When litigating a case, what attorney would not want to be diligent and preserve all possible defenses for their client? While this is an understandable goal, practitioners attempting to achieve such an objective through filing affirmative defenses must be cautious to not end up doing more harm than good. In this regard, there has been a trend over the last several years, especially in the federal district courts in this commonwealth, of judges sua sponte striking affirmative defenses that lack basis in law or in fact. While merely striking affirmative defenses that should not have been in the action in the first place may not be a sufficient deterrent to curb the filing of frivolous defenses, where the assertion of such baseless prophylactic defenses occurs in first party insurance litigation, such as uninsured (UM) or underinsured (UIM) motorist claims, it may result in much harsher repercussions. In fact, such conduct may expose the insurer to a claim for insurance bad faith.

Pennsylvania courts have long recognized that “the utmost fair dealing should characterize the transactions between an insurance company and the insured … Moreover, the insurance company has a duty to deal with its insured on a fair and frank basis, and at all times, to act in good faith.” See Berg v. Nationwide Mutual Insurance., 44 A.3d 1164, 1170 (Pa. Super. 2012) (quoting Dercoli v. Pennsylvania National Mutual Insurance, 520 Pa. 471, 554 A.2d 906, 909 (Pa. 1989)). “The duty of good faith originates from the insurer’s status as a fiduciary for its insured under the insurance contract, which gives the insurer the right, inter alia, to handle and process claims.” Such duty owed to an insured does not change depending on whether the claim is in the context of a UM/UIM claim or that of a third party claim. On the contrary:

Pennsylvania law holds insurers to a duty of good faith and fair dealing toward their insureds without distinguishing between first party and third party settings. … While the legal relationship of the parties may change in the context of a U-claim, i.e., become adversarial, the insurer’s duty does not change.