Keystone Aerial Surveys, Inc. v. Pennsylvania Property & Casualty Insurance Guaranty Ass'n

Justice CASTILLE,

dissenting.

I disagree with the Majority’s conclusion that each of the five surviving members of decedent Thomas Campbell’s immediate family is a separate claimant for purposes of determining the obligation and exposure of the Pennsylvania Property and Casualty Insurance Guaranty Association (“PPCIGA” or “Association”), so long as their derivative claims may fairly be said to arise out of and fall within the scope of coverage provided by the defunct insurer, American Eagle Insurance Company. Therefore, I respectfully dissent.

The PPCIGA Act provides that the Association is obligated to pay covered claims arising out of the insolvency of insurers authorized to write property and casualty insurance policies in Pennsylvania, subject to certain limitations. 40 P.S. § 991.1803. The pertinent limitation in this appeal provides that the Association’s obligation is met when it pays “an amount not exceeding three hundred thousand ($300,000) dollars per claimant” for all claims other than those involving unearned premiums. Id. The question germane to this appeal is whether the General Assembly intended that when family survivors litigate a wrongful death action deriving from the death of an insured single decedent, the number of statutory claimants and the amount of the Association’s exposure should increase according to the number of survivors; or, did the Assembly intend that the single decedent through whom the survivors litigate determines the number of claimants?

The Majority agrees with the Superior Court that the appropriate definition of “claimant” should depend upon the language of the underlying insurance policy with the insolvent insurer and, therefore, the Association’s exposure may vary. I cannot accept the Majority’s approach, since it permits the *160language of the underlying insurance policy to displace the governing statute thereby effectively eliminating the statutory “cap” on recovery.

Preliminarily, I note that both the Superior Court and the Common Pleas Court assumed that Texas law allows multiple claimants in wrongful death actions. See Super. Ct. slip op. at 3 n. 3 and 19 n. 13; trial court slip op. at 3. That is not how I read the admittedly scant authorities provided this Court on that question. Section 71.004 of the Texas wrongful death statute, Tex. Civ. Prac. & Rem.Code § 71.004, lists the beneficiaries of a wrongful death action and who may file that action under the statute:

(a) An action to recover damages as provided by this sub-chapter is for the exclusive benefit of the surviving spouse, children, and parents of the deceased.
(b) The surviving spouse, children, and parents of the deceased may bring the action or one or more of those individuals may bring the action for the benefit of all.
(c) If none of the individuals entitled to bring an action have begun the action within three calendar months after the death of the injured individual, his executor or administrator shall bring and prosecute the action unless requested not to by all those individuals.

Id. (emphasis supplied). Thus, although the statute recognizes multiple potential beneficiaries, it speaks of a single wrongful death action. Moreover, Section 71.003 of the Code limits when such an action may be filed: “This subchapter applies only if the individual injured would have been entitled to bring an action for the injury if he had lived.” Tex. Civ. Prac. & Rem.Code § 71.003. The Texas Court of Appeals has recognized that the statutory language demonstrates the derivative nature of a wrongful death claim: “the Wrongful Death Statute and Survival Statute expressly state that any action brought under either are derivative of the decedent’s rights.” Zacharie v. U.S. Natural Resources, Inc., 94 S.W.3d 748, 757-58 (Tex.Ct.App.2002). Accordingly, while the Camp-bells are all potential beneficiaries under the Texas wrongful death statute, their “claim” (here brought by one for the *161benefit of all) is a single claim derivative of the decedent’s claim. Thus, Texas law, no less than Pennsylvania law, apparently recognizes that a single decedent cannot be the source of multiple, derívate wrongful death “claims.” 1

The very nature of insurance policies also commands a finding of a single claimant here. Insurance policies of all types, be they automobile, commercial or general liability policies, designate limits of exposure. These limits on liability are typically stated in terms of the limit per claimant and per occurrence. For example, an automobile insurance policy may limit liability to $15,000 per individual claimant and $30,000 per occurrence. If the insured on that automobile policy is involved in an accident where a third party is fatally injured, the third party’s estate would recover the $15,000 policy limit per individual, regardless of the number of dependents/heirs/beneficiaries the third party decedent left. The fortuity that the decedent left four heirs would not increase the insurer’s exposure fourfold to $60,000. The exposure, in every case, would properly be the policy limit of $15,000 because the true claimant against the policy is the decedent, not the arbitrary and unpredictable number of heirs or survivors who try to squeeze into his single pair of shoes. The survivors’ right of recovery is capped by their decedent’s right; and the insurer’s limit of exposure is commensurately ascertainable and assured.2

*162Insurance policies containing policy limits typically function in the same manner. The policy limit sets the absolute limit of liability; the unpredictable number of dependents, heirs or beneficiaries a deceased claimant leaves behind does not arbitrarily multiply the exposure. Insurance policies are deliberately structured with foreseeable limits in order to provide insurers with a basis upon which to calculate their risk, ie., the amount they will need to pay covered claims. To inject an unknowable and, indeed, exponential variable such as the number of beneficiaries or dependents of an injured person would skew actuarial computations and potentially leave insurers with insufficient funds -with which to pay claims, resulting in the prospect of insurer insolvency.3

