PENNSYLVANIA MOTOR VEHICLE FINANCIAL …

1 PENNSYLVANIAMOTOR VEHICLEFINANCIAL RESPONSIBILITYLAWM ichael P. McKenna, EsquireHARRISBURG Box 932 Harrisburg, PA 17106-0932717-975-8114 PITTSBURGH OFFICE525 William Penn PlaceSuite 3300 Pittsburgh, PA 15219412-281-4256 SCRANTON OFFICE220 Penn AvenueSuite 305 Scranton, PA 18503570-342-4231 MARGOLIS EDELSTEINM ichael P. McKenna, EsquireThe Curtis Center, 4th FloorIndependence Square WestPhiladelphia, PA 19106-3304(215)922-1100 FAX PA Box 628 Hollidaysburg, PA 16648814-224-2119 WESTMONT Box 2222216 Haddon AvenueWestmont, NJ 08108-2886856-858-7200 BERKELEY HEIGHTS OFFICE300 Connell DriveSuite 6200 Berkeley Heights, NJ 07922908-790-1401 WILMINGTON OFFICE750 South Madison StreetSuite 102 Wilmington, DE 19801302-888-1112 MOTOR VEHICLE FINANCIAL responsibility LAWTABLE OF PARTY of of of of of of 's MOTORIST of of of of of CLAIMS of of OF FINANCIAL for Failure to Maintain FINANCIAL Offer of Liabilityand UM/UIM 10 of of Tort Tort Statute of Jersey Tort ON INSURANCE Cause of of of STATUTORY VEHICLE Insurance Fraud (Criminal Provisions).

2 VEHICLE Insurance Fraud (Civil Provisions).. Under the Influence - Commercial of Pleadings and A Quick Comparison: MVFRL Policies Before andafter July 1, 1990 APPENDIX BMotor VEHICLE FINANCIAL responsibility Law(effective July 1, 1990)APPENDIX CAutomobile Insurance Medical Cost ContainmentRegulations (11/30/91)APPENDIX DSerious Impairment of Body FunctionAPPENDIX EPunitive Damages in Insurance LitigationAPPENDIX FInsurance Department Statements of PolicySubchapter B - Forms (7/1/90)Subchapter C - Rate and Rule Filings (7/1/90)Subchapter D - Insurance Availability andConsumer Protections (7/1/90)Subchapter E - Anti-Fraud Provisions (7/1/90)Subchapter F - 1992 Rates (5/11/91)Revised 10/061 MOTOR VEHICLE FINANCIAL responsibility ( 1701) MOTOR VEHICLE FINANCIAL responsibility Law, 75 Pa. , et DateThe MVFRL as originally enacted applies to all policiesissued or renewed on or after October 1, 1984.

3 EffectiveJuly 1, 1986, 1724 "Certain Nonexcludable Conditions" wasadded. Effective December 12, 1988, 1761 to 1769"Catastrophic Loss Trust Fund" were repealed. EffectiveJune 1, 1989, 1715 "Availability of Adequate Limits" wasamended to provide for extraordinary medical benefitcoverage. 6 Amendments:The most recent Amendments to the MVFRL, though all signed into law on February 7, 1990, have varying effective dates as follows: (a) 1702 "Definitions" amended effective February 7,1990.(b) 1705 "Election of Tort Options" amended effectiveFebruary 7, 1990, but only applies to policies issued orrenewed on and after July 1, l990.(c) "Disclosure of Premium Charges and TortOptions" amended effective February 7, l990 but onlyapplies to policies issued or renewed on and after July 1,l990.

4 (d) "Rates" amended effective February 7, l990but freezes private passenger MOTOR VEHICLE rates atDecember 1, 1989 levels. Requests for new rates applicableto policies issued on or after July 1, 1990 must be filedon or before May 1, :Note the savings provision which extended theotherwise repealed CAT Fund benefits after June1, 1989 for accidents occurring before June 1,1989 applies only to the owner of the insuredvehicle, not to a spouse or relatives in thehousehold. Bumberger v. Ins. Dept., Pa., 948 (1994).Revised 9/942(e) "Examination of VEHICLE Repairs" amendedeffective in 60 days. ( , April 8, 1990)(f) "Conduct of Market Study" amended effectivein 60 days. ( , April 8, 1990)(g) "Conduct of Random Field Surveys" amendedeffective in 60 days. ( , April 8, 1990)(h) 1797 "Customary Charges for Treatment" amendedeffective April 15, 1990.

