Third Circuit: Unless An Automobile Insurance Carrier Issues a New Policy, No New UM/UIM Sign Down Forms Are Required

In the case of Geist v. State Farm Mut. Auto. Ins. Co., 49 F.4th 861 (3rd Cir. Sept. 29, 2022 Randel, C.J.), the Third Circuit Court of Appeals addressed the issue of when an automobile insurance carrier may be required to secure updated UM/UIM sign down forms.

In this matter, when the insured had purchased the State Farm policy initially, two (2) vehicles were insured under the policy and the necessary forms were executed. Thereafter, the insured added a third vehicle. At that point in time, the insured did not execute a request for UIM coverage limits below the bodily injury coverage limits.

Thereafter, an insured under the policy was involved in a motor vehicle accident. After settling the tort claim against the Defendant driver, that Plaintiff turned to State Farm for UIM coverage. A dispute arose over the amount of UIM limits available.

The Plaintiff asserted that she should be provided with higher limits because State Farm did not secure a sign down form when another vehicle had been added to the policy. When State Farm disagreed, litigation ensued and eventually resulted in this decision.

The Plaintiff asserted that she was owed higher coverage because State Farm had not followed the requirements of 75 Pa. C.S.A. §1731 and 1734 relative to the forms at issue.

The Third Circuit Court of Appeals, after reviewing the existing case law, ruled that no events in the years prior to the subject motor vehicle accident triggered the obligations under §1731 and 1734 because State Farm had never issued a new policy to the insured. As such, the court found that State Farm was not obligated to seek a new written election for lower UIM coverage limits under the policy.

Rather, the court ruled that the Pennsylvania Motor Vehicle Financial Responsibility Law only required carriers to seek elections of lower UIM coverage limits only when the carriers issue policies. State Farm was found to have satisfied their duties under the law when the secured the forms when the insured had executed the requisite forms when the policy was initially issued.

The court more specifically noted that both §1731 and 1734 expressly state that the requirements contained in those statutes apply, under §1731 when an insurance company is involved in the “delivery or issuance” of a “policy,” and §1734 applied when a carrier “issues a policy.”

The court in Geist went on to note that, once the carrier meets its obligations to secure the UIM sign down forms on a particular policy, the insurance company need not do anymore to fulfill its obligations under §1731 and 1734 during the life of that particular insurance policy.

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

Source of image:  Photo by Olia Danilvoich on www.pexels.com.

Link to Complete Copy of Plaintiff-Favorable Household Exclusion Decision

A few days ago, there was a Tort Talk post on the case of Donegal Mut. Ins. Co. v. Krautsack, No. CI-19-04904 (C.P. Lanc. Co. Aug. 28, 2020 Ashworth, J.), which was a plaintiff-favorable Household Exclusion decision that followed the rationale of the Gallagher decision.

The copy of the decision provided via the Link was missing pages from the Opinion.  Here is a LINK to a complete copy of the decision. 

I apologize for any confusion or consternation caused.

I send thanks to Attorney Scott Cooper of the Harrisburg, PA office of Schmidt Kramer for securing a complete copy for me.

Plaintiff-Favorable Decision Out of Lancaster County Applying Gallagher v. GEICO Decision

Another Plaintiff-favorable Gallagher decision has been uncovered, this one out of the Lancaster County Court of Common Pleas.

In the case of Donegal Mut. Ins. Co. v. Krautsack, No. CI-19-04904 (C.P. Lanc. Co. Aug. 28, 2020 Ashworth, J.), the court granted the Plaintiff's motion for summary judgment and denied the carrier's cross-motion for summary judgment relative to issues surrounding the application of a household exclusion in an automobile insurance policy.

This case arose out of a motorcycle accident and a question of the application of a household exclusion contained in one of multiple policies in a household.

The Plaintiff argued that Gallagher should be read as eradicating the household exclusion across the board.  The carrier asserted that Gallagher should be limited to its facts and that the facts in Gallagher were distinguishable from the facts in this case.

This Lancaster County Court applied the Gallagher v. GEICO decision literally and noted that the Pennsylvania Supreme Court "unequivocally" held that household exclusions are unenforceable as a matter of law as they violate the requirements set forth in Pennsylvania's Motor Vehicle Responsibility Law that a carrier secure a written waiver or rejection of stacked UIM coverage for such waiver or rejection to be valid.

