In Estate of Gorg v. Great Am. Ins. Co., the parties disputed whether a provision in an insurance policy requiring that a claim under the insured’s policy must be brought within three years is controlling, despite a four-year Pennsylvania statute of limitations for breach of contract suits. This dispute arose as a part of an action for breach of contract and bad faith under a decedent’s life insurance policy.
In the Report and Recommendation (R&R), the Magistrate Judge held that the policy language is controlling and that such a time period is not manifestly unreasonable. He also ruled that the policy language was not in conflict with Pennsylvania law because the state permits parties to contract for a shorter limitations period.
Two months later, the District Judge adopted this ruling. The insured’s estate argued that the Magistrate Judge erred by failing to consider a rider in the policy, which stated that any time limit on the accidental death policy does not apply. Examining this claim, the court disagreed and found that the rider only applied to the distribution of benefits under the policy, not the time period in which a legal action arising from the policy must be commenced.
Date of Decision: May 25, 2012
Estate of Gorg v. Great Am. Ins. Co., No. 4:12-CV-0531, 2012 U.S. Dist. LEXIS 103639, U.S. District Court for the Middle District of Pennsylvania (M.D. Pa. May 25, 2012) (Smyser, M.J.)
Date of Decision: July 23, 2012
Estate of Gorg v. Great Am. Ins. Co., No. 4:12-00531, 2012 U.S. Dist. LEXIS 101891, U.S. District Court for the Middle District of Pennsylvania (M.D. Pa. July 23, 2012) (Kane, J.)