Scott Cooper of Schmidt Kramer is representing the plaintiff in Erie Insurance Exchange v. Mione, a case that could further define limits on the 2019 Gallagher v. Geico case.
Gallagher invalidated household vehicle exclusions in car insurance policies and the Supreme Court later ruled this decision is retroactive for other cases. In the new case, the defense for Erie Insurance Exchange is arguing Gallagher does not apply because the victim did not have uninsured motorist (UIM) coverage in his motorcycle insurance policy. The vehicle was covered by a Progressive Insurance Co. policy, but UIM coverage had been waived.
However, Cooper argued that even if this is not an insurance stacking case, the policy provision preventing Mione from recovering compensation is invalid. Cooper said the Motor Vehicle Financial Responsibility Law section about priority of recovery entitles Mione to see compensation from Erie Insurance Exchange.
However, the attorney for the insurance company says that unless stacking is involved in the insurance claim, the Gallagher decision cannot bar the exclusion. This is the same argument that was made by the Superior Court.
The defense also argued that if Mione’s appeal succeeds, people who buy insurance would have an incentive to buy less coverage.
Two of the justices have concerns about whether ruling in favor of Mione would cause people to buy cheaper insurance for some vehicles. They would do this because they may expect to have more robust coverage from another vehicle’s policy.
Justice David Wecht warned about this type of problem in his dissent in the Gallagher case. He wrote that the majority’s decision would bar enforcement of any exclusion that prevents stacked UIM or underinsured motorist benefits.
It is important to note that since the Gallagher decision, other cases have gotten into the appeals courts that bring up questions about when exclusions are allowed. The Pennsylvania Supreme Court has agreed to hear another case involving an insured person challenging a regular use exclusion.