INSURANCE LAW

Somerset Legal Journal headnotes from approximately 1991 through the present.

For earlier cases, please visit the Somerset County Law Library.

 

BAD FAITH CLAIMS

 

The issue of "bad faith practice and pattern discovery" is one that has not been extensively litigated.  Field v. Nationwide Mutual Insurance, 54 Som.L.J. 314 (1997) (Cascio, J.) 

 

Because it would be difficult to show a practice or pattern of bad faith relying solely on one cause, the plaintiff's request for information concerning other bad faith actions against the defendant within the last five years in the state of Pennsylvania is a valid and worthwhile request, especially in light of the fact that the request is limited to a specific time frame, narrow in scope, and relevant to her claim.  Field v. Nationwide Mutual Insurance, 54 Som.L.J. 314 (March 18, 1997) (Cascio, J.) 

 

42 Pa. C.S.A. § 8371 permits the court to award relief for "bad faith," but only if that "bad faith" was against the insured.  Feathers v. Reliance Ins. Co., 55 Som.L.J. 1 (October 3, 1997) (Fike, P.J.)

 

The bad faith statute does not give relief to an insured who alleges that his insurer engaged in unfair or deceptive practices in soliciting the purchase of a policy.  The statute is concerned with the duty of good faith and fair dealing in the parties’ contract and the manner by which an insurer discharged its obligations of defense and indemnification in the third-party claim context or its obligations.  Laurel Mountain Ski Company v. Tudor Insurance Company, 65 Som.L.J. 1 (2010) (Klementik, J.).

 

MOTOR VEHICLE FINANCIAL RESPONSIBILITY ACT

 

An individual listed as a "driver" in an insurance policy does not have the status of a "named insured" under 75 Pa.C.S.A. § 1702.  Metheney v. King, 54 Som.L.J. 50 (August 8, 1995) (Shaulis, S.J.) 

 

Where the language of a statute is clear and unambiguous, it is to be enforced and not convoluted under the guise of pursuing the spirit of the law.  Metheney v. King, 54 Som.L.J. 50  (August 8, 1995) (Shaulis, S.J.) 

 

An individual who is not related to, nor in the custody of a "named insured" at the time of the accident, is neither insured under the terms of the insurance policy, nor insured under the provisions of Section 1702 of the Pennsylvania Motor Vehicle Financial Responsibility Law.  Metheney v. King, 54 Som.L.J.50  (August 8, 1995) (Shaulis, S.J.) 

 

Health insurance benefits fall within the definition of "program, group contract or other arrangement for payment of benefits" as defined in 75 Pa. C.S.A. § 1719, and therefore in a suit against a third party tortfeasor, a plaintiff is precluded under 75 Pa. C.S.A. § 1722 from recovering medical expenses paid by the plaintiff's private health insurance carrier.  Frontini v. Phillippi, 54 Som.L.J. 291 (February 24, 1997) (Fike, P.J.) 

 

Medicare benefits fall within the definition of "program, group contract or other arrangement for payment of benefits" as defined in 75 Pa. C.S.A. § 1719.              Frontini v. Phillippi, 54 Som.L.J. 291 (February 24, 1997) (Fike, P.J.) 

 

Because compliance with both section 1720 of the MVFRL, regarding subrogation, and 42 U.S.C.S. § 1395y(b)(2) of the Medicare statute is impossible, federal law preempts state law regarding subrogation for repayment of medicare benefits in a suit against a third party tortfeasor.  Frontini v. Phillippi, 54 Som.L.J. 291 (February 24, 1997) (Fike, P.J.) 

 

In a MVFRL case, a plaintiff will be permitted to introduce evidence of medical bills and expenses paid by Medicare, and to recover those amounts, because Medicare is entitled to reimbursement or subrogation for medical payments conditionally made to a plaintiff.  Frontini v. Phillippi, 54 Som.L.J. 291 (February 24, 1997) (Fike, P.J.) 

 

UNFAIR INSURANCE PRACTICES ACT

 

When the complained-of conduct falls within the purview of the Unfair Insurance Practices Act, the complaint must aver more than mere contractual nonfeasance; it must aver fraudulent conduct, such as an unfair method of competition or unfair or deceptive act or practice, as defined in the Unfair Trade Practices and Consumer Protection Law, 73 P.S. 201-2(4)(xvii).  Mutual Benefit Ins. Co. v. Coon, 50 Som.L.J. 128

 

While the Unfair Insurance Practices Act, 40 P.S. § 1171.1 does not provide for a private cause of action, the definition of "unfair practices" in the Act may provide the basis for a cause of action under the Unfair Trade Practices and Consumer Protection Law, 73 P.S. § 201-9.2 or 42 Pa. C.S.A. § 8371.  Feathers v. Reliance Ins. Co., 55 Som.L.J. 1 (October 3, 1997) (Fike, P.J.)