Townsend v. State Farm Mutual Automobile Insurance Co.

HODGES, Chief Justice.

This case raises one issue: Does an insurer’s duty to act in good faith and deal fairly with its insureds extend to a class 2 insured passenger covered by a named insured’s uninsured motorist policy? The question is answered in the affirmative.

Toby Townsend was a covered passenger in a car owned by Abner Penn and driven by his son Michael. Penn’s car was struck by a car driven by Lee. Lee had liability coverage up to $50,000, but Townsend incurred over $900,000 in damages from the collision. Townsend filed a claim with Penn’s uninsured (underinsured) motorist carrier,…