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State Court Says Crash Victim was not Resident Relative, Denies Stacked Insurance

legal books with gavel on topAppeals courts in Pennsylvania continue to deal with cases involving stacking of uninsured and underinsured motorist (UIM) benefits in multiple policies. On February 10, a three-judge panel ruled in Grix v. Progressive Specialty Insurance that a trial court’s denial of stacked benefits for a deceased crash victim would be upheld.

The woman who died in the crash had started the process of moving things out of her parent’s house and was paying rent on another property before the accident that took her life. The trial court ruled she did not qualify as a resident relative because she was moving out, so she could not receive stacked UIM coverage.

The deceased woman’s parents took the case to court on her behalf, and were represented by Schmidt Kramer partner Scott Cooper, whose arguments before the Pennsylvania Supreme Court in Gallagher v. Geico resulted in a landmark decision about stacked insurance coverage.  

How the Case Started

The deceased woman’s parents were trying to obtain stacked coverage from Progressive Specialty Insurance Co., which denied the claim, saying their daughter had moved out approximately six weeks before the fatal crash.

The insurance company said the victim was paying rent on a property with two roommates and had personal property at this place, including clothing, art supplies, jewelry and a toothbrush.

The woman’s parents argued their daughter’s driver’s license listed their address, she still received mail at their address, had a guitar, bed, art supplies and her own room, and she listed her parent’s address as her home address in documents she filled out for her employer.

What the Superior Court Said

The Superior Court found the plaintiffs had “distorted the plain meaning of the policy provision to find an ambiguity.” The victim was a relative by blood but was not residing in the same household.

The insurance policy in question also required policyholders to notify the insurer of changes to the residents residing in the house. The lead judge on the panel said the parents were seeking to benefit from their failure to notify the insurer of the change and to stop paying premiums on their daughter’s behalf.

The court said the parents did not list their daughter as a named or designated insured on the declarations page of the insurance policy in question.

What is Next in this Case?

Cooper plans to file a petition for allowance of appeal to the state Supreme Court. He is disputing the court’s interpretation of resident relative and whether the daughter was a designated insured on the policy.

Residency sometimes comes up in insurance disputes, but the question of who is a designated insured comes up more often.

“That’s an issue I’ve always litigated and have always wanted to litigate all the way up [to the Supreme Court],” Cooper said.

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