Statutory Text
§ 1787. Self-insurance.
(a) General rule.--Self-insurance is effected by filing with the Department of Transportation, in satisfactory form, evidence that reliable financial arrangements, deposits, resources or commitments exist such as will satisfy the department that the self-insurer will:
(1) Provide the benefits required by section 1711 (relating to required benefits), subject to the provisions of Subchapter B (relating to motor vehicle liability insurance first party benefits), except the additional benefits and limits provided in sections 1712 (relating to availability of benefits) and 1715 (relating to availability of adequate limits).
(2) Make payments sufficient to satisfy judgments as required by section 1774 (relating to payments sufficient to satisfy judgments).
(3) Provide uninsured motorist coverage up to the limits set forth in section 1774.
(b) Stacking limits prohibited.--Any recovery of uninsured motorist benefits under this section only shall not be increased by stacking the limits provided in section 1774, in consideration of the ownership or operation of multiple vehicles or otherwise.
(c) Assigned Risk and Assigned Claims Plans.--Self-insurers shall not be required to accept assigned risks pursuant to Subchapter D (relating to Assigned Risk Plan) or contribute to the Assigned Claims Plan pursuant to Subchapter E (relating to Assigned Claims Plan).
(d) Catastrophic Loss Trust Fund.--(Repealed).
(e) Promulgation of regulations, etc.--The Department of Transportation may, jointly with the Insurance Department, promulgate rules, regulations, guidelines, procedures or standards for reviewing and establishing the financial eligibility of self-insurers.
Key terms:
Self-insurance:
A system in which a party, in this case a motor vehicle owner, bears the complete financial risk and obligation for potential losses rather than transferring such risk to an insurance provider.
Stacking:
It refers to an automobile insurance provision allowing a policyholder to combine coverage limits from multiple vehicles or multiple policies. However, this section prohibits any stacking of uninsured motorist benefits.
Assigned Risk and Assigned Claims Plans:
These are arrangements where insurers accept high-risk drivers and claims from individuals who have been denied coverage by insurers in the standard market.
Catastrophic Loss Trust Fund:
A fund established to cover losses from catastrophic events. However, this has been repealed under this statute.
Importance for Pennsylvanian drivers:
Understanding the self-insurance clause is significant for drivers in Pennsylvania considering self-insurance as it defines their responsibilities and obligations in clear terms. It's critical to understand that they will need to bear full financial liability for potential losses, meet potential lawsuit judgments and extend adequate uninsured motorist coverage.
Importance for Pennsylvania attorneys:
Section 1787 of the Pennsylvania Motor Vehicle Financial Responsibility Law (MVFRL) outlines the rules and requirements for self-insurance for motor vehicle owners. It stipulates that self-insurer should prove financial viability by submitting verifiable documents to the Department of Transportation in order to provide mandated benefits, satisfy potential lawsuit judgments, and offer uninsured motorist coverage.
For attorneys, getting to grasp this section of MVFRL is essential to properly guide and advise their clients about their obligations and responsibilities as self-insurers. This knowledge would also ensure they're versed with the complexities of cases involving self-insured motor vehicle owners and the precise means to navigate them.
Advanced analysis:
The language in this section makes it clear that Pennsylvania puts the onus of demonstrating financial viability squarely on the self-insurer. The phrase "satisfy the department that the self-insurer will" preceding the enumerated obligations signifies the heavy burden assumed by self-insured drivers.
The prohibition on "stacking" makes it clear that, unlike traditional insurance, self-insured drivers cannot boost their recovery by owning or operating multiple vehicles. The elimination of "Catastrophic Loss Trust Fund" responsibilities implies the need for self-insurers to provide guarantee of their ability to cover massive loss-triggering events. The state empowers the Department of Transportation to promulgate rules and regulations, which indicates that standards for self-insurers are not static, but are subject to changes based on prevailing circumstances.
In conclusion, this section is fundamental for Pennsylvanian drivers considering self-insurance as well as attorneys who may represent them. It underscores the substantial responsibility and financial commitment undertaken by self-insurers, while also clarifying obligations pertaining to providing mandated benefits, satisfying potential lawsuit judgments, and offering uninsured motorist coverage.