Anyone wishing to review a copy of 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.

Eastern District Court Uses Its Discretionary Power to Punt UIM Issues Back to State Court

The Federal District Courts of Pennsylvania flexed their discretionary muscles in two recent cases in which they punted two cases back to the state court that involved novel and/or unsettled questions under Pennsylvania's Motor Vehicle Financial Responsibility Law (MVFRL).

In the case of Lambert v. State Farm Mut. Auto. Ins. Co., NO.19-0816 (E.D. Pa. Oct. 16, 2019 Slomsky, J.) the Easter District Federal Court of Pennsylvania granted a motion to remand a Declaratory Judgment action involving underinsured motorist (UIM) benefit under Section 1738 of the MVFRL.

The Plaintiff originally filed the case in the Court of Common Pleas of Philadelphia County and State Farm removed it to federal court based upon diversity.

The Plaintiff then filed a motion to remand and argued that the case involved an unsettled and novel issue of Pennsylvania law such that the case should be remanded pursuant to the discretionary nature of the federal Declaratory Judgment Act. State Farm argued that even though the case involved primarily issues of state law, there was no indication the case involves unsettled and novel issues of state law.

The Court noted that the question involved in this case was whether the Section 1738 rejection of stacking form only involves the rejection of intra-policy stacking and not inter-policy stacking as well.

The District Court reviews the motion to remand under the applicable standard of review. The District Court first looked at whether there was a parallel state court proceeding. There was none but the Court noted that was not dispositive.

Then the District Court reviewed a “non-exhaustive” list of factors to be applies as set forth by the Third Circuit Court of Appeals in the case of Reifer v. Westport Ins. Co., 751 F.3d 129 (3d Cir. 2014). Applying of the Reifer factors, the Court found no impediment to request for a remand.

The District Court in Lambert ultimately found that the issue presented did involve an unsettled and novel area of the MVFRL and and as such remanded to case to the state court.

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

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


In another case with a similar result, the District Court for the Eastern District of Pennsylvania also granted a motion to remand in Sherer v. Federated Mut. Ins. Co., NO.19-2530 (E.D. Pa. Oct. 22, 2019 DuBois, J.) involving a motion to remand a Declaratory Judgment action involving underinsured motorist (UIM) benefit under Section 1731 of the Pennsylvania Motor Vehicle Financial Responsibility Law (MVFRL).

The Plaintiff had filed the original case in the Court of Common Pleas of Philadelphia County and the carrier removed the matter to federal court based upon diversity.

The Plaintiff then filed a motion to remand and argued that the case involved an unsettled and novel issue of Pennsylvania law so the case should be remanded pursuant to the discretionary nature of the federal Declaratory Judgment Act.

The carrier argued that even though the case involves primarily issues of state law, there is no indication the case involves unsettled and novel issues of state law.

The issue more specifically involved whether the Section 1731 rejection of underinsured motorist coverage form is valid. Also, another potential issue was what obligation (if any) the Plaintiff's employer had to advise that there was no UIM coverage on the vehicle the Plaintiff was operating at the time of this accident.

In deciding the motion to remand, the District Court primarily reviewed whether there was a parallel state court proceeding currently pending.  The Court found that there no such parellel case but also noted that is not dispositive.

The District Court then looked to “non-exhaustive” list of factors to be applies as set forth by the Third Circuit in Reifer v. Westport Ins. Co., 751 F.3d 129 (3d Cir. 2014). 

Applying of the Reifer factors, the Court found that there was no impediment to remand. The District Court more specifically found that the issue presented is an unsettled and novel area of the MVFRL and that remand of the case to the state court was appropriate.

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

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

Court Rules That Rejection of UIM Coverage Forms Not Required Where Vehicle Not Insured for Liability

In the case of Baldridge v. Amica Mut. Ins. Co., No. 2:17-cv-00273-AJS (W.D. Pa. June 30, 2017 Schwab, J.), the Federal Western District Court of Pennsylvania addressed the issue of whether underinsured motorist coverage was available to the Plaintiff for stacking purposes on one of his four personal vehicles which the Defendant insured.  

According to the Opinion, there was no dispute that the Defendant insurance company insured the four (4) personal vehicles of the Plaintiff.  There was also no dispute that the Plaintiff had UIM coverage in the amount of $300,000.00 on three of the four personal vehicles.  

