• United States District Court for the Middle District of Pennsylvania
  • January 31, 2019
  • Law Firm: - Office
  • No. 3:18-CV-1925

    Decided: December 10, 2018

    In alleging bad faith against Liberty Mutual, Plaintiffs plead nothing more than a disagreement as to the value of their claim. Liberty Mutual’s Motion to Dismiss was granted because Plaintiffs failed to plead adequate factual matter to support the allegation that Liberty Mutual did not act reasonably in valuing the underinsured motorist claim.

    Background

    Plaintiff, while operating her private vehicle, was involved in an accident off State Route 115 in Chestnut Hill Township, Pennsylvania. As Plaintiff attempted to enter a store parking lot, a vehicle, being drive by the tortfeasor, crossed over into Plaintiff’s lane of travel, striking her vehicle and causing her injuries. Plaintiff alleged, inter alia, that she sustained headaches, pain in her hips, back, neck, and shoulders, as well as a disc protrusion. Plaintiff eventually settled with the underlying tortfeasor for the policy limits of $15,000. Plaintiff then sought additional Underinsured (UIM) benefits from her policy with Liberty Mutual. Liberty Mutual refused to provide more in benefits as the claim was not worth more than that already received in the settlement.

    Plaintiffs alleged that by denying their claim for UIM benefits, Liberty Mutual breached the terms of their insurance agreement and acted in bad faith. Liberty Mutual moved for dismissal of the claim.

    Holding

    Plaintiffs’ subjective belief, as to the value of the claim, is not indicative of bad faith because a Defendant’s subjective belief as to value may reasonably, and permissibly, differ. The District Court held, absent additional factual allegations as to how Liberty Mutual acted unreasonably in their valuation of the claim, that Plaintiffs could not proceed on a bad faith claim on the basis of differing value only. Plaintiffs’ claim was therefore dismissed; however, the Court allowed leave to amend the Complaint to set forth additional factual allegations to support a claim for bad faith.

    Questions about this case can be directed to John Lucy, at (717) 441-7067 or [email protected]