A Southwest Pennsylvania couple whose cattle farm was partially destroyed by a natural gas explosion likely caused by corroded underground pipes are suing their insurance company in federal court, alleging it is holding out on paying them their full policy limit until it gets paid by pipeline owner and utility Spectra Energy Corp.
Randy and Wendy Gillis, whose family-owned farm has produced crops and pastured cows for nearly a century, sued State Automobile Mutual Insurance Co. of Columbus, Ohio, alleging the insurer is compounding the suffering they’ve already experienced in the aftermath of the April 29 blast.
The gas explosion destroyed buildings and equipment on the farm, including a home rented by a tenant who was severely burned in the blast. That man is still recovering from his burn injuries and the home has not been rebuilt due to the insurer’s refusal to “pay the limits of its policy for the ….residence.”
The blast and resulting fire also burned several acres of cropland.
The couple claims they continue to face financial hardship in the aftermath because of “damage to the rental property in excess of the coverage limits; property damage to the crops, fields and land; investigation costs and cost related to crop destruction, (and) lost earnings.”
State Automobile has paid the Gillises $185,700 to date, less than one-third of their policy limit. According to the Pittsburgh Tribune-Review, the couple alleges “the insurer is violating state insurance laws by seeking reimbursement of its payments from Spectra Energy Corp., the company that operates the interstate transmission pipeline, before the Gillises have been fully reimbursed for their losses.”
“It is well settled under Pennsylvania law that, regardless of the language in an insurance policy, a subrogation lien or interest cannot arise or attach until the insured has received the settlement proceeds or damage award and … has been made whole,” the complaint states.
According to the Tribune-Review, the Gillises “are seeking a judgment that State Automobile cannot receive any reimbursement until the Gillises ‘have been made whole,’ a permanent injunction barring any such reimbursement to State Automobile, and punitive damages, interest and attorneys fees.”
Source: The Pittsburgh Tribune-Review