Husband and wife plaintiffs allege their vehicle was involved in an accident, the damages resulting from the collision exceeded the amount of insurance recovered from the tortfeasor, that they made a claim to their insurer for underinsured motorist coverage, and that the insurer wrongfully and in bad faith denied coverage on the claim. The insurer argued Plaintiffs waived underinsured motorist coverage in a waiver, while Plaintiffs assert the waiver failed to comply with the applicable statute, making it ineffective.
Under Pennsylvania law, an insured must affirmatively reject underinsured coverage. To be effective, the signed rejection must contain the statutorily provided language. Furthermore, the rejection form must be placed on a separate sheet of paper in prominent type, and it must be “signed by the first named insured and dated to be valid.” If a purported rejection fails to comply with the statutory requirement, the underinsured coverage will be equal to the bodily injury liability limits.
Plaintiffs argued because the first named insured, the husband-plaintiff, did not date the form himself, but instead the date was printed in the header of the form, along with the names of the insureds and the policy number.
The Court rejected this argument, finding the most natural reading of the provision required the form be signed by the insured, but not that the insured also had to date the form. The Court found that had the legislature intended to require the insured to date the form, it could have phrased the statute in a way that clearly required it. Furthermore, the statute provides that the insured must be informed he may reject underinsured motorist coverage by signing the following written rejection form, but makes no mention of dating by the insured. Therefore, because plaintiff signed the form and it was dated the rejection was valid, and the Court dismissed the claims with prejudice.
Date of decision: December 10, 2014
Lieb v. Allstate Prop. & Cas. Ins. Co., Civil Action No. 14-4225, 2014 U.S. Dist. LEXIS 171359 (E.D.Pa. Dec. 10, 2014) (Rufe, J.).