New West Virginia UM Case

There is a new case out in West Virginia that is worth talking about to underscore the differences between West Virginia law and Maryland law. I think the intuition of most victims – and some lawyers – would be that West Virginia law makes more sense and is likely “the way it is.” But the Maryland law is very different.

The plaintiffs were in a car accident. At-fault driver had a $25,000 policy. One plaintiff, the wife, had almost $30,000 in medical bills. Nationwide Insurance offered up the $25,000 policy on behalf of the at-fault driver to that plaintiff.

Thankfully, the plaintiff also had a $250,000 uninsured/underinsured motorist policy with State Farm. When negotiating the underinsurance claim, State Farm argued they should get a credit for the $5,000 that they paid the plaintiff in PIP. Besides the fact that State Farm likes being difficult, they had another basis: West Virginia law. Apparently, West Virginia has a “non-duplication” provision in an insurer’s underinsured motorist (UIM).

The trial court believes this violated West Virginia’s uninsured motorist statute. I agree. (I do that without looking. How tricky!) But the West Virginia Supreme Court of Appeals reversed, finding that a non-duplication” of benefits provision in a WV underinsured motorist policy does not violate the “no sums payable” language in the underinsured motorist coverage statute.

This type of provision absolutely would be in violation of Maryland law. Personal injury protection insurance is a collateral source in Maryland and there can be no law that creates a set off for PIP monies recovered.

I’m impressed by the plaintiffs’ lawyer here who heard State Farm talk of using the PIP as a set-off and filed a declaratory judgment action regarding this non-duplication provision. Good hustle in a loss.

You can find the court’s opinion in State Farm v. Schatken here. Everyone and their mother briefed this case. You can find those briefs here.