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As Pennsylvania appellate courts continue to wrestle with issues related to stacked uninsured and underinsured motorist benefits, the state Superior Court has ruled that a woman who had begun to move some of her belongings out of her parents' house and into an apartment before her death in a motor vehicle accident no longer qualified as a "resident relative" under her parents' insurance policy and was therefore not entitled to stacked UIM coverage.

In Grix v. Progressive Specialty Insurance, a three-judge appeals panel unanimously ruled to affirm a Juniata County trial court's grant of summary judgment to an insurer who denied a claim for stacked UIM benefits by the parents of a woman who was killed in a motor vehicle accident.

Daniel and Cathleen Grix sought stacked UIM benefits from their insurance, Progressive Specialty Insurance Co., after their daughter Naomi Grix died in a car accident. The insurer denied the claim, however, finding that Naomi Grix had moved out of her parents' home about six weeks before her death and thus was not considered a "resident relative" under the policy. Instead, the insurer concluded, Naomi Grix was considered a "class two insured" who was not entitled to stacked benefits.

According to the appeals court's Feb. 10 nonprecedential opinion, the insurer based this determination on, among other things, the fact that, at the time of her death, Naomi Grix had begun making rental payments on a property with two roommates; was keeping clothing, jewelry, a toothbrush, art supplies and a laptop computer at that address; and was in the process of moving more of her belongings out of her parents' house and into her new property.

Daniel and Cathleen Grix, meanwhile, argued that, at the time of her death, Naomi Grix's driver's license still listed their address as her home address; she gave her employer her parents' address as her home address; and she had clothes, a toothbrush, art supplies, a guitar, a bed and a room, and received mail at their address.

But the Superior Court panel, led by Judge Alice Beck Dubow, sided with the insurer, finding that the plaintiffs "distorted the plain meaning of the policy provision to find an ambiguity."

"Instantly, two unambiguous provisions of the policy inform our understanding of appellants' reasonable expectations," Dubow said. "First, the policy unambiguously states that, for purposes of UIM benefits, an insured person is a relative, which the policy further defines as a person residing in the same household and related to the policyholder by blood. Naomi was not such a person.

"Second," Dubow continued, "the policy also unambiguously required appellants to notify appellee within 30 days of changes, including but not limited to, 'the residents in your household.' Appellants failed to notify appellee within 30 days that Naomi had moved out of their residence. Appellants now seek to benefit from their own failure to comply with the policy's notice provision and continued payment of premiums on Naomi's behalf by arguing that their failure should result in a benefit to them—stacked UIM coverage—but to which they are not entitled owing to Naomi's 'class two' status. Given the clarity and unambiguousness of the relevant policy provisions, we conclude that denying appellants stacked UIM benefits did not frustrate appellants' reasonable expectations."

Senior Judge James Gardner Colins joined Dubow's opinion and Judge Carolyn Nichols joined in the result.

The Superior Court also rejected the plaintiffs' argument that the policy was ambiguous because it did not articulate at what time a person must be a "resident relative" to be entitled to stacked UIM benefits.

"The parties' intent, as exhibited by the policy's terms regarding stacked benefits, indicate that the place of Naomi's residence at the time of the accident is the determining fact to appellants' entitlement to stacked benefits," Dubow said.

The appeals court likewise waved off the plaintiff's argument that Naomi Grix was a class one designated insured under the policy because her parents had listed her as a "driver and household resident."

"While Naomi was an insured person under the policy, it is undisputed that appellants did not list her as a named or designated insured on the declarations page of the policy," Dubow said. "Moreover, as discussed supra, Naomi was not a resident of the same household. Therefore, the trial court did not err in concluding that Naomi was not a 'class one' insured who would have been entitled to stacked benefits."

Counsel for Progressive, David Friedman at Forry Ullman in King of Prussia, could not be reached for comment.

Counsel for the plaintiffs, Scott Cooper of Schmidt Kramer in Harrisburg, said he plans to file a petition for allowance of appeal to the state Supreme Court on both the "resident relative" and designated insured issues.

Regarding the residency issue, Cooper said, "It seemed like the decision—and I don't think this is what the case law says—boiled down to where you're sleeping."

While residency is a dispute that arises from time to time, the more common issue that comes up in stacking cases is the question of what constitutes a designated insured, he added.

"That's an issue I've always litigated and have always wanted to litigate all the way up [to the Supreme Court]," he said. "People are named on policies all the time and they're not the named insured, they're not on the declaration sheet, but they're charged a premium."

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