NO PRIVATE ACTION UNDER UIPA; UTPCPL DOES NOT ENCOMPASS FAILURE TO PAY INSURANCE CLAIMS (Philadelphia Federal)

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In this underinsured motorist case, the insured brought claims for breach of contract, bad faith, unjust enrichment, violation of the Unfair Insurance Practices Act (UIPA) and violation of the Unfair Trade Practices and Consumer Protection Law (UTPCPL).  The carrier moved to dismiss all counts other than the statutory bad faith claim.

The court refused to dismiss the breach of contract claim, but did dismiss the UIPA and UTPCPL claims, as well as the unjust enrichment claim.

As to the UIPA claim, Eastern District Judge Baylson observed, “[t]here is no private right of action under the UIPA, which can only be enforced by the state insurance commissioner.” He chiefly relied upon Eastern District Judge Darnell Jones 2020 Clapps decision, summarized here. [Note:  The Clapps summary also includes a more general discretion on how Pennsylvania courts treat UIPA violations in the bad faith context.]

As to the UTPCPL claim, Judge Baylson states, that “an insured cannot bring a claim under the UTPCPL for a refusal to pay an insurance claim….” [Note also yesterday’s post, March 14, 2022, on Western District Magistrate Judge Dodge’s dismissal of a UTPCPL claim.]

Date of Decision:  February 25, 2022

Martin v. Liberty Mut. Ins. Co., U.S.  District Court Eastern District of Pennsylvania No. CV 21-4360, 2022 WL 580562 (E.D. Pa. Feb. 25, 2022) (Baylson, J.)