New York Insurance Coverage Law Update

Alleged Injury As Woman Exited Bus Did Not Arise Out Of Its “Use Or Operation,” NY Court Of Appeals Rules

The Court of Appeals has held that a woman who allegedly injured her ankle as she exited a New York City bus and stepped into a hole could not recover no-fault benefits because her alleged injury did not arise out of the “use or operation” of the bus.  [Cividanes v. City of New York, 2012 N.Y. Slip Op. 08174 (Ct. App. Nov. 29, 2012).]

Healthcare Provider’s Assertion That EUO Requests Were Unreasonable Was Untimely

An insurer sued by a healthcare provider asserted that the provider’s assignor had failed to appear for two scheduled examinations under oath (“EUOs”). The court granted summary judgment to the insurer, finding that the provider’s argument that there was no reasonable basis for the EUO requests was barred because the provider had not timely objected to their reasonableness. [Five Boro Psychological & Licensed Master Social Work Servs., PLLC v. GEICO Gen. Ins. Co., 2012 N.Y. Slip Op. 22333 (N.Y. Civ. Ct. Kings Co. Nov. 19, 2012).]

New York’s Minimum Limits Applied Where Insurer Failed To Show It Was Not An Authorized New York Insurer

A trial court granted judgment to a healthcare provider in its action against an insurer to recover benefits under an automobile insurance policy that was issued in Pennsylvania and had a $5,000 limit. The insurer appealed, arguing that the plaintiff’s assignor had exhausted the benefits available under the policy. The appellate court explained that an insurance company authorized to transact business in New York had to meet the state’s financial security requirements, including minimum coverage limits of $25,000/$50,000. Because the insurer had provided no information as to whether it was an authorized or unauthorized insurer in New York, the appellate court affirmed. [Flushing Traditional Acupuncture, P.C. v. Infinity Group, 2012 N.Y. Slip Op. 22345 (App. Term, 2d Dep’t Nov. 26, 2012).]

Plaintiffs Only Entitled to $25,000 Limits For Unsatisfied Judgment

The plaintiffs sued an insurer to recover a $175,000 judgment obtained against its insured.  In support of their motion for summary judgment, plaintiffs submitted a claim representative’s letter that indicated that the policy had “limits [of] 25,000/50,000.” The court ruled that this failed to demonstrate that they were entitled to the full amount of the unsatisfied judgment. [Friedman v. Progressive Direct Ins. Co., 2012 N.Y. Slip Op. 07269 (App. Div. 2d Dep’t Nov. 7, 2012).]

No Coverage Where Application Described Building As A Two-Family Dwelling – But It Had Three Apartments 

Insureds who described their property as a two-family dwelling in their application for liability insurance, even though it contained three apartments, were not entitled to coverage in a personal injury action against them because of the misrepresentation.  The court rejected the insureds’ argument that there was no misrepresentation because the property was a legal two-family dwelling.  [Hermitage Ins. Co. v. LaFleur, 2012 N.Y. Slip Op. 07407 (App. Div. 1st Dep’t Nov. 8, 2012).]

Insurer Not Required To Timely Disclaim Where Plaintiff Alleged Injuries From Intentional Acts

Where a plaintiff in a personal injury action alleged injuries from intentional acts, there was no coverage under the policy, and the insurer was not required to issue a timely written disclaimer with respect to the personal injury action under New York Insurance Law §3420(d). [State Farm Fire & Cas. Co. v. Raabe, 2012 N.Y. Slip Op. 07656 (App. Div. 2d Dep’t Nov. 14, 2012).]

Second Circuit Finds No Coverage Where Insured Took More Than A Year To Notify His Insurer Of Damage To His Property

A property owner who delayed notifying his insurer for over a year after discovering damage to his property failed to comply with the policy’s notice requirement. The court further held that the insured’s belief that a neighbor was responsible for the damage and uncertainty about whether the damage was covered did not excuse the insured’s delay.  The insurer, therefore, was entitled to deny coverage for the damage. [Pfeffer v. Harleysville Group, Inc., 2012 U.S. App. Lexis 22749 (2d Cir. Nov. 6, 2012).]