Nationwide sues customers over policy limits

MARTINSBURG – Nationwide Mutual Insurance Company is suing two individuals who have been attempting to get the insurance company to pay more than its policy limits.

Mark O. Harris, individually and as personal representative of the Estate of Patricia A. Harris, deceased, and Laura M. Ferguson, individually and as parent and next friend of B.M.H. and T.M.F., minors, were named as defendants in the suit.

On Aug. 16, 2011, a vehicle owned by Maribel Villegas and being operated by her husband, Ruben Gutierrez-Villegas, collided with a vehicle owned and occupied by Patricia Harris, operated by Ferguson and further occupied by Ferguson’s two children, B.M.H. and T.M.F., according to a complaint filed Feb. 12 in the U.S. District Court for the Northern District of West Virginia at Martinsburg.

Nationwide claims Gutierrez-Villegas negligently operated the vehicle and by his negligence, caused the death of Harris and personal injures to Ferguson and her children.

The Villegas' vehicle was insured by Progressive Classic Insurance Company and Progressive has offered the bodily injury and liability and property damage liability coverage limits applicable under its insurance policy on the Villegas' vehicle to the defendants and other parties injured in the accident, according to the suit.

Nationwide claims Progressive has already paid Nationwide $1,422 in full settlement of all property damage liability incurred by Villegas and Gutierrez-Villegas as a result of the accident, and Progressive’s payment to Nationwide was made as a pro rata reimbursement for a $2,177.10 payment made by Nationwide to Mark Harris on Oct. 19, 2011, through the underinsured motorist property damage coverage available under the Harris policy.

The defendants have sustained combined damages as a result of Gutierrez-Villegas and/or Villegas that exceed the $20,000/$40,000 limits of the bodily injury liability insurance coverage available through Progressive for the Villegas vehicle, according to the suit.

Nationwide claims it offered Mark Harris and Patricia Harris the opportunity to purchase underinsured motorist insurance coverage with bodily injury limits as high as $100,000 per person and $300,000 per occurrence at an additional premium of $184.70 per six months on Nov. 25, 2009.

Despite Nationwide’s offer, Mark Harris and Patricia Harris did not accept the offer, according to the suit. However, on Jan. 4, the defendants’ counsel wrote a letter to Nationwide confirming that Progressive had “offered the minimal policy limits available under its insured’s liability policy, but, nevertheless, demanding that Nationwide pay the full $300,000 in uninsured motorist coverage…”

Nationwide claims on Jan. 17,  the defendants’ counsel wrote a second letter to Nationwide stating that the defendants “will refuse to accept liability coverage from Progressive” and again demanded that Nationwide pay the $300,000 uninsured policy limits.

On Jan. 28, the defendants’ counsel wrote a letter to Progressive confirming that the defendants were not demanding that Progressive tender liability coverage for the claims, according to the suit.

Nationwide claims on Feb. 8, it responded to the defendants’ counsel by confirming that Progressive had provided bodily injury and property damage liability coverage for the Villegas vehicle and the vehicle did not meet the policy definition of an uninsured motor vehicle.

On Feb. 11, Nationwide offered the defendants the $25,000/$50,000 underinsured motorist bodily injury policy limits of their policy “in full settlement of its obligations to its insureds under said policy and requested the defendants’ allocation of these insurance proceeds” among Patricia Harris’ estate, Ferguson and her children, according to the suit.

Nationwide is seeking for the court to enter a declaratory judgment orders finding that the Villegas vehicle is not an uninsured motor vehicle; there is no uninsured motorist bodily injury or property damage coverage available through the Harris policy because Progressive already provided bodily injury and property damage liability coverage; the defendants’ policy provides underinsured, not uninsured, coverage; and that Nationwide has properly offered the $25,000/$50,000 underinsured motorist bodily injury coverage limits available through the policy and satisfied all of its obligations to its insureds.

Nationwide is also seeking for the court to enter orders granting Nationwide permission to deposit the $25,000/$50,000 underinsured motorist coverage limits available through the policy with the court for allocation among Patricia Harris’ estate, Ferguson and her children; appointing a guardian ad litem to represent the interests of Ferguson’s two minor children; approving the settlements made on behalf of B.M.H. and T.M.F. for those portions of the underinsured coverage limits; and directing Ferguson to execute a full release of all claims against Nationwide. It is being represented by Joseph L. Caltrider and Jared M. Adams of Bowles Rice, LLP.

The case has been assigned to District Judge Gina M. Groh.

U.S. District Court for the Northern District of West Virginia at Martinsburg case number: 3:13-cv-14