State Farm Mutual Auto Insurance Stacked UIM Payout Pennsylvania Class Action

Norman Stanton was riding his Kawasaki motorcycle near the entrance to a Wawa when he was hit from behind by another vehicle. The driver of the other vehicle had insufficient coverage to pay for his injuries. The complaint for this class action alleges that Stanton’s stacked uninsured motorist coverage with State Farm Mutual Automobile Insurance Company should pay out for his injuries, but State Farm is refusing to pay.

The class for this action is persons who were injured in motor vehicle accidents between 1990 and the present because of the actions of an uninsured or underinsured motorist, and who were insureds under State Farm auto policies with uninsured or underinsured motorist

Stanton’s injuries in the July 29, 2019 accident were multiple and severe. The complaint names, to begin with, “traumatic brain injury, spinal fractures, facial fractures, internal injuries, subdural hematoma,” along with others.

According to the complaint, the other vehicle was at fault, but its Bristol West Insurance Company policy only had $25,000/$50,000 in liability coverage. He received the $25,000, but it was not enough to compensate him for the extent of his injuries. He then turned to his own uninsured/underinsured motorist (UIM) coverage.

At the time of the accident, the complaint says, Stanton had on policy with State Farm, “providing $15,000/$30,000 in stacked underinsured motorist coverage for three (3) vehicles in accordance with” Pennsylvania’s Motor Vehicle Financial Responsibility Law (MVFRL). Stanton also had a fourth policy with State Farm with $15,000/$30,000 in stacked underinsured motorist coverage for one vehicle.

A November 11, 2019 letter to Stanton from State Farm indicated that, with the stacking coverage of four vehicles, “there is a total of $60,000 in UIM benefits available.” A November 19 letter from State Farm confirmed that amount.

However, a letter dated April 22, 2020 stated that the company “may have no duty to pay” Stanton’s claim because of an exclusion. The letter quoted the exclusion as saying, “THERE IS NO COVERAGE FOR AN INSURED WHO SUSTAINS BODILY INJURY WHILE OCCUPYING A MOTOR VEHICLE OWNED BY THAT INSURED IF THE VEHICLE IS NOT INSURED FOR UNDERINSURED MOTOR VEHICLE COVERAGE UNDER THIS POLICY OR ANY OTHER POLICY.

A July 30 letter the suggested that Stanton had not registered or owned the vehicle at the time of the accident and that, if so, there was no UIM coverage.

According to the complaint State Farm has refused to pay the coverage based on “the above noted household exclusion…”

The complaint alleges that the Supreme Court of Pennsylvania “held that household exclusion in automobile policies issued in Pennsylvania in accordance with the MVFRL are invalid and unenforceable.” This means, it claims, that State Farm’s disclaimer of coverage is void and unenforceable.

Article Type: Lawsuit
Topic: Insurance
Tags: Auto Insurance, Denial of Benefits, Insurance, UM/UIM Coverage