APRIL 2018 BAD FAITH CASES: NO BAD FAITH WHERE INSURER HAD REASONABLE BASIS FOR INITIAL SETTLEMENT OFFERS (Philadelphia Common Pleas affirmed by Pennsylvania Superior Court)

The insured submitted a UIM claim to insurer following an auto accident. After an initial review of the evidence on the accident, and the insured’s medical records, the insurer offered $15,000 to settle the claim. Insurer later increased its offer to $20,000 then $25,000. The insurer’s final valuation was $28,000, but the insurer did not contact the insured about the final increased valuation because the insured unambiguously stated he would not settle for less than $50,000.

An arbitration panel awarded the insured $45,000, and he sued for bad faith. The insured argued the insurer acted in bad faith because its final settlement offer was only about 50% of the arbitration award, and because the insurer failed to notify him of the last increased $28,000 valuation.

The trial court awarded summary judgment to the insurer, holding these facts insufficient to prove the insurer’s offers lacked a reasonable basis. The court found the insurer’s “offers were not arbitrary low-ball offers but rather were the result of a considered analysis of the relevant information regarding [the] claim.”

In an unpublished decision, the Superior Court affirmed on the basis of the trial court’s well-reasoned opinion.

Dates of Decision: August 17, 2017 and April 4, 2018

Boleslavsky v. Travco Ins. Co., Court of Common Pleas of Philadelphia, October Term 2015, No. 886 (Aug. 17, 2017) (Anders, J.),

Affirmed by

Boleslavsky v. Travco Ins. Co., Pennsylvania Superior Court, No. 1227 EDA 2017, 2018 Pa. Super. Unpub. LEXIS 1065 (Pa. Super. Ct. April 4, 2018) (Gantman, McLaughlin, Platt, JJ.)