Posts Tagged ‘coverage’

Pam’s best friend Paula always seemed to be on the wrong side of luck. Paula had recently had her license suspended because of a D.U.I. conviction. Paula was pretty much dependent upon Pam to take her wherever she needed to go.

On one occasion though, Paula had to go downtown to pick up some medication and asked Pam to loan her the car to take her on this very short trip. Pam knew that Paula’s license had been suspended but for some reason, since it was such a short trip, she said it was ok.

Unfortunately for both ladies, Paula’s bad luck continued and she rear ended another vehicle on Main Street. A law suit ensued and Pam’s insurance company denied coverage.

ISSUE: Is Pam’s insurance company obligated to defend with the auto accident that Paula was involved in?

ANSWER: No. Insurance policies on automobiles almost always have a provision that if the owner of the policy allows a non-licensed or impaired driver to drive their vehicle, then that insurance company will no longer be responsible if an accident occurs. Under no circumstances should an owner or family member of an auto ever allow an individual to drive a vehicle who is not legally allowed to do so.

Disclaimer: The above article is for instructive purposes only and each case is fact sensitive. Consultation with an attorney should be obtained instead of reliance upon the legal issues discussed in this column.

Ward and June were taking a leisurely drive between Honesdale and Hawley on Route 6 when a large pickup truck heading in the opposite direction entered their lane of travel. Ward had no option but to steer as hard as he could to the right, causing the vehicle to go off the road and eventually impacting with a tree. Unfortunately, both Ward and June suffered severe injuries.

The operator of the vehicle that caused the accident never stopped nor were the police ever able to identify it.

Issue: Do Ward and his wife, June, have any recourse?

Answer: Yes. Fortunately, Ward was wise enough to cover uninsured motorist protection on his own vehicle.

In cases such as this where there is an accident caused by a phantom vehicle, Ward will be able to make a claim against his own insurance policy for his pain and suffering as well as June’s. The amount that Ward will be able to claim up to will depend upon how much coverage Ward paid for. This type of coverage is very inexpensive and all drivers should obtain at least $100,000 for uninsured motorist coverage.

Disclaimer: The above article is for instructive purposes only and each case is fact sensitive. Consultation with an attorney should be obtained instead of reliance upon the legal issues discussed in this column.

In Blood v. Old Guard, the Pennsylvania Supreme Court had to determine whether an auto insurance carrier must obtain a new UM/UIM “sign down” form from an insured each time the insured modifies the amount of his liability coverage. When presented with this same issue, the Pennsylvania Superior Court determined that the insurance company did have to obtain a new UM/UIM “sign down” form whenever the insured modified his liability coverage. In the absence of a new UM/UIM “sign down” form, the Superior Court held the amount of UM/UIM coverage available to the insured was equal to the amount of his modified liability limits. The Pennsylvania Supreme Court reversed the ruling of the Pennsylvania Superior Court, holding that an auto insurance carrier is not required to have the insured execute a new UM/UIM “sign down” form whenever the insured desires to change his liability limits under an existing policy.

In Blood, the insureds purchased an auto policy from Old Guard in 1986 with $500,000 in liabiilty coverage. At the time they purchased the coverage, the insureds elected reduced UM/UIM coverage in the amount of $35,000 (albeit with the stacking option). In June of 2000, the insureds decided to lower their liability limits from $500,000 to $300,000. To this end, they executed a “coverage selection form” indicating their desire for $300,000 in liability coverage. Although the “coverage selection form” included a choice to select an amount of UM/UIM coverage, the insured indicated no selections for UM/UIM.

The insured was injured in a motor vehicle accident in August of 2000. The insured asserted that his UIM coverage amounted to $900,000 ($300,000 stacked on three vehicles). The insured’s position was that his UIM coverage should equal the amount of his liability coverage because Old Guard did not obtain a new UM/UIM “sign down” form from his when he reduced his liability coverage to $300,000 in June of 2000. The Supreme Court rejected the insured’s position based on the plain language of 75 Pa.C.S.A. 1731 and 75 Pa.C.S.A. 1734. The Court held that these statutory provisions did not require Old Guard to re-comply with the mandates of these provisions regarding reduction in UM/UIM coverage each time an insured changed the amount of his liability coverage under an existing policy. In this regard, the Supreme Court stated:

“[T]he MVFRL does not provide any support for Appellee’s position that the [insureds'] change of liability coverage had an effect on the otherwise valid Section 1734 reduction. Appellee would have us import into our reading of the language of the relevant portions of the MVFRL his argument that the change here is a delivery or issuance of a policy. This Court is without authority to write new requirements into the MVFRL where the statutory language is without ambiguity.”

If you have any questions regarding your auto insurance policy, including the amount of your UM/UIM coverage, call DLP to schedule a free consultation.