The question before the court was whether the Plaintiff was entitled to UIM coverage on the fourth vehicle, which was noted to be a Mustang.  The more specific question for the court to resolve was whether the Plaintiff had UIM coverage in the amount of $900,000.00 ($300,000.00 multiplied by three vehicles) or $1.2 million dollars ($300,000.00 multiplied by four vehicles).  

The carrier asserted that, because it never provided liability coverage on the Plaintiff’s Mustang, the carrier was never required to also offer the Plaintiff’s UIM coverage on that vehicle.  

The Defendant carrier produced a portion of the insurance policy it issued to the Plaintiff which confirmed that the Mustang was “not covered” for liability.   Rather, that vehicle was covered only for damage to the Mustang for accidents other than collision loss.  

After a review of the waiver/rejection of UIM coverage statutes found at 75 Pa. C.S.A. §1731 and §1734, the court agreed with the carrier’s position and found that, because the Mustang was not insured for liability purposes, the Defendant carrier was never required to offer UIM benefits on that vehicle.   As such, no signed waiver of UIM benefits with respect to the Mustang was required by law.  

Accordingly, the court ruled in favor of the Defendant carrier on the motion presented.  

Anyone wishing to review this decision may click this LINK.


I send thanks to Attorney Joseph Hudock of the Pittsburgh, Pennsylvania law firm of Summers McDonnell, Hudak & Guthrie, P.C., for bringing this case to my attention.  

Eastern District Federal Court Declines to Exercise Jurisdiction Over Sackett Issue That Is Currently Pending Before PA Supreme Court

In the case of Bransfield v. New Jersey Manufacturers Ins. Co., 2017 WL 714036 (E.D. Pa. 2/23/2017) (mem.), the Eastern Federal District Court declined to exercise jurisdiction over an unsettled Sackett-type issue and remanded the case back to state court for a decision.

In Bransfield, the Plaintiffs filed declaratory judgment action in state court asserting that the insurer owed stacked UIM coverage because when the insured/owner added a vehicle to her single-vehicle auto policy, her insurer was required to obtain new UIM coverage forms and new UIM stacking rejection forms.  According to the Opinion, the insured had rejected UM/UIM and stacking prior to the addition of the second vehicle.

The Plaintiff asserted that since the insurer did not secure new UIM coverage forms or new UIM stacking rejection forms, the Plaintiff should be entitled to stacked UIM coverage.

The Bransfield court declined to exercise jurisdiction after finding that, if it did, the court would need to make a threshold determination on an unsettled question of whether the MVFRL requires new UIM rejection forms when new vehicles are added to a policy. 

The court noted that it would have to predict whether stacked UIM is available pursuant to Sackett, which the court noted was an issue before the Pennsylvania Supreme Court in Toner v. The Travelers Home and Marine Ins. Co., 137 A.3d 583(Pa. Super. 2016), appeal granted No. 29 WAP 2016 (Pa. Sept. 8, 2016).  Part of the reason the Bransfield court declined to decide the issue was to avoid a scenario where its decision could end up conflicting with how the Pennsylvania Supreme Court may ultimately rule upon the issue in Toner.

Ultimately, the Branfield court denied the carrier’s request to reconsider the court’s prior Order remanding the matter back to state court.

Anyone wishing to review this unpublished memorandum opinion in Bransfield 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.


UPDATE:  The Toner case refernced above settled just before the Pennsylvania Supreme Court was set to address the stacking issues raised therein.  As such, the Pennsylvania Superior Court's decision in the matter stands.

Pennsylvania Supreme Court Addresses Validity of Section 1731 UM/UIM Rejection Forms

In its recent decision in the case of Ford v. American States Ins. Co., No. 1800 WDA 2014 (Pa. Feb. 22, 2017)(Maj. Op. by Baer, J.), the Pennsylvania Supreme Court addressed the the validity of a Section 1731 uninsured and underinsured rejection form. 

Departing from prior decisions on the issue, the Ford Court held that a de minimis alteration to the form does not render the form void.   In other words, the Supreme Court ruled that the form does not have to be a verbatim recitation of the form contained in the statute. However, the Court further held that an alteration which can render the form ambiguous or confusing will serve to make the form void.

The Majority Opinion written by Justice Baer can be read at this LINK.

The Dissenting Opinion by Justice Donohue can be read HERE 

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