In Rubin v. State Farm Mutual Automobile Insurance Company, the insured was in a motor vehicle accident when her car was struck from behind by another driver. She suffered various “potentially permanent physical injuries” from the accident, and she was insured by the insurer under a policy that provided underinsured motorist coverage. The insured reported the accident to the insurer soon after it occurred and made a timely claim for benefits under the policy. Soon after, the driver at fault offered a sum of money which the insured accepted. However, once the benefits from the settlement were exhausted, the insured’s injuries still were not fully compensated. She then filed a claim under her policy for underinsured benefits.
Under the policy, the insurer agreed to pay compensatory damages for bodily injury to an insured if the injury was caused by an accident that involves an underinsured motor vehicle. The insured allegedly failed to pay underinsured motorist benefits, and the insured filed a Complaint alleging, among other counts, breach of contract and bad faith.
Concerning the breach of contract claim, the court denied the insurer’s Motion to Dismiss. The insured had alleged that there was an existence of a contract between the two parties, and that the insurer unreasonably denied her underinsured motorist benefits under the policy. She also pled the existence of damages available if breach of contract was to be proven, so the court had no choice but to let the claim proceed.
With respect to the bad faith claim, the insured admitted after the insurer filed the Motion to Dismiss that her bad faith claim was “premature at this point.” She therefore amended her Complaint before the judge issued a ruling and struck the bad faith section. The court, as a mere formality, granted the insurer’s Motion to Dismiss the bad faith claim.
Date of Decision: January 7, 2011
Rubin v. State Farm Mut. Auto. Ins. Co., 10cv1651, United States District Court for the Western District of Pennsylvania, 2011 U.S. Dist. LEXIS 1613, (Jan. 7, 2011) (Schwab, J.)