John P. Finnerty, Esquire

In Brethren Mutual Insurance Company v. Cynthia McKernan, et al., the Superior Court of Pennsylvania ruled that an insurance company which provided home owner’s insurance to an insured was responsible to defend and provide coverage to a woman who fatally stabbed her boyfriend with respect to civil claims asserted by the boyfriend’s Estate against her. In addition, the Court held that the insurance company was responsible for satisfying a restitution award for funeral expenses ordered against the woman in the criminal proceedings against her arising out of the fatal stabbing.

Generally, intentional criminal acts will not be covered under a homerowner’s insurance policy. There is always an exclusion for such acts in homeowner’s insurance policies. However, in the McKernan case, the insured was not convicted of any intentional crimes as a result of the killing. Rather, she was convicted of reckless endangerment and simple assault by negligently causing bodily injury to another with a deadly weapon. The insured had grabbed a steak knife to defend herself from her abusive boyfriend. When she swung the knife intending to frighten her boyfriend away, she accidentally struck him in the chest and pierced his heart.

Because the insured’s actions were not intentional, the insured acknowledged that the insured’s conduct qualified as an occurrence under the policy language for which coverage was applicable. However, the the insurance company disputed whether it had an obligation to satisfy the restitution award of funeral expenses assessed against the insured by the judge in the criminal proceedings against her. The Court stated that the policy language did not limit claims to those made in the course of civil proceedings. The Court further held that a restitution award in a criminal proceeding qualifies as “damages” to which coverage is applicable under the policy.

As in any claim against an insurance company over coverage issues, the language of the policy will ultimately dictate the result. The Court’s decision in McKernan scrutinized the policy language in reaching its decision. McKernan is another decision from the Pennsylvania appellate courts in recent years which re-emphasizes a trend towards compelling insurance coverage for criminal conduct which results in serious injuries or death. The key component of these decisions is that coverage will only be found if the conduct was not intentional, although it can be criminal.

John P. Finnerty, Esquire

The Pennsylvania Supreme Court recently presided over oral argument on an appeal of a Superior Court decision that denied an estate’s claim for $1.15 million in UM/UIM coverage. The decedent in the case was a corporate executive who was killed while operating a company vehicle. The argument set for by counsel for the executive’s estate in Everhart v. PMA Insurance Group challenged the Pennsylvania General Assembly’s adoption of amendments to the state automobile insurance law 17 years ago. Those amendments require policyholders to provide waivers rejecting stacked UM/UIM coverage. The estate in the Everhart case argues that this action by the Assembly invalidates case law barring such coverage under corporate policies.

Does your homeowner’s insurance policy cover damages caused by flooding?  You should be aware of the answer to this question before a potential disaster strikes.  Don’t end up like so many of the victims of Hurricane Katrina who are faced with the disastrous problem of not having any insurance coverage to reimburse them for the damages they suffered to their homes and personal belongings.

In New Orleans, much of the damage was caused by the levees failing, not directly from the rain and wind of the Hurricane.  Several lawsuits were filed on behalf of victims of the levee flooding against their homeowner’s insurance companies.  Unfortunately, a Federal Court in Louisiana has ruled the insurance companies do not have to pay any claims because the policies provide a clear exemption of coverage for damages caused by flooding.  The victims will be appealing this decision.

If you reside in an area which could be flooded if a dam or a levee fails, your damages will only be covered if you have flood insurance.  Check your insurance policy for this coverage before a tragedy occurs.  Contact your insurance agent to confirm you have it and/or to obtain this coverage if you do not currently have it.

If you have any questions regarding your insurance policies or coverages, contact the DLP of Pennsylvania Personal Injury Attorneys for a free consultation.

John P. Finnerty, Esq.

In a ruling highly favorable to injured plaintiffs, in Sackett v. Nationwide Mutual Ins. Co., PICS Case No. 07-0594 (April 17, 2007), the Pennsylvania Supreme Court held that an insurance company is required to obtain a new executed waiver of stacking from from a named insured every time the named insured adds a vehicle to an existing auto insurance policy.  An insurance company’s failure to obtain a new executed waiver of stacking form signed by a named insured will result in the insured being deemed to have stacked UM/UIM coverage.  The policy will be deemed to provide stacked UM/UIM coverage even though the insured never paid for such coverage because the insured must be given an opportunity to waive stacked coverage. 

If you have been injured in a motor vehicle accident and have a question regarding the amount of UM/UIM coverage on your policy, contact DLP team of Pennsylvania Personal Injury Attorneys for a free consultation.

John P. Finnerty, Esquire  

According to a Delaware County Court of Common Pleas judge, a homeowner’s insurance carrier acted in bad faith when it failed to defend and indemnify its insured against a wrongful death and survival action stemming from a shooting death in which the insured pled guilty to voluntary manslaughter. Over $2 million in compensatory damage was awarded to the estate of the deceased and $6 million in punitive damages was awarded to the insured plus court costs and attorney fees.

