State Farm Mutual Automobile Insurance Co. v. Kelty

In 2013, the Delaware Supreme Court determined that Matthew Kelty was eligible for personal injury protection (PIP) benefits under an insurance policy between State Farm Mutual Automobile Insurance Company and John and Shirley Lovegrove after Kelty was injured in an accident involving the Lovegroves' vehicle. As a result, the Supreme Court reversed the Superior Court's earlier grant of summary judgment to State Farm and remanded the case for further proceedings. On remand, the parties argued about whether Kelty was entitled to receive only the statutory minimum of $15,000, or $100,000, including excess coverage the Lovegroves opted to pay for but which was expressly limited in the policy to the insureds and their relatives who lived with them. The Superior Court held that Kelty was entitled to receive the full $100,000 because the policy's limitation on who could benefit from the excess coverage was "void as against public policy." The Supreme Court reversed finding that the plain language of the statute, 21 Del. C. 2118, required PIP policies to provide only $15,000 of coverage. Imposing a higher minimum here simply because the Lovegroves chose to pay for additional coverage for themselves and their relatives "thwart[ed] Delaware's public policy to encourage drivers to purchase more than the statutorily-mandated minimum by increasing the cost of excess coverage.[. . .] It is not the role of the judiciary to alter that amount and thus disrupt the incentives that the General Assembly has itself set up for insurers and consumers. Accordingly, we reverse the judgment of the Superior Court." View "State Farm Mutual Automobile Insurance Co. v. Kelty" on Justia Law