GEICO lawsuit - Federal court makes key ruling

The incident first occurred in March 2018

GEICO lawsuit - Federal court makes key ruling

Insurance News

By Lyle Adriano

The US Court of Appeals for the Eleventh Circuit has upheld a summary judgment in GEICO’s favor regarding a $1 million legal dispute over coverage for an automobile collision.

The court panel agreed last week that an offer for uninsured motorist insurance in a renewal packet meant GEICO was not obligated to offer coverage for Sheila Lapham and her husband when they were involved in a car crash.

According to the ruling, the Laphams were living in New Jersey when they first obtained a personal umbrella policy from GEICO in 2005; that policy did not include uninsured motorist coverage. It was also noted that New Jersey does not require uninsured motorist coverage. Later, the Laphams moved to Florida in August 2016, with their coverage under the policy also transferring there.

In June 2017, GEICO sent the Laphams a renewal packet that offered $1 million in excess uninsured motorist coverage under the umbrella policy. While the Laphams renewed their insurance policy, they did not complete the uninsured motorist coverage form.

In March 2018, Sheila Lapham sustained severe injuries from a car crash and sought uninsured motorist benefits under the umbrella policy, but GEICO denied the claim. The Laphams sued the insurer in Florida federal court, claiming GEICO breached its contract.

US District Judge Charlene E. Honeywell ruled in favor of GEICO, which led to the Laphams to approach the Eleventh Circuit to review the case.

Law360 reached out to both parties and their counsel for comment, but none have responded in time for publication.

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