February 21, 2012 – The Pennsylvania Supreme Court, in answering a certified question of law from the 3rd Circuit, has held that under the MVFRL an uninsured driver injured in an MVC with an insured driver can sue in tort for economic damages. In the case of Corbin v. Khosla, the Court has answered a question that accounted for some tension in prior precedents, that being- Can a driver who violates the MVFRL by failing to secure insurance still proceed with a tort claim for economic losses? In their decision, the Court makes it clear that a driver can proceed with such a claim.
The tension in this area stems from the fact that the MVFRL prohibits an uninsured driver from recovering first-party benefits but also defaults such drivers to "limited tort" status which would allow them to pursue economic damages in tort against a negligent party. In addressing this apparent inconsistency, the Court determines that while the provisions of the MVFRL preventing a driver who fails to secure insurance from obtaining first-party benefits are sound, that such provisions cannot absolve a negligent party from responsibility for the damages it causes, even if such damages constitute economic losses that would normally be compensable as first-party benefits.
In its' decision, which was apparently supported by the Insurance Commissioner, the Court concludes that the punishment set upon an uninsured driver preventing him/her from getting no-fault first-party benefits do not extend to tort actions against negligent parties. Of course, in such a claim the issue of fault must now be shown along with the costs, time, etc. of litigating a claim for damages that, had the person purchased insurance, they would have received quite simply. One issue that the Court did not address that comes to our mind is whether the uninsured driver who brings suit for those economic losses must give the negligent party some form of credit or offset for the first-party benefits they could have obtained had they been insured. Perhaps this issue will be decided down the road but, until it is, we feel certain that the auto carriers will argue they are so entitled. To read the full decision please click here.
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