FEBRUARY 2013 BAD FAITH CASES: COURT DENIES CARRIER’S SUMMARY JUDGMENT MOTION ON BAD FAITH CLAIM, IN PART, BECAUSE CARRIER RELIED ON POLICE REPORT AND DID NOT SEEK ESTIMATE OF DAMAGES (Western District)

In Schifino v. Geico Gen. Ins. Co., the carrier moved for summary judgment, seeking to dismiss a breach of contract and bad faith claim brought by a third-party insured who was injured as a passenger in a car accident caused by an underinsured motorist (UIM). Following the accident, the third-party insured collected the liability limits of the tortfeasor’s policy and attempted to recover the $300,000 UIM limits of an automobile policy purchased by the driver of the vehicle in which he was injured. The carrier offered $10,000 and $13,000 settlements, which the third-party insured rejected.
He subsequently filed suit for breach of contract and bad faith, alleging that: (1) the carrier’s claims representative relied on a police report which stated that there was minimal damage to the vehicles; (2) the representative never requested photos of the vehicles or damage estimates; (3) the representative did not consider testimony that the tortfeasor was driving 40 miles per hour, causing the victims’ car to spin 90 degrees; and (4) that the accident caused $3,000 worth of damage to the vehicle. Examining these facts, the court denied the carrier’s motion, reasoning that the third-party insured alleged sufficient facts such that a reasonable juror could find that the carrier acted in bad faith.
Date of Decision: December 14, 2012
Schifino v. Geico Gen. Ins. Co., 2: 11-cv-1094, 2012 U.S. Dist. LEXIS 177072, U.S. District Court for the Western District of Pennsylvania (W.D. Pa. Dec. 14, 2012) (McVerry, J.)