IA&B applauds Blood v. Old Guard decision
Contact:
Karen Robison
(717) 795-9100, Ext. 606
MECHANICSBURG, Pa. – Insurance Agents & Brokers applauds the Pennsylvania Supreme Court’s recent decision to overturn the Superior Court’s decision in Blood v. Old Guard.
“This decision removes the potential for an overly burdensome requirement on agents to obtain additional forms from their insureds,” said Tom McElhaney, chairman of IA&B of Pennsylvania Inc.
In 2006 the Superior Court heard Blood v. Old Guard. The case involved an insured who purchased initial liability limits of $500,000, and in order to reduce his premiums, chose to lower his uninsured motorist/underinsured motorist limit to $35,000 and signed the proper election form. The insured later lowered his liability limits to $300,000 but did not make a selection for UM/UIM limits.
After amending the policy, the insured was in an accident and claimed that his reduction of liability limits triggered a need for a new written “sign-down” of UM/UIM coverage. He claimed that his UM/UIM coverage must be $300,000 per insured vehicle (or $900,000) since he did not sign a new “sign-down” form when he reduced his liability limit to $300,000. The Superior Court agreed.
The Supreme Court overruled this decision and held that a selection of UM/UIM limits at policy inception remains and is not affected by a change to another portion of coverage. The court ruled that the insured’s change of liability coverage did not constitute the issuance of a new policy but the modification of an existing one. Therefore, a new written selection of UM/UIM coverage was not necessary.
“This case prevents the need to obtain new UM/UIM selection forms every time an insured makes a policy change,” said McElhaney, “which is a win for agents across the Commonwealth.”
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About Insurance Agents & Brokers
Insurance Agents & Brokers of Pennsylvania Inc. provides professional development, advocacy and industry information to its nearly 1,300 member agencies. The organization is part of the Mechanicsburg, Pa.-based IA&B Service Group, which also includes trade associations in Delaware and Maryland.
Insurance Agents & Brokers of Pennsylvania Inc. is affiliated with the National Association of Professional Insurance Agents and the Independent Insurance Agents & Brokers of America.
To learn more, visit www.iabgroup.com.
