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Can’t Stack That . . . Or can you? Federal Court in PA limits Stacking of Insurance Coverage (PA)

November 15, 2019

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<p class="x_MsoNormal" style="text-align: justify;"><span>In <em><a href="https://www.wcmlaw.com/wp-content/uploads/2019/11/Barnhart-v.-Travelers-Home-and-Marine-Insurance-Company.pdf">Barnhart v. Travelers Home and Marine Insurance Company</a><a href="https://www.wcmlaw.com/wp-content/uploads/2019/11/Barnhart-v-Travelers-Home-and-Marine-Insurance-Company.pdf"></a>,</em> plaintiff Mary Barnhart sought recovery of underinsured motorist (UIM) benefits after she was injured while a passenger on her husband’s motorcycle. After the motorcycle’s policy was tendered, Barnhart sought—and was denied—UIM coverage under a Traveler’s insurance policy she had purchased.</span></p>
<p class="x_MsoNormal" style="text-align: justify;"><span>U.S. District Judge Marilyn Horan of the Western District of Pennsylvania declined to extend <i>Gallagher v. Geico</i>, which held that members of the same household can stack their uninsured/underinsured insurance policies, so that if one member is in an accident, the coverage of other household members can be counted toward his or her claim. <i>Gallagher</i> further removed the “household exclusion” rule, which is a provision some insurance companies have prohibiting members of the same household from stacking their insurance policies unless every vehicle across the household is listed across every household policy.   </span><span>Judge Horan instead found that <i>Gallagher</i> did not apply, because the holding was limited to the household exclusion rule—while <i>Barnhart</i> dealt with a different exclusion entirely. She reasoned that <i>Gallagher</i> did not overrule <i>Williams v. Geico</i>, which upheld the regular use exclusion. </span></p>
<p class="x_MsoNormal" style="text-align: justify;">Ultimately, Judge Horan’s decision has likely opened the door to potential clarification by the Pennsylvania Supreme Court, as several cases in the Pennsylvania Courts of Common Pleas have extended <i>Gallagher</i> to apply to other exclusions. <i>See, e.g.</i>, <i>Rush v. Erie Insurance Exchange</i>, No. C-48-CV-2019-1979 (2019).</p>
<p class="x_MsoNormal" style="text-align: justify;">Thanks to John Lang for his contribution to this post.  Please email <a href="mailto:BGibbons@wcmlaw.com">Brian Gibbons</a> with any questions.</p>
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