State Farm Wins Auto Claim After Court Finds Insured Misrepresented Residency

insurance-fraud

ALLENTOWN, July 22 — A federal judge in Pennsylvania has entered judgment on the pleadings in favor of State Farm Fire and Casualty Co., finding that the denial of an automobile insurance claim was appropriate where the insured stated in his application that he resided in Pennsylvania when he in fact resided in New York.

U.S. Judge Lawrence F. Stengel of the Eastern District of Pennsylvania held that George A. Hancle’s statement regarding where he lived was a material item, and that State Farm would not have issued the policy if it was aware Hancle did not live in Pennsylvania.  Judge Stengel also found that State Farm relied on Hancle’s statement of residency.

State Farm issued an automobile policy to Hancle on Jan. 31, 2014, for his vehicle, a 2013 Nissan Pathfinder. On the policy application, Hancle said he lived in Pennsylvania and that his truck was kept in a garage there.  Hancle and his wife were involved in an accident in February of 2014 in Brooklyn, N.Y.

State Farm sued the Hancles and Nissan Motor Acceptance Corp.  in Pennsylvania federal court on Oct. 27, 2014, seeking a declaration it owed no coverage to Hancle because he made misrepresentations in the application and did in fact not live in Pennsylvana. Hancle did not submit a response to the complaint, and a default judgment was entered in favor of State Farm in June of 2015.

State Farm filed a motion for judgment on the pleadings in the fall of 2015, and the insured again failed to respond. Nissan Motor Acceptance Corp. a defendant in the declaratory judgment action, argued that the motion for judgment on the pleadings should not be granted because the state of Hancle’s residence was a genuine issue of material fact.

Judge Stengel disagreed, stating:

“There are no inferences left in this action to be drawn, and no material issues of fact to be resolved,” the judge concluded. “The well-pleaded factual allegations in State Farm’s complaint are considered admitted, and I accept them as true.”

State Farm Fire and Casualty Company v. Gregory A. Hancle, et al., No. 14-6140, E.D. Pa.; 2016 U.S. Dist. LEXIS 95084

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Author: CJ Haddick

C.J. Haddick is a Director with the law firm of Dickie, McCamey, & Chilcote, PC, based in Pittsburgh, Pa. He has advised and represented insurers in insurance coverage and bad faith litigation for more than a quarter of a century, and written and spoken throughout the United States on insurance coverage and bad faith prevention and litigation. He is Managing Director of the firm's Harrisburg, Pa. office. Reach him at chaddick@dmclaw.com or 717-731-4800.

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