Panea v. Isdaner

DEL SOLE, J.,

concurring.

¶ 1 I join the Majority opinion of Judge Orie Melvin but write separately to address the concerns raised by my colleague Judge Todd in her dissent.

¶ 2 Because in my view the Pennsylvania Property and Casualty Insurance Guaran*797ty Act was designed to balance the equities between an injured claimant and an insured whose carrier becomes insolvent, I agree with the Majority’s holding that the remedy for a claimant faced with a reduction in payment following settlement is to rescind the settlement once PPCIGA seeks a setoff. Majority Opinion at 789, fn. 3.

¶3 The dissent correctly suggests that where a claimant has negotiated a compromise or waiver of subrogated interests, the claimant’s anticipated economic benefit from the original settlement would be reduced if PPCIGA were permitted to offset the sum of the subrogated interests from the settlement amount. However, providing a claimant with the ability to rescind the settlement in these circumstances alleviates this concern.

¶ 4 Also, when an insurer offers to settle within its policy limits on behalf of its insured, I cannot conclude that the insured would, or should, insist on language in the agreement which restricts the source of the payment to the insurer’s funds. Even in certain professional liability policies where an insured must approve settlement terms, the reality is that settlements within policy limits are assumed to be the responsibility of the insurer. To suggest an insured must insist on language limiting the source of payment to the insurer’s funds would, I believe, place an unnecessary burden on the insured. Further, to permit recovery of a settlement sum from an insured where the insurer becomes insolvent following settlement, but before payment, frustrates one of the purposes of the Act.