting of a motion for judgment on the pleadings in favor of the carrier and remanded the case for further proceedings.

Anyone wishing to review this case, may click this LINK.

Regular Use Exclusion Not Defeated by Gallagher v. Geico Analysis

As some auto litigators may be aware, there is a movement afoot in the Plaintiff's bar to try to use the Pennsylvania Supreme Court's decision in Gallagher v. Geico, 201 A.3d 131 (Pa. 2019), in which that court invalidated the Household Exclusion in UM/UIM automobile policies, as a means to attack the Regular Use Exclusion as well.

Under the Regular Use Exclusion, a carrier need not provide coverage to its insured where the insured was involved in an accident while using a vehicle that was regularly available for his or her use.  The rationale is that the carrier did not know of that risk when it assessed its premium to its insured when the insurance policy was sold to the insured. 

Stated otherwise, an insured cannot secure coverage for his or her use of a vehicle regularly available to be driven by that insured if the insured never told the carrier about his or her use of that vehicle and never paid a premium for such coverge.  Simply put, you can't get something (coverage) for nothing (not paying a premium).

One Plaintiff's effort to rely upon the Gallagher v. Geico rationale to defeat a Regular Use Exclusion was rebuffed by the Federal Western District Court of Pennsylvania in the case of Barnhart v. Travelers, No. 2:19-CV-00523-MJH (W.D. Pa. Oct. 28, 2019 Horan, J.).

The Court in Barnhart granted a Defendant carrier's Motion to Dismiss the Plaintiff's Complaint and denied the Plaintiff any right to amend the Complaint as the same would have been futile under the law. 

In this case, the Plaintiff was injured as a result of an accident that occurred while she was a passenger on a motorcycle that was insured by Progressive Insurance.  After the Plaintiff recovered from the tortfeasor, she pursued a UIM claim under a Travelers policy that covered two cars the Plaintiff and her husband owned.

Travelers relied upon the Regular Use Exclusion given that the motorcycle on which the Plaintiff was involved in the accident was regularly available for the Plaintiff's use and was not covered under the Traveler's policy.

The Plaintiff argued that the Regular Use Exclusion was unenforceable under the Gallagher v. Geico analysis.

The Court in Barnhart specifically held that the Pennsylvania Supreme Court's holding in Gallagher "does not extend to invalidate the 'regular use exclusion'" or to overturn caselaw that supports the continued validity of the regular use exclusion.  See Op. at p. 8.

As such, the Defendant carrier's motion to dismiss the Plaintiff's Complaint was granted because the Regular Use Exclusion was found to defeat the Plaintiff's claims.

Anyone wishing to review the Barnhart decision may click this LINK.

I send thanks to Attorneys Brigid Q. Alford and Brooks Foland of the Camp Hill, PA office of Marshall, Dennehey, Warner, Coleman & Goggin for bringing this case to my attention.  I also thank Attorney Sara B. Richman Pepper Hamilton, LLC for notifying me of this decision as well.

Lancaster County Court of Common Pleas Applies Gallagher v. GEICO Retroactively

In the Court of Common Pleas of Lancaster County case of Rutt v. Donegal, No. CI-19-02544 (C.P. Lanc. Co. Sept. 16, 2019 Brown, J.), the court addressed the application of the Pennsylvania Supreme Court’s decision in Gallagher v. GEICO, which addressed the validity of the Household Exclusion in automobile insurance policies. 

According to the Opinion, the Plaintiff was involved in a motor vehicle accident while riding on a motorcycle that was covered by a carrier other than Donegal.

The Plaintiff recovered damages from the liability policy possessed by the tortfeasor as well as under the policy that covered his own motorcycle.  The Plaintiff then turned to Donegal for additional UIM coverage under a Donegal policy that covered another vehicle in the Plaintiff’s household. 

Donegal denied the claim under its Household Exclusion contained in its policy.

The Plaintiff responded by filing suit.  Donegal filed Preliminary Objections in the nature of a demurrer, asserting that the Gallagher decision could not be applied retroactively to apply to this case. 

The court in Rutt ruled that the Gallagher decision applied retroactively and applied a rationale similar to that voiced by the Eastern District Court in its decision in Butta v. GEICO.  In so ruling, the Rutt court also read the Gallagher decision in an expansive fashion, rejecting the effort by Donegal to limit Gallagher to its facts involving separate policies that were issued by the same carrier.

Anyone wising to review this decision may click this LINK.

I send thanks to Attorney Scott Cooper of the Harrisburg, PA law firm of Schmidt Kramer for bringing this case to my attention.

Gallagher v. GEICO Household Exclusion Decision Extended Yet Again by Eastern District Federal Court

The Pennsylvania Supreme Court’s monumental decision in Gallagher v. GEICO eradicating the Household Exclusion continues to be expanded by the Federal District Court Judges in the Eastern District of Pennsylvania.

In Gallagher v. GEICO, the Pennsylvania Supreme Court ruled that the Household Exclusion was void in a case in which the same carrier had issued both insurance policies at issue, i.e., the policy that covered the vehicle the plaintiff was operating at the time of the accident and another policy on another vehicle in the same household, and where stacking had not been waived with respect to either of the policies.

