§ 1705. Election of tort options.
(a) Financial responsibility requirements.--
(1) Each insurer, not less than 45 days prior to the first renewal of a private passenger motor vehicle liability insurance policy on and after July 1, 1990, shall notify in writing each named insured of the availability of two alternatives of full tort insurance and limited tort insurance described in subsections (c) and (d). The notice shall be a standardized form adopted by the commissioner and shall include the following language:
NOTICE TO NAMED INSUREDS
A. "Limited Tort" Option--The laws of the Commonwealth of Pennsylvania give you the right to choose a form of insurance that limits your right and the right of members of your household to seek financial compensation for injuries caused by other drivers. Under this form of insurance, you and other household members covered under this policy may seek recovery for all medical and other out-of-pocket expenses, but not for pain and suffering or other nonmonetary damages unless the injuries suffered fall within the definition of "serious injury" as set forth in the policy or unless one of several other exceptions noted in the policy applies. The annual premium for basic coverage as required by law under this "limited tort" option is $ .
Additional coverages under this option are available at additional cost.
B. "Full Tort" Option--The laws of the Commonwealth of Pennsylvania also give you the right to choose a form of insurance under which you maintain an unrestricted right for you and the members of your household to seek financial compensation for injuries caused by other drivers. Under this form of insurance, you and other household members covered under this policy may seek recovery for all medical and other out-of-pocket expenses and may also seek financial compensation for pain and suffering and other nonmonetary damages as a result of injuries caused by other drivers. The annual premium for basic coverage as required by law under this "full tort" option is $ .
Additional coverages under this option are available at additional cost.
C. You may contact your insurance agent, broker or company to discuss the cost of other coverages.
D. If you wish to choose the "limited tort" option described in paragraph A, you must sign this notice where indicated below and return it. If you do not sign and return this notice, you will be considered to have chosen the "full tort" coverage as described in paragraph B and you will be charged the "full tort" premium.
I wish to choose the "limited tort" option described in paragraph A:
E. If you wish to choose the "full tort" option described in paragraph B, you may sign this notice where indicated below and return it. However, if you do not sign and return this notice, you will be considered to have chosen the "full tort" coverage as described in paragraph B and you will be charged the "full tort" premium.
I wish to choose the "full tort" option described in paragraph B:
(2) Insurers shall print the above notice containing both options on one sheet in prominent type and place in a prominent location. Any person signing, or otherwise bound by, a document containing such terms is bound by such election and is precluded from claiming liability of any person based upon being inadequately informed in making the election between full tort or limited tort alternatives. Where there are two or more named insureds on a policy, any named insured may make the full or limited tort election provided for in this section for all named insureds on the policy.
(3) If a named insured who receives a notice under paragraph (1) does not indicate a choice within 20 days, the insurer shall send a second notice. The second notice shall be in a form identical to the first notice, except that it shall be identified as a second and final notice. If a named insured has not responded to either notice ten days prior to the renewal date, the named insured and those he is empowered by this section to bind by his choice are conclusively presumed to have chosen the full tort alternative. All notices required by this section shall advise that if no tort election is made, the named insured and those he is empowered to bind by his choice are conclusively presumed to have chosen the full tort alternative. Any person subject to the limited tort option by virtue of this section shall be precluded from claiming liability of any person based upon being inadequately informed.
(4) Each insurer, prior to the first issuance of a private passenger motor vehicle liability insurance policy on and after July 1, 1990, shall provide each applicant with the notice required by paragraph (1). A policy may not be issued until the applicant has been provided an opportunity to elect a tort option.
(5) An owner of a currently registered private passenger motor vehicle who does not have financial responsibility shall be deemed to have chosen the limited tort alternative.
(6) Nothing in this section changes or modifies the existing requirement that owners of registered vehicles maintain bodily injury and property damage liability insurance arising out of the ownership, maintenance or use of a motor vehicle.
(b) Application of tort options.--
(1) The tort option elected by a named insured shall apply to all private passenger motor vehicle policies of the named insured issued by the same insurer and shall continue in force as to all subsequent renewal policies, replacement policies and any other private passenger motor vehicle policies under which the individual is a named insured until the insurer, or its authorized representative, receives a properly executed form electing the other tort option.
(2) The tort option elected by a named insured shall apply to all insureds under the private passenger motor vehicle policy who are not named insureds under another private passenger motor vehicle policy. In the case where more than one private passenger motor vehicle policy is applicable to an insured and the policies have conflicting tort options, the insured is bound by the tort option of the policy associated with the private passenger motor vehicle in which the insured is an occupant at the time of the accident if he is an insured on that policy and bound by the full tort option otherwise.
(3) An individual who is not an owner of a currently registered private passenger motor vehicle and who is not a named insured or insured under any private passenger motor vehicle policy shall not be precluded from maintaining an action for noneconomic loss or economic loss sustained in a motor vehicle accident as the consequence of the fault of another person pursuant to applicable tort law.
(c) Full tort alternative.--Each person who is bound by the full tort election remains eligible to seek compensation for noneconomic loss claimed and economic loss sustained in a motor vehicle accident as the consequence of the fault of another person pursuant to applicable tort law.
