Changes to New York State Insurance Law Affect Auto Policies, Neonatal Intensive Care Coverage, and Exposures for Mortgage Guaranty Insurers

Frederick J. Pomerantz, a partner in Goldberg Segalla’s Global Insurance Services and Insurance Regulatory Practice Groups, has authored three alerts on changes to New York State insurance regulations in the November 2017 edition of the Federation of Regulatory Counsel (FORC) Alerts. In the alerts, Fred details notable recent changes pertaining to private passenger auto policies, neonatal intensive care services, and exposures for mortgage guaranty insurers. Analysis of Non-Renewals of Private Passenger Auto Policies Effective October 23, 2017, Section 1, Paragraph
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No Sympathy: Injured Claimant Without Auto Insurance Due to Fraud Barred From Bringing Personal Injury Claim

In Bencosme v. Kannankara, no. A-1672-14T3 (App. Div. Mar. 22, 2016), the New Jersey Appellate Division concluded that the apparent harshness of the decision was not a sufficient basis for it to refuse to affirm a trial court’s ruling that dismissed a personal injury lawsuit against a claimant who failed to carry statutorily required auto insurance, even though the claimant was uninsured as a result of fraud. Federico Bencosme was involved in an auto accident with Joseph Kannankara in which
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Location, Location, Location: Michigan PIP Benefits Awarded to Illinios Claimant Where Location of Accident is Only Connection to Michigan

Michigan’s no-fault insurance benefits, especially Personal Injury Protection (PIP) benefits, are among the most favorable to claimants. Michigan law requires no-fault insurance for every vehicle owner. This insurance pays for medical expenses, wage loss benefits, replacement services, and damages to other people’s property, no matter who caused the accident. These provisions make Michigan’s no-fault coverage attractive to injured claimants when insurance coverage may not otherwise be available or fault may be difficult to establish, as shown by a recent case
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Supreme Court of Illinois Limits Liability of Self-Insured Car Rental Company

On October 8, 2015, in DeShaw Nelson v. Donald Artley, the Illinois Supreme Court overturned a ruling by the First District Appellate Court  that ordered a car rental company to pay an accident victim $600,000 as a result of damages allegedly sustained in an automobile accident involving a car owned by the rental company and driven by an operator without his own insurance. At issue in DeShawn was the extent of financial liability that a self-insuring rental car company faces
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Attorney-Negotiated Medical Discounts Reduce Tort Victim’s Recovery

The Louisiana Supreme Court has issued the first ruling from a state’s highest court on the issue of whether a tort victim’s potential recovery in a lawsuit is diminished when her attorney negotiates medical discounts on her behalf. The court ruled that tort victims can only recover the lower rate for medical services they actually pay. The case, Hoffman v. 21st Century N Am. Ins. Co., No. 14-2279, 2015 La. LEXIS 1962 (La. Oct. 2, 2015), dealt with the collateral
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A Different Track: Mississippi Supreme Court Affirms Voiding of Auto Policy for Failure to Disclose 16-Year Old Son

Contrary to many states, which are reluctant to void automobile policies, the Mississippi Supreme Court in Jones v. Safeway Insurance Company, Case No. 2014-CA-00180-SCT, 2015 Miss. ELXIS 456 (Sept. 3, 2015), upheld the voiding of an automobile liability policy because the named insured failed to disclose her 16-year old son. In a win for insurers, it held that auto policies should be treated as any other insurance contract. The relevant facts are as follows: Michelle Busby applied for and obtained
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Not So Fast: Despite Policy Rescission, New Jersey Supreme Court Holds Auto Insurer Liable to Injured Third-Party

The New Jersey Supreme Court considered whether the issuer of a basic automobile insurance policy, voided due to a fraudulent application, is still on the hook for liability claims of innocent third parties in Citizens United Reciprocal Exchange v. Sabrina Perez, et al. (A-67 September Term 2013)(073384) 2015 N.J. LEXIS 871 (N.J. Aug. 13, 2015). Sabrina Perez applied for an automobile insurance policy with Citizens United Reciprocal Exchange (CURE), choosing a “basic” coverage policy with an optional $10,000 coverage limit
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Request Denied: Constitutionality Challenge of the No-Fault Automobile Insurance Act (NFAIA) Overruled in Minnesota

The No-Fault Automobile Insurance Act’s mandatory arbitration requirement of claims for $10,000 or less is now confirmed to be constitutional, according to the judgment delivered recently by the Court of Appeals of Minnesota in Unger v. AAA Ins. Co., No. A14-1885 (Minn. Ct. App. Aug. 10, 2015). Ruth and Amanda Unger were injured in a car accident after which they received chiropractic care and physical therapy. A few months later, however, AAA Insurance Company seized payment of on-going benefits and
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Minnesota Court Finds Specific Provisions In Policy Exclusion Govern Over More General Follow Form Provