Uninsured Motorist (“UM”) claims are subject to the four-year Statute of Limitations for contract claims. The claim accrues when an insured is: 

  1. involved in a motor vehicle accident;
  2. injured in the accident; and
  3. knows or reasonably should have known of the uninsured status of the owner or operator of the other vehicle involved in the incident.  

In a recent decision by Judge Schiller in the matter styled Liberty Mutual Fire Insurance Company v. Weisbaum, October 5, 2011, the issue arose as to whether Weisbaum timely prosecuted his claim for UM benefits before the Statute of Limitations expired. The accident occurred on June 25, 2004. Correspondence in early July, 2004 from Mr. Weisbaum’s counsel notified Liberty Mutual of the accident and said there may be a basis for UM or Underinsured Motorist (UIM) coverage. On June 23, 2006, Weisbaum actually sued the operator of the other vehicle involved in the accident and the vehicle’s owner for damages, that case being terminated as inactive on July 7, 2009. In fact, in September, 2006 Weisbaum submitted to an Examination Under Oath taken by Liberty Mutual for purposes of the UM claim.  

Liberty Mutual asserted that the Statute of Limitations ran on Weisbaum’s UM claims given that it accrued on July 1, 2004 when Weisbaum knew or should have known that the owner/operator of the other vehicle was uninsured, the very date when his attorney sent notice of a possible UM claim and gave a recorded statement. Liberty argued that the four-year Statute of Limitations expired on July 1, 2008.  Weisbaum claimed that he could not confirm the owner or operator of the other vehicle was uninsured until he filed the lawsuit on June 23, 2006 so he had until June 23, 2010 to assert UM claims. The parties agreed that the Statute of Limitations as of 2011 had run on Weisbaum’s claim. Weisbaum argued however that the Statute of Limitations was tolled (stopped) when the parties took steps to have the matter arbitrated, i.e. there was a new implied contract to arbitrate the case. 

Judge Schiller said Weisbaum’s arguments failed because he never filed a Petition to Compel Appointment of Arbitrators other legal proceedings against Liberty Mutual. Weisbaum further asserted that the parties’ appointment of Arbitrators gave rise to an inference that there was a demand for Arbitration. The Court found that even if he had made such a demand that is not enough to toll the Statute of Limitations. Hence, the Court also relied on a precedent that appointment of an arbitrator does not toll the Statute of Limitations on an UIM claim and correspondence with the insurance company does not toll the Statute of Limitations on UM claims under Pennsylvania law. The Court found that Liberty Mutual had actively sought to obtain information necessary to assess Weisbaum’s claims and there was no cooperation from Weisbaum’s side.   The Court also was not aware of any precedent to give credence to Weisbaum’s argument that tolling the Statute of Limitations occurred because of an implied contract to arbitrate.   Hence…the four-year Statute of Limitations implies that there must be an Arbitration set and held within that time frame in order to prevent any argument by an insurer that the applicable Statute of Limitations is expired hence barring such claims.     

Jeff Krawitz is a Shareholder in Stark & Stark’s Yardley, PA office, specializing in Accident & Personal Injury Law. For more information, please contact Mr. Krawitz.