Earlier this month, a state appellate court issued a written opinion in a car accident case, holding that a plaintiff’s failure to file her claim within the three-year period outlined in the policy contract was excusable because the insurance contract was internally contradictory. In the case, State Farm Mutual Auto Insurance v. Jakubwicz, the court held that any inconsistency in an insurance contract should be construed in favor of the insured, and State Farm should have allowed the plaintiff’s claim.
Jakubwicz and her two sons were in an accident involving another motorist. Jakubwicz filed a timely lawsuit against the other motorist, who was responsible for the accident. A little over three years after the accident, Jakubwicz realized that the other party’s insurance coverage was insufficient to cover the cost of her family’s damages, so she filed a claim under the underinsured motorist provision of her own policy with State Farm.
State Farm denied the claim, pointing to language in the insurance contract that requires all claims to be filed within three years of an accident. However, in response, Jakubwicz pointed to another clause in the policy indicating that State Farm will only pay out on an underinsured motorist claim when the underinsured motorist’s own insurance is exhausted.