The Association acts like an emergency limited insurer and in fact steps into the shoes of an insolvent insurer, subject to the statutory provisions limiting the Association’s obligations and financial exposure. Those provisions set a cap on the amount recoverable per claimant, a cap that is tantamount to an insurer’s limit of liability. Here, the now-insolvent insurer, American Eagle, insured Keystone Aerial Surveys under a policy covering accidental harm to aircraft and passengers. Thomas Campbell was tragically killed when an airplane owned by Keystone crashed with him aboard. But, that single decedent, and not his surviving wife or their four children, was a passenger in the doomed aircraft. Had the decedent survived with injury he would have had a single claim against the insurer; the circumstance of his demise, while tragic, does not change the nature of that unitary claim. Rather, common sense and standard insurance practices should dictate that he is the true claimant for purposes of the Act and that the *163claims of his family survivors are merely derivative of the single insured claim arising out of the plane crash.4

In the same way that policy limits provide insurers with some measure of control over the amount paid for claims and, therefore, an ability to tailor appropriate premiums commensurate with the risk involved, the statutory cap on the Association’s obligations is essential. The cap helps ensure that the amount the Association will pay out in a given year will not exceed the tightly-controlled amounts paid into it by insurers writing policies in Pennsylvania. The Association is funded by assessments against solvent insurers. The Association calculates the total amount needed to meet its obligations and then assesses each solvent insurer its share of that total “in the proportion that the net direct written premiums of the member insurer for the preceding calendar year ... bears to the aggregate net direct written premiums of all member insurers for the preceding calendar year.” 40 P.S. § 991.1808(b). The maximum assessment against any solvent insurer, however, is limited: no insurer can be assessed “an amount greater than two per centum (2%) of that member insurer’s net direct written premiums for the preceding calendar year.” Id. § 991.1808(d). Due to the statutorily limited resources available to the Association, the statutory cap is absolutely essential to maintaining the integrity of the Association and its ability to pay claimants at least some recovery on covered claims from insolvent insurers.

Unlike the Majority, I would not leave the question of the meaning of the statutory term claimant to the vagaries of various states’ intestacy laws lest the Association itself become insolvent. Indeed, given the function of the Association, and its financial structure, I believe a reading of the statute that would define the word claimant to permit multiple survivors of *164a single tort victim separate recoveries against the Association is both unreasonable and antithetical to the purpose of the Association. Pennsylvania law pertaining to wrongful death actions permits only the personal representative of a decedent to file a wrongful death action on behalf of the decedent’s beneficiaries. See Pa.R.C.P. 2201(a); Tulewicz v. Southeastern Pennsylvania Transp. Auth., 529 Pa. 588, 606 A.2d 427, 431 n. 9 (Pa.1992) (separate damage caps do not apply to each beneficiary because Rule 2201 “clearly provides that it is only the personal representative of the decedent who may maintain an action for wrongful death for the benefit of those persons entitled by law to recover damages for such -wrongful death.”). This principle, while not directly applicable here, provides support for the conclusion that the term “claimant” as used in the Act means the individual actually injured in the course of the covered event, and not that individual’s survivors, who step into his single pair of shoes.

Here, the surviving members of the Campbell family have no claims for injury to themselves against the insolvent insurer. Rather, their claims devolve from the single decedent’s claim for injury, which became his estate’s claim upon his death. Thus, I would hold that the enumerated members of the Campbell family, through their decedent’s estate, comprise a single claimant for purposes of the Act. Accordingly, I would reverse the Superior Court and affirm the trial court’s grant of summary judgment in favor of the Association. Because the Majority does otherwise, I respectfully dissent.

. The Majority misapprehends the purpose of my "preliminary” discussion of Texas law, which was occasioned only because I believe that the parties misunderstood it. I do not suggest that Texas law controls the number of PPCIGA claimants in this case or that Texas law defines PPCIGA exposure. I simply note the tangential point that, in fact, my understanding of the PPCIGA Act does not create a conflict with Texas law.

. The Majority also misconstrues the purpose of my discussion of these general insurance principles. I agree with the Majority that the question in the case sub judice is one of statutory interpretation of the PPCIGA Act regarding what is a claim or claimant. Unlike the Majority, I conclude that the statute intends to limit PPCIGA’s exposure to one claim where would-be multiple claimants seek relief as survivors of a single, actual injured or deceased individual. Thus, my discussion of general insurance principles is not meant as a guidepost to explicating the American Eagle policy, but rather is offered to further explain what *162I believe the General Assembly intended when it defined the exposure of PPCIGA.

. I agree with the Majority that this case involves third party claimants. The derivative, survivor claim here is, by definition, a third party claim. I simply disagree with the Majority's conclusion that that third party claim multiplies exponentially merely because, by happenstance, there are multiple survivors to step into the single pair of shoes left by the true third party claimant, here the deceased.

. In all likelihood, due to the nature of liability insurance policies and limits on liability contained therein, the remand ordered by the Superi- or Court and affirmed by a majority of this Court will result in a finding that the decedent was, indeed, the sole claimant under the language of the American Eagle policy. But, that does not alter the impracticality of the analytical paradigm approved by the Majority.