Matthew A. Tighe and Laura M. Tighe, Petitioners
Michael F. Consedine, Insurance Commissioner for the Commonwealth of Pennsylvania, Respondent
Submitted February 13, 2015
Appealed from No. P13-12-019. State Agency: Insurance Commissioner of the Commonwealth of Pennsylvania.
Matthew A. Tighe and Laura M. Tighe, Pro se.
W. Christopher C. Doane, Department Counsel, Harrisburg, for respondent.
Michael J. Creme, Jr., Lancaster, for intervenor Donegal Mutual Insurance Company.
BEFORE: HONORABLE BONNIE BRIGANCE LEADBETTER, Judge, P. KEVIN BROBSON, Judge, ANNE E. COVEY, Judge.
P. KEVIN BROBSON, JUDGE
Matthew A. Tighe and Laura M. Tighe (the Tighes) petition for review of an order of Michael F. Consedine, Insurance Commissioner of the Commonwealth of Pennsylvania (Commissioner). The Commissioner upheld a determination of the Bureau of Consumer Services, Department of Insurance (Department), which denied the Tighes' challenge to the cancellation of their homeowners insurance policy by Donegal Mutual Insurance Company (Donegal). We affirm the Commissioner's order.
The facts, as found by the Commissioner and summarized below, indicate that the Tighes were dissatisfied with their prior homeowners insurance company. The Tighes asked Nathan Stein, an agent of Burns and Burns Agency, an independent insurance agency, to provide quotes for homeowners insurance from other insurance companies. Mr. Stein went to the Tighes' home and took photographs of the home. The home has a deck that is approximately fourteen feet above ground level at some points. After observing this, Mr. Stein contacted Mr. Tighe and informed him that the deck " was going to be an issue" and that the Tighes were " going to have to put up a railing." (Notes of Testimony (N.T.) at 165.) Mr. Stein also informed Mr. Tighe that an insurance company inspector would visit the property for the purpose of evaluating insurance coverage. Mr. Tighe responded to Mr. Stein's statements by relating an incident involving the deck when Mr. Tighe picked up a running toddler, because he was afraid that she might fall off the deck. Mr. Tighe also stated that he planned to install a railing. Mr. Tighe did not indicate to Mr. Stein a date by which he intended to install the railing.
Mr. Stein proceeded to issue a policy for Donegal, which the Tighes accepted. Burns and Burns then submitted the insurance application to Donegal, which included a notation that Burns and Burns was sending or emailing photographs of the property to the underwriter. Through an unexplained mishap, Burns and Burns did not send the photographs, and, consequently, when Donegal received the application, it was unaware of the condition of the deck and issued a policy. The policy became effective on June 19, 2013. In July 2013, Donegal's inspector, Patricia Dombroski, performed an inspection of the home. She sent a report to Donegal's underwriter, including a photograph of the deck and her observation regarding the height of the deck. Donegal's underwriter then determined that the condition of the deck without a railing constituted a hazard because of the injuries that could result from a fall from the deck. On August 13, 2013--approximately fifty-five days after the policy was issued--Donegal sent an email to Burns and Burns, indicating that the agency recommend to the Tighes that they install a railing by September 13, 2013, in order to avoid cancellation of the policy. The Tighes requested an extension of time to install the railing, and Donegal extended the deadline to October 13, 2013. On October 14, 2013, Donegal issued the cancellation notice, noting the Tighes' failure to comply with Donegal's demand for the Tighes to install the railing. (Certified Record (C.R.) at Tab A, Ex. 1.) The notice indicated that Donegal was cancelling the Tighes' insurance because Donegal determined that " [t]here is a substantial increase in hazards insured against by reason of willful or negligent acts or omissions by the insured." ( Id. )
On October 25, 2013, the Tighes requested the Department to review Donegal's cancellation. (C.R. at Tab A, Ex. 1A.) On December 3, 2013, a Department consumer services investigator issued a letter to the Tighes, concluding that Donegal satisfied the requirements of what is referred to as " Act 205," the Unfair Insurance Practices Act (Act), when it terminated the Tighes' insurance policy. (C.R. at Tab A, Ex. 2.) On or about December 3, 2013, the Tighes sent a letter to the Department's Bureau of Consumer Services, requesting a hearing. (C.R. at Tab A, Ex. 3.) On January 10, 2014, the Commissioner appointed a hearing officer, who conducted a hearing on February 27, 2014. (C.R. at Tab A, Ex. 6; C.R. at Tab J.) Following the submission of briefs, the hearing officer referred the matter to the Commissioner for adjudication.
On June 23, 2015, the Commissioner issued his adjudication. First, the Commissioner noted that the heart of this appeal concerns the Tighes' claim that Donegal's cancellation of their policy violated the Act, which prohibits unfair methods of competition and unfair or deceptive acts or practices. Section 5(a)(9) of the Act defines such acts to include, inter alia, the cancellation of a homeowner insurance policy that has been in force for sixty days or more, unless the insurer determines that there has been ...