In Pennsylvania National Mutual Casualty Insurance Co. v. Johnson, Duane Johnson and Sami Toler were involved in an altercation in which Toler was shot and killed.   A court accepted Johnson’s voluntary manslaughter plea and the estate of Toler filed a Wrongful Death and Survival complaint against Johnson alleging several reckless actions, one of which being Johnson did not intend to kill Toler.  When Johnson’s homeowner’s carrier Penn National was notified of the action, it denied the claim because the policy did not provide coverage for bodily injuries “expected or intended by the insured.”  This language is similar to standard exceptions found in most homeowner’s insurance policies which exclude coverage for intentional acts or harm caused by insureds. The insurer later filed a Declaratory Judgment action seeking a ruling that it never had a duty to defend or indemnify Johnson. The Court of Common Pleas denied the insurer’s complaint, finding the actions of Penn National to be “at best offensive, but at worst repulsive” and levying the $6 million punitive award in hopes it would “register in [the insurer’s] corporate conscience.”

This decision is in keeping with two recent decisions of the Pennsylvania Superior Court.  In Donegal v. Baumhammers (Pa.Super. Feb. 2006), a couple was sued for negligence after their mentally disturbed adult son murdered five (5) people and severely wounded another during a shooting spree in April 2000.  The couple’s insurance company denied coverage under their homeowner’s policy on the basis that the injuries and damages caused by the insured couple’s son were intentional acts.  However, the Pennsylvania Superior Court determined that the couple’s insurance company did have a duty to provide coverage because the couple’s conduct in failing to properly secure the guns in the house fell within the definition of an “occurrence” under the policy for which coverage applied. Similarly, in QBE Insurance Corp. v. M & S Landis Corp. (Pa.Super. 2007), a bouncer at Fat Daddy’s Nightclub smothered a man to death in the process of throwing the man out of the bar.  The man’s family then sued the bar for wrongful death.  The bar’s insurance company denied coverage based on an exclusion in the policy for intentional conduct in the nature of an “assault and battery”.  However, because the allegation against the bar was that it was negligent in the training and supervision of the bouncer, and this conduct would be considered an “accident”, such conduct qualified as an “occurrence” under the policy, thus triggering coverage.  The Court explained that although the most immediate cause of the man’s death was the bouncer’s intentional conduct, the bar’s negligent conduct can also be considered a cause of the man’s death.The lesson to be learned from the Johnson, Baumhammers and the M & S Landis Corp. cases is that just because the most immediate cause of injury or death may have been through an intentional act, there may still be insurance coverage available to pursue if there was a secondary cause of injury or death which facilitated the intentional conduct which could be characterized as negligent, reckless or accidental.  If you or loved one were injured due to the intentional or negligent conduct of another, we at DLP invite you to contact us for a free evaluation regarding whether you have a legitimate claim for damages.

John P. Finnerty, Esquire

Whenever anyone is seriously injured or killed as a result of another’s person’s conduct, intentional or negligent, one of the first questions to consider is whether the wrongdoer has insurance to pay for the damages and injuries he caused.  If the wrongdoer does not have any insurance coverage, most times it is not a claim worth pursuing as most individuals are judgment proof.

Usually, insurance companies write policies that exclude coverage for any injuries or damages that are caused by an insured’s intentional conduct.  However, two recent decisions of the Pennsylvania Superior Court determined that insurance coverage was available to the wrongdoers even though the injuries and damages they caused resulted from intentional conduct.

In Donegal v. Baumhammers (Pa.Super. Feb. 2006), a couple was sued for negligence after their mentally disturbed adult son murdered five (5) people and severely wounded another during a shooting spree in April 2000.  The couple’s insurance company denied coverage under their homeowner’s policy on the basis that the injuries and damages caused by the insured couple’s son were intentional acts.  However, the Pennsylvania Superior Court determined that the couple’s insurance company did have a duty to provide coverage because the couple’s conduct in failing to properly secure the guns in the house fell within the definition of an “occurrence” under the policy for which coverage applied.

Similarly, in QBE Insurance Corp. v. M & S Landis Corp. (Pa.Super. 2007), a bouncer at Fat Daddy’s Nightclub smoothered a man to death in the process of throwing the man out of the bar.  The man’s family then sued the bar for wrongful death.  The bar’s insurance company denied coverage based on an exclusion in the policy for intentional conduct in the nature of an “assault and battery”.  However, because the allegation against the bar was that it was negligent in the training and supervision of the bouncer, and this conduct would be considered an “accident”, such conduct qualified as an “occurrence” under the policy, thus triggering coverage.  The Court explained that although the most immediate cause of the man’s death was the bouncer’s intentional conduct, the bar’s negligent conduct can also be considered a cause of the man’s death.

The lesson to be learned from the Baumhammers case and the M & S Landis Corp. case is that just because the most immediate cause of injury or death may have been through an intentional act, there may still be insurance coverage available to pursue if there was a secondary cause of injury or death which facilitated the intentional conduct which could be characterized as negligent or accidental.  If you or loved one were injured due to the intentional or negligent conduct of another, we at DLP invite you to contact us for a free evaluation regarding whether you have a legitimate claim for damages.

John P. Finnerty, Esquire