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UIM Coverage Limitation Held Consistent With The MVFRL And Pennsylvania Public Policy
May 19, 2022
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In <em><a href="https://www.wcmlaw.com/wp-content/uploads/2022/05/Meyers-v.-Travelers.pdf">Meyers v. Travelers</a>,</em> the Eastern District of Pennsylvania recently held that non-stacked underinsured motorist (“UIM”) coverage limiting recovery to the highest applicable limit of any other second-priority policy was consistent with the stacking waiver statute under Pennsylvania’s Motor Vehicle Financial Responsibility Law (MVFRL), and with Pennsylvania public policy.
The plaintiff in that case suffered severe injuries when her vehicle was struck by another car. She filed insurance claims under six different policies and first received $100,000 from the at-fault driver’s policy. That amount did not cover her injuries, so she sought to recover UIM benefits. At the time of the accident, the plaintiff was the named insured on four policies that offered UIM benefits, and she received a total of $1.6 million in stacked benefits from these carriers.
However, the sixth policy on which Meyers could make a UIM claim - issued by Travelers to plaintiff’s mother - did not allow for stacked benefits due to an “other insurance” clause in the policy. This clause implemented a stacking waiver made by plaintiff’s mother when the policy was issued, thus limiting plaintiff’s UIM coverage to $85,000 of the policy’s $300,000 limit. Plaintiff filed a motion for summary judgment, arguing that the “other insurance” clause of the Travelers policy was void and unenforceable under the MVFRL.
The court disagreed, finding that limiting recovery to the highest applicable limit for any one vehicle under a second priority policy was consistent with the staking waiver statute. The court also held that the MVFRL provision making insurers “wholly responsible” did not entitle an insured to certain coverage. Finally, the court held that the decrease in Travelers’ exposure was consistent with Pennsylvania public policy as it was the result of plaintiff’s mother having voluntarily waived stacking and obtaining a lower premium as a result.
Thank you to Mason Bailey for his contribution to this post. Please contact <a href="mailto:agibbs@wcmlaw.com">Andrew Gibbs</a> with any questions.