In the case of Donovan v. State Farm Mut. Auto. Ins. Co., No. 17-03940 (E.D. Pa. June 28, 2019 McHugh, J.)(Mem. Op.), the eradication of the Household Exclusion by the Pennsylvania Supreme Court in Gallagher v. GEICO was extended to apply to cases even where an insured had waived stacking on both policies at issue.

In Donovan, a plaintiff was injured while riding his motorcycle.  The Plaintiff had a motorcycle policy with State Farm providing unstacked coverage of $25,000 in UIM benefits on the motorcycle.

The plaintiff lived with his mother who had her own State Farm policy with unstacked UIM benefits of $100,000 per person.

State Farm tendered the $25,000 unstacked UIM limits under the motorcycle policy but denied the claim under the mother’s policy on the basis of the Household Exclusion in the policy and on the basis of the mother's waiver of stacking.

Judge McHugh of the Eastern District Federal Court found that the Plaintiff was entitled to recovery the UIM coverage under the mother’s policy.  

The court found that the waiver of stacking utilized by State Farm only served to waive intra-policy stacking and not inter-policy stacking, as was at issue in this case involving separately issued insurance policies to different named insureds.

The Court also held that, even though the policy at issue provided for unstacked coverage, the Gallagher v. GEICO decision still applied to render the Household Exclusion in the State Farm policy to be invalid.  Judge McHugh also went on to offer his assessment that the Gallagher v. GEICO decision is not to be limited to its facts.

Anyone wishing to review the Donovan Opinion may click this LINK.  The companion Order can be viewed HERE.

To review the recent trend of Household Exclusion cases reported here on Tort Talk, please go to Tort Talk at www.TortTalk.com, scroll all the way down the right hand side until you get to the "Labels," and then scroll down to the label of "Household Exclusion" and click on that label.

I send thanks to Attorney Scott Cooper of the Harrisburg, PA office of Schmidt Kramer for bringing this decision to my attention.  Please consider joining Scott Cooper and myself for a PBI CLE Webinar on the Gallagher v. GEICO decision and its progeny on July 8, 2019 at noon.  More details are provided in the separate Tort Talk post from today.

Plaintiff Found to "Occupy" Motorcycle Even After Being Ejected From It During Accident (Non-Precedential Decision)

In the case of Petra v. Pennsylvania Nat’l Mut. Ins. Co., No. 505 MDA 2018 (Pa. Super. Jan. 16, 2019 Ott, J., McLaughlin, J., Ford Elliot, P.J.E.) (Non-precedential Op. by McLaughlin, J.), the court ruled that an exclusion in an auto insurance policy precluded coverage of a motorcyclist’s claims for injuries he suffered when he collided with another driver’s motorcycle.   The court found that the motorcyclist was “occupying” the motorcycle even after colliding with the car and becoming separated from his motorcycle.  

According to the Opinion, the Plaintiff was operating his motorcycle when he was involved in an accident with another car and was ejected from the motorcycle and hit the ground. No other vehicles were involved in the accident.  

The Plaintiff insured his motorcycle under a policy under which he had rejected uninsured and underinsured motorist coverage.

At the time of the accident, the Plaintiff motorcyclist also owned a minivan that was insured with Penn National Insurance Company.  

The Plaintiff sued Penn National to recover UIM benefits under that policy that separately covered the Plaintiff's minivan.  

The case came before the court by way of a Motion for Summary Judgment. 

Under the Penn National policy issued to the Plaintiff’s minivan, it was provided that the policy would not provide UIM coverage for bodily injury sustained by the Plaintiff while “occupying,” or when struck by, any motor vehicle you owned which is not insured for this coverage under this policy.   The policy defined “occupying” to mean “in, upon, getting in, on, out or off.”  

The Plaintiff argued that the exclusion in the Penn National policy did not preclude coverage because he was not “occupying” a non-insured motor vehicle, i.e., his motorcycle, at the time he was injured.   Rather, the Plaintiff asserted that some of his injuries were sustained while he was in physical contact with the motorcycle and some other injuries occurred after he became separated from the motorcycle, i.e., when he was not occupying the motorcycle.

The court rejected the argument that the Plaintiff was not occupying his motorcycle at the time he was injured.  The Superior Court noted that “[s]egmenting the accident under [the Plaintiff’s] analysis would create an absurd result.”   The court additionally found that the argument put forth by the Plaintiff was “not persuasive.”  

Pointing out that the Plaintiff had stipulated that this matter involved a single accident and that there were no intervening or superseding accidents, the Superior Court ruled that, construing the “unambiguous terms” of the exclusion in the Penn National policy supported a conclusion that the Plaintiff suffered bodily injury while occupying his motorcycle, a vehicle not covered by the policy.   The court concluded that the Plaintiff occupied his motorcycle from the moment of impact with the tortfeasor’s vehicle, through the ejection, and until his body came to a rest on the ground.  