5 (i)All remaining Amendments to MVFRL are effective July1, 1990 for policies issued or renewed on or after ' Compensation Amendments:A workers' compensation reform statute was signed into lawon July 2, 1993. Although dealing primarily with changesto the PENNSYLVANIA Workers' Compensation statute, thereform bill also affected four sections of the MVFRL asfollows:(a) 1735 and 1737 of the MVFRL dealing with workers'compensation immunity issues in UM/UIM claims, are repealedin their entirety as of July 2, 1993. (b) 1720 and 1722 of the MVFRL, dealing withsubrogation and admissibility of evidence, respectively,are modified effective August 31, 1993. The references toworkers' compensation benefits in the sections are deleted,presumably restoring a workers' compensation right ofsubrogation in automobile accident cases and alsopermitting evidence of medical and wage damages alreadycovered by workers' :The amendments are substantive, not procedural,and will not be given retroactive effect.

6 Broganv. WCAB, Pa. Cmwlth., 637 689 (1994),Carrick v. Zurich American Ins. Co., 14 907(3d Cir., 1994). The compensation carrier'sright to subrogation is governed by the date ofaccident, not by the date of the compensationpayments. Schraeder v. Schroeder, Pa. Super.,682 1305 (1996). ( 1702)Among the definitions provided in the revised statute are: Revised 1 responsibility :The ability to respond in damages for liability on accountof accidents arising out of the maintenance or use of amotor VEHICLE in the following amounts: (a)$15,000 for bodily injury to one person in any oneaccident; (b)$30,000 for bodily injury to two or more personsin any one accident; (c)$5,000 for property damage for any one accident. NOTE:Guiding or directing a VEHICLE that is beingoperated by another is not maintenance or use ofa MOTOR VEHICLE .

7 Belser v. Rockwood Ins. Co.,Pa. Super., 791 1216 (2002). :Accidentally sustained bodily harm to an individual andthat individual s illness, disease or death :"Injury" as defined in the statute does notinclude mental injury which is not the result ofbodily injury. Zerr v. Erie, Pa. Super., 237 (1995). As a result, mental oremotional distress from witnessing injury to afamily member does not itself qualify as"injury." Jackson v. Travelers Ins. Co., , 606 1384 (1992). A carrier may,however, provide broader coverage than the MVFRL requires. If a policy defines injury to includedisease or illness without a prerequisite accidentally sustained bodily harm, thentreatment for such mental or emotional distressis covered. Glikman v. Progressive, Pa. Super.

8 , (2007). 3. Insured:(a)An individual identified by name as an insured in apolicy of MOTOR VEHICLE liability insurance; NOTE:An individual listed only in the "named drivers"section of the policy does not qualify as a"named insured." Stump v. State Farm, , 564 194 (1989), Caron v. RelianceIns. Co., Pa. Super., 703 63 (1997). Revised 4/07 NOTE: First named insured literally means the firstname listed on the policy even if the insurer byerror failed to list the applicant ( theperson who requested coverage and filled out theapplication) first. Jones v. Prudential, , 856 838 (2004).NOTE:If the Named Insured is a partnership, then theindividuals comprising the partnership are alsoNamed Insureds when acting in their capacities aspartners. Continental Casualty v. PRO Machine,Pa.

9 Super., (2007).(b)A spouse or other relative if resident in thehousehold with the named insured; NOTE:Absent policy definition of "resident in thehousehold," that phrase may include part timeresidents. Toplin v. Pennland Ins. Co., (1997). In a homeowner's coverage context,a relative who from time to time visits or staysat the residence does not through such temporaryarrangements qualify as a "resident in thehousehold." McNally v. Republic Ins. Co., , 718 301 (1998).NOTE:Policy language may not restrict resident of thehousehold insured status to those occupying aninsured auto. Prudential v. Colbert, Pa., 747 (2002).NOTE:In PNC Bank v. WCAB, Pa. Cmwlth., 831 1269(2003), the court announced prospectively as of9/17/03 that PENNSYLVANIA no longer recognizescommon law marriages and that marriages must beentered into pursuant to the Marriage Law.

10 InCostello v. WCAB, Pa. Cmwlth., (2007),however, the court announced that the effectiveprospective date for abolishing common lawmarriages is 1/1/05, the effective date of anamendment to the Marriage Law on this :A spouse does not qualify as an "insured" underher husband s employer s commercial auto policywhere the husband is not identified as a namedinsured under the policy. Hunyady v. Aetna, , 578 1312 (1990), Northern Ins. Resinski, Pa. Super., 827 1240 (2003).Revised 4 :The statutory definition of "insured" applies toindividuals, not corporations (which do not havespouses or relatives). That the same policylanguage is used for individuals and corporationsdoes not render the policy ambiguous and does notcreate coverage that would otherwise not Company of Evanston v. Bowers, , 758 213 (2000).