JULY 2012 BAD FAITH CASES: COURT GRANTS SUMMARY JUDGMENT TO CARRIER WHERE DELAY WAS ATTRIBUTABLE TO INSURED’S ATTORNEY AND NOT CARRIER (Philadelphia Federal)

In Chemij v. Allstate Insurance Company, the court heard competing motions for summary judgment arising from allegations of bad faith in the handling of the insured’s underinsured motorist claim (“UIM”). The insured’s claim began when she was injured by a school bus operated by a local school district. After several attempts to return to work, the insured took a permanent leave of absence, sued the school district and filed a UIM claim.
The insured raised two primary issues that allegedly amounted to bad faith conduct by her carrier. She claimed that (1) the carrier acted in bad faith in its evaluation of her claim and in (2) the arbitration of the UIM claim. The court disagreed, granting the carrier’s motion it its entirety.
First, the insured contended that the carrier failed to investigate her claim promptly and thoroughly. However, most of the delay that occurred actually was caused by the insured’s own counsel. It took until 2009 for her attorney to send the carrier additional documents that it requested in 2007. Moreover, it took over a to schedule the insured’s statement under oath because of a lack of cooperation. Further, the carrier made an initial offer three months after first receiving the insured’s medical records and used several methods to evaluate the worth of the claim.
Second, the insured claimed that the carrier acted in bad faith during the arbitration of the UIM claim. Specifically, the insured claimed that the carrier should have sent a copy of the full policy upon request rather than just a copy of the declarations page. The court found that the carrier did not deliberately refuse to send a copy of the policy when originally asked and expedited the request when it was renewed by the insured’s attorney years later.
Therefore, the court rejected the insured’s claims and granted summary judgment to the carrier, holding that the insured did not meet her burden of proof.
Date of Decision: June 11, 2012
Chemij v. Allstate Ins. Co., No. 11-4106, 2012 U.S. Dist. LEXIS 80688, U.S. District Court for the District of Pennsylvania (E.D. Pa. June 11, 2012) (Schiller, J.)