As such, the Plaintiff was determined not to be entitled to recover UIM benefits.  

As a parenthetical, it is noted that this decision was decided before the Pennsylvania Supreme’s Court’s decision invalidating the household exclusion in the case of Gallagher v. Geico.   It remains to be seen what, if any impact the Gallagher decision will have upon this case or the court's decision.  

Anyone wishing to review a copy of decision in the case of Petra may click this LINK. 

Source: “Court: Motorcyclist as ‘Occupying’ Motorcycle Even After Colliding with Car” by Steven A. Meyerowitz, The Legal Intelligencer (Feb. 1, 2019). 


UPDATE:  In September of 2019, the Pennsylvania Supreme Court vacated and remanded the Superior Court's above January 16, 2019 decision in light of the Pennsylvania Supreme Court's decision in Gallagher v. GEICO.

On remand, however, another Superior Court panel ruled, in an October 31, 2019 decision that the Plaintiff had failed to preserve a challenge under the Gallagher decision and, therefore, waived that issue.  Click this LINK to view that decision.

Thereafter, on March 24, 2020, the Pennsylvania Supreme Court decline to grant allocatur in the case a second time.

Pennsylvania Law Weekly Reports on Monumental Household Exclusion Decision Recently Issued by Pennsylvania Supreme Court

Here is a LINK to an article issued online Friday, Feb. 1, 2019 by the Pennsylvania Law Weekly entitled "New Class Actions Pile Up in Wake of Pa Justices' 'Seismic' Stacking Ruling" written by Max Mitchell (what a great name for a newspaper reporter).

The article covers the fallout from the Pennsylvania Supreme Court's recent decision in the case of Gallagher v. GEICO in which that Court ruled that the Household Exclusion in automobile insurance policies was invalid as being in violation with the mandates of the MVFRL requiring carriers to secure waivers of stacking of UM/UIM benefits.

If you are not able to access the article via the above Link, please email me at dancummins@comcast.net and I will send you a copy.

BREAKING NEWS: Pennsylvania Supreme Court Rules That Household Exclusions Are Unenforceable As A Matter of Law

In a 5-2 decision, in the case of Gallagher v. GEICO, 35 WAP 2017 (Pa. Jan. 23, 2019)(Op. by Baer)(Dissenting Op. by Wecht), handed down by the Pennsylvania Supreme Court today, the Court held that the household exclusion impermissibly narrows the mandates of Section 1738 and, as a result, violates the Pennsylvania Motor Vehicle Financial Responsibility Law.  As such, the household exclusion is impermissible as a matter of law. 

In this matter, the Plaintiff was operating a motorcycle when he was involved in an accident with another vehicle.

At the time of the accident, the Plaintiff had two policies with GEICO.  One policy, which included $50,000 of UIM coverage, only covered the motorcycle.  The second policy purchased by the Plaintiff from GEICO covered two other vehicles owned by the Plaintiff and provided for $100,000 of UIM coverage for each vehicle.  The Plaintiff opted and paid for stacked UM and UIM coverage when purchasing both policies.  Thus, when stacked, the policies amounted to $250,000 in UIM coverage if the household exclusion in the Automobile policy was found not to apply.

GEICO asserted that the household exclusion in the Automobile policy precluded the Plaintiff from recovering the UIM benefits under that policy.  The Plaintiff argued that the household exclusion stripped him of the stacked coverage he was entitled to under the MVFRL because he did not waive stacked UIM coverage.

The Court in Gallagher turned to Section 1738 of the MVFRL and noted that that provision provides that the limits of coverage for each vehicle owned by an insured “shall be the sum of the limits for each motor vehicle as to which the injured person is an insured.”  The court noted that this Section specifically applies “[w]hen more than one vehicle is insured under one or more policies” providing UM/UIM coverage.  The Supreme Court stated that, “[i]n other words, stacked UM/UIM coverage is the default coverage available to every insured and provides stacked coverage on all vehicles and all policies.”  See Op. at p. 10.

The Supreme Court sided with the Plaintiff under the basic rationale that the household exclusion “is inconsistent with the unambiguous requirement of Section 1738 of the MVFRL under the facts of this case insomuch as it acts as a de facto waiver of stacked UIM coverage provided for in the MVFRL, despite the indisputable reality that [the Plaintiff] did not sign the statutorily prescribed UIM coverage waiver form.”  See Op. at p. 11.

The Court went on to note that in a case such as this one where the same carrier issued all of the policies at issue, it could have charged higher premiums and/or secured a valid waiver of stacked coverage between the policies from the insured in order to avoid the result of this decision.

Anyone wishing to read this decision, including the dissent, may click this LINK

Commentary:  Going forward, instead of now attempting to rely upon now invalid household exclusions, carriers may be charging higher premiums for stacked coverage or requiring its insureds to sign more stacking waiver forms.

I send thanks to Attorney Scott Cooper of the Harrisburg, PA law firm of Schmidt Kramer for bringing this decision to my attention.  I also send thanks to the numerous other attorneys who forwarded this decision as well.  Thank you.