Pennsylvania Court Rules on Underinsured Motorist Coverage Case

Pennsylvania, USA — Erie Insurance Exchange has secured a significant legal victory concerning underinsured motorist (UIM) benefits. On July 22, 2025, the Superior Court of Pennsylvania upheld an earlier ruling that the company is not required to pay additional UIM benefits to Richard Russo, an employee involved in a workplace accident.

This case stems from an incident on November 19, 2018, when Russo was driving a company vehicle for Lancaster Plumbing, Heating, Cooling and Electrical and was involved in a collision. The Donegal Insurance Group, under Russo’s employer’s policy, provided the maximum UIM benefit of $35,000 for his injuries.

Russo later sought extra compensation through his personal auto policy with Erie, which included stacked UIM coverage for four vehicles. However, Erie opposed this, filing for a declaratory judgment on August 3, 2022. The insurer argued that the policy’s regular use exclusion prevented Russo from combining coverage from his personal policy with his employer’s policy due to his consistent use of the company vehicle.

The policy language states that coverage does not apply to bodily injuries involving non-owned vehicles regularly used by the insured unless those vehicles are specifically listed for UIM coverage within the policy. Erie maintained that Russo’s daily operation of company vehicles invoked this exclusion.

A trial court ruled in favor of Erie in July 2024, leading Russo to appeal. He cited prior rulings, such as Gallagher v. Geico Indemnity Co. and Rush v. Erie Insurance Exchange, in support of his case. However, the Superior Court referenced the Pennsylvania Supreme Court‘s recent decision in Rush, reaffirming the regular use exclusion’s legality.

A critical argument in Russo’s appeal involved whether he was considered an “insured” under the Donegal policy. The court concluded that he did not meet the necessary criteria to qualify as an insured, which would have permitted benefits stacking under Pennsylvania law.

This ruling ends Russo’s pursuit of additional UIM coverage and clarifies insurers’ obligations regarding employees who drive company vehicles regularly.