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WALTER AND MARGARET BANKER v. VALLEY FORGE INSURANCE COMPANY (05/27/87)

filed: May 27, 1987.

WALTER AND MARGARET BANKER, INDIVIDUALLY AND AS PARENTS AND NATURAL GUARDIANS OF SHARON BANKER, A MINOR, APPELLANTS,
v.
VALLEY FORGE INSURANCE COMPANY, WAGNER AGENCY, INC., AND BERNARD RAFFERTY, APPELLEES



Appeal from Judgment of the Court of Common Pleas, Civil Division, of Dauphin County, No. 1431 S 1985.

COUNSEL

Pamela G. Shuman, Harrisburg, for appellants.

Bruce M. Mundorf, State College, for Valley Forge, appellee.

Christian S. Erb, Jr., Harrisburg, for Wagner, appellee.

Wieand, Beck and Cercone, JJ.

Author: Wieand

[ 363 Pa. Super. Page 458]

In this case an insured requested his broker to obtain an endorsement to his no-fault, automobile insurance policy which would reduce his premium by making his personal injury protection excess coverage over his private health care insurance. Several years after the endorsement had been issued, the insured's daughter was rendered a quadriplegic as a result of an automobile accident. The insured commenced an action to compel the insurer to pay past and future medical bills even though the health care insurance had not been exhausted. The basis for the action was an averment that the full effect of the endorsement had not been explained to him. The trial court sustained the insurer's preliminary objections in the nature of a demurrer and entered judgment in its favor. The insured appealed. We affirm.

In January, 1981, Valley Forge Insurance Company (Valley Forge) renewed an automobile insurance policy which had been issued to Walter Banker in accordance with Pennsylvania's No-fault Motor Vehicle Insurance Act.*fn1 In September, 1981, Banker's wife, Margaret Banker, contacted Bernard Rafferty, an agent employed by the Wagner Agency, Inc., and asked if it were true that the premiums of the policy could be reduced by making the family's private medical insurance the primary source of coverage in the

[ 363 Pa. Super. Page 459]

    event that a family member were to sustain injuries in an automobile accident. Rafferty responded affirmatively. Therefore, on September 29, 1981, Banker signed an application for an endorsement to his automobile policy which would provide that his personal injury protection was to be excess over any other hospital or medical expense coverage. The endorsement was issued and caused a subsequent reduction in the premiums paid by Banker. The endorsement was made a part of the policy and was listed, in bold-faced lettering, in the Schedule of Endorsements in the policy which the Bankers received from Valley Forge.*fn2

On February 23, 1983, Sharon Banker, the insured's minor daughter, was rendered a quadriplegic by injuries received in an accident involving a motor vehicle in which she had been riding as a passenger. The Bankers incurred substantial medical expenses and gave notice to Rafferty and the Wagner Agency, which, in turn, notified Valley Forge. Because of the excess coverage endorsement, however, the Bankers were instructed to submit their medical bills to their private health care insurer and were told that Valley Forge would pay only those bills for which the primary health care carrier denied coverage.

The Bankers commenced an action against Valley Forge and also against Rafferty and the Wagner Agency in which they sought to invalidate the excess insurance endorsement and compel payment of the medical bills incurred on behalf of their daughter. They alleged in an amended complaint that Valley Forge had failed to inform them that except for the endorsement they could have recovered from both insurers or retained the private health insurance lifetime maximum benefits for non-accident related bills. Valley Forge filed preliminary objections in the nature of a demurrer to the ...


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