(d) Limited tort alternative.--Each person who elects the limited tort alternative remains eligible to seek compensation for economic loss sustained in a motor vehicle accident as the consequence of the fault of another person pursuant to applicable tort law. Unless the injury sustained is a serious injury, each person who is bound by the limited tort election shall be precluded from maintaining an action for any noneconomic loss, except that:
(1) An individual otherwise bound by the limited tort election who sustains damages in a motor vehicle accident as the consequence of the fault of another person may recover damages as if the individual damaged had elected the full tort alternative whenever the person at fault:
(i) is convicted or accepts Accelerated Rehabilitative Disposition (ARD) for driving under the influence of alcohol or a controlled substance in that accident;
(ii) is operating a motor vehicle registered in another state;
(iii) intends to injure himself or another person, provided that an individual does not intentionally injure himself or another person merely because his act or failure to act is intentional or done with his realization that it creates a grave risk of causing injury or the act or omission causing the injury is for the purpose of averting bodily harm to himself or another person; or
(iv) has not maintained financial responsibility as required by this chapter, provided that nothing in this paragraph shall affect the limitation of section 1731(d)(2) (relating to availability, scope and amount of coverage).
(2) An individual otherwise bound by the limited tort election shall retain full tort rights with respect to claims against a person in the business of designing, manufacturing, repairing, servicing or otherwise maintaining motor vehicles arising out of a defect in such motor vehicle which is caused by or not corrected by an act or omission in the course of such business, other than a defect in a motor vehicle which is operated by such business.
(3) An individual otherwise bound by the limited tort election shall retain full tort rights if injured while an occupant of a motor vehicle other than a private passenger motor vehicle.
(e) Nondiscrimination.--No insurer shall cancel, refuse to write or refuse to renew a motor vehicle insurance policy based on the tort option election of the named insured. Any violation of this subsection shall be deemed a violation of the Automobile Insurance Policy Act.
(f) Definitions.--As used in this section, the following words and phrases when used in this section shall have the meanings given to them in this subsection unless the context clearly indicates otherwise:
"Insured." Any individual residing in the household of the named insured who is:
(1) a spouse or other relative of the named insured; or
(2) a minor in the custody of either the named insured or relative of the named insured.
"Named insured." Any individual identified by name as an insured in a policy of private passenger motor vehicle insurance.
(Feb. 7, 1990, P.L.11, No.6, eff. imd.)
1990 Amendment. Act 6 added section 1705.
References in Text. The act of June 5, 1968 (P.L.140, No.78), referred to as the Automobile Insurance Policy Act, referred to in subsec. (e), was repealed by the act of June 17, 1998, P.L.464, No.68. The subject matter is now contained in Article XX of the act of May 17, 1921 (P.L.682, No.284), known as The Insurance Company Law of 1921.
Cross References. Section 1705 is referred to in sections 1731, 1791.1, 1799.7 of this title.
What is Section 1705 of Pennsylvania's Motor Vehicle Financial Responsibility Law (MVFRL)?
Section 1705 of the Pennsylvania Motor Vehicle Financial Responsibility Law outlines the types of car insurance coverage options available to drivers. It's a key part of the law that impacts how claims are handled in the event of a car accident. Understanding this section can help you make informed decisions about your insurance coverage and prepare you for any unfortunate incidents that may occur while driving.
Limited Tort vs. Full Tort Coverage Under the MVFRL
One of the most critical aspects of Section 1705 is the distinction between limited tort and full tort coverage options. This choice affects your ability to seek compensation for injuries after an accident.
Limited Tort: By choosing limited tort, you pay a lower premium but also limit your right to seek compensation for pain and suffering unless the injuries meet a "serious injury" threshold as defined by the law. This option is more budget-friendly but comes with significant restrictions on your ability to sue for non-monetary damages.
Full Tort: Opting for full tort coverage allows you to retain unrestricted rights to sue for pain and suffering after an accident, regardless of the severity of the injuries. This option typically comes with a higher premium but provides broader legal rights.
Uninsured and Underinsured Motorist Coverage Under Pennsylvania's MVFRL
Section 1705 also addresses uninsured and underinsured motorist coverage, which protects you if you're involved in an accident with a driver who either lacks insurance or doesn't have enough to cover the damages.
Uninsured Motorist (UM) Coverage: UM coverage steps in when you're hit by an uninsured driver. It can cover medical expenses, lost wages, and pain and suffering.
Underinsured Motorist (UIM) Coverage: UIM coverage is utilized when the at-fault driver's insurance is insufficient to cover your losses. It can provide additional compensation beyond what the other driver's insurance pays out.
Stacking of Coverage Under Pennsylvania's MVFRL
Another important concept in Section 1705 is the "stacking" of uninsured and underinsured motorist coverage. Stacking allows you to combine coverage limits for multiple vehicles on your policy, potentially increasing the amount of your claim. However, you must specifically choose this option, and it will increase your premium.
Economic Loss and Non-Economic Loss Under Pennsylvania's MVFRL
The law also differentiates between economic and non-economic losses:
Economic Loss: This includes quantifiable financial expenses such as medical bills, rehabilitation costs, and lost wages.
Non-Economic Loss: This refers to compensation for pain and suffering, which is more subjective and not easily quantified.
Making the Right Choice for You
When selecting your insurance coverage under Section 1705, consider your personal circumstances, financial situation, and risk tolerance. It's a balancing act between protecting your rights and managing your insurance costs.
Understanding Section 1705 of the Pennsylvania Motor Vehicle Financial Responsibility Law is essential for all Pennsylvania drivers. It empowers you to make informed decisions about your insurance coverage and ensures you're adequately protected on the road. Whether you opt for limited or full tort, or decide to stack your coverage, knowing your options under Section 1705 can give you peace of mind and financial security.
Remember, the choice you make can have significant implications if you're ever involved in an accident. If you're ever in doubt, consult with a knowledgeable Pennsylvania plaintiff's attorney who can guide you through the complexities of the MVFRL and help safeguard your rights as a driver.