Background
Taylor Prichett was injured while riding in a family-owned vehicle driven with permission by her friend, Lillian Weeks. The vehicle was insured under a policy issued to Prichett’s parents and underwritten by Mid-Century Insurance Company. Prichett pursued a liability claim against Weeks and ultimately settled that claim for the policy’s $100,000 per-person liability limit.
Prichett also sued the insurer over its handling of the claim. Her remaining theories alleged statutory insurance bad faith under 42 Pa.C.S. § 8371 and deceptive conduct under Pennsylvania’s Unfair Trade Practices and Consumer Protection Law, commonly called the UTPCPL. She argued that her connection to the family policy and the adjuster’s conduct gave her enforceable rights despite the third-party posture of the liability claim.
The Bucks County court granted summary judgment to Mid-Century. The appeal required the Superior Court to distinguish a person insured for some purposes under an automobile policy from a third-party claimant seeking payment under the liability coverage applicable to the driver.
The Court’s Holding
The Superior Court affirmed in a nonprecedential memorandum. President Judge Emeritus Ford Elliott concluded that Prichett was not an insured under the liability portion of the policy for the claim she asserted against Weeks. In that posture she was a third-party claimant, and the insurer did not owe her the contractual duty of good faith that supports a Section 8371 action.
The court rejected the effort to derive standing from other portions of the policy or from Prichett’s relationship to the named insureds. The complaint did not present a first-party underinsured-motorist claim as the basis for the disputed handling. Because the relevant duty arises from the insurer’s contractual authority to control and settle claims for its insured, a claimant adverse to the insured cannot invoke that duty merely because she may qualify as an insured for a different coverage.
The UTPCPL theory also failed. Pennsylvania appellate decisions continue to hold that the consumer-protection statute does not create a claim against an insurer for claim mishandling. Decisions applying the UTPCPL liberally did not erase that insurance-specific boundary. With no genuine dispute about Prichett’s third-party status or the nature of the conduct challenged, summary judgment was proper.
Key Takeaways
- Standing under Pennsylvania’s bad-faith statute turns on insured status for the coverage and claim actually at issue.
- A passenger asserting liability against a permissive driver is ordinarily a third-party claimant under that liability coverage.
- Insured status under another section of the same policy does not automatically create a duty for the third-party liability claim.
- The UTPCPL remains unavailable when the challenged conduct is insurance claim handling rather than a separate consumer transaction.
Why It Matters
Prichett gives Pennsylvania insurance litigators a clean framework for mixed-status automobile claims. The same person may be an insured for first-party benefits or underinsured-motorist coverage yet remain a third party when asserting tort liability against another covered driver. Pleadings should identify the exact coverage, the contractual promise allegedly breached, and the capacity in which the claimant dealt with the carrier.
For policyholder and personal-injury counsel, the decision cautions against treating Section 8371 or the UTPCPL as a general remedy for difficult settlement negotiations. A viable bad-faith claim requires a duty owed under the relevant insurance relationship. Insurers, meanwhile, should avoid assuming that third-party status resolves every dispute; a separately pleaded first-party claim may produce a different analysis. Precision about coverage posture at summary judgment can prevent the parties from litigating duties the policy never created.
The procedural posture also matters when a passenger belongs to the named insured’s household. Counsel should separately analyze liability coverage, first-party medical benefits, uninsured or underinsured motorist coverage, and any assignment of rights. Those provisions can define “insured” differently. Combining them into a single generalized claim risks losing an otherwise viable contractual theory, while a coverage-by-coverage pleading lets the court identify which duties run directly to the claimant.