The UIM victim received income loss benefits from his own private disability policies, a work disability policy, as well as SSA disability benefits. A lawsuit was filed against the truck driver. After the case was settled, an underinsured motorist claim was made against Nationwide. The insurance company argued at a Bucks County UIM hearing that the UIM victim’s recovery should be reduced by all the disability benefits he had received from the non-automobile insurance sources.
The Pennsylvania Superior Court affirmed the Trial Judge’s decision. However, on appeal, the PA Supreme Court interpreted the Pennsylvania Motor Vehicle Financial Responsibility Law as requiring a set-off for any benefits received by the injury victim even though the insurance company never paid for those supplemental benefits, nor reduced the UIM premiums to reflect a reduced risk on their part. The only exception noted was in a situation when the private insurance provider is entitled to make a subrogation claim against the UIM benefits. Tannenbaum v. Nationwide Ins. Co., 992 A.2d 859 (Pa. 2010)
