292 A.3d 866
Pa.2023Background:
- Robert and Kelly Franks obtained a multi-vehicle State Farm policy and signed written waivers rejecting stacked UIM coverage.
- They added a vehicle in Jan. 2014 and executed a new waiver; they removed a 1999 Ford Taurus from the policy in July 2014.
- Removal produced only a small prorated credit and a lower overall premium; coverage and premiums for the remaining vehicles were otherwise unchanged.
- No new waiver was requested or offered after the removal or when another vehicle was later substituted.
- After an August 11, 2016 accident by an underinsured tortfeasor, Franks claimed stacked UIM limits ($200,000); State Farm maintained the unstacked $100,000 limit.
- Trial court and Superior Court en banc sided with State Farm; Pennsylvania Supreme Court affirmed, holding removal (without acquisition or coverage change) is not a "purchase" under §1738(c).
Issues:
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does removing a vehicle from a multi-vehicle policy without changing remaining coverages or premiums constitute a "purchase" under 75 Pa.C.S. §1738(c) that requires a renewed stacking waiver? | Removal changes the available aggregate coverage and premium economics, so it is a "purchase" requiring a new waiver (Franks) | "Purchase" requires acquisition for payment; removal acquires nothing new and leaves remaining coverage/costs unchanged (State Farm) | Removal under these conditions is not a "purchase" under §1738(c); no renewed waiver required; unstacked $100,000 limit applies |
Key Cases Cited
- Barnard v. Travelers Home & Marine Ins. Co., 216 A.3d 1045 (Pa. 2019) (construed "purchase" by its plain meaning for §1738(c))
- Sackett v. Nationwide Mut. Ins. Co., 919 A.2d 194 (Pa. 2007) (addition of a vehicle can constitute a "purchase")
- Sackett v. Nationwide Mut. Ins. Co., 940 A.2d 329 (Pa. 2007) (clarification on application of Sackett I)
- Sackett v. Nationwide Mut. Ins. Co., 4 A.3d 637 (Pa. Super. 2010) (policy "finite" clause and waiver obligations)
- Shipp v. Phoenix Ins. Co., 51 A.3d 219 (Pa. Super. 2012) (vehicle substitution not a new "purchase")
- Pergolese v. Standard Fire Ins. Co., 162 A.3d 481 (Pa. Super. 2017) (distinguishing additions after removals from replacements)
- Everhart v. PMA Ins. Group, 938 A.2d 301 (Pa. 2007) (explaining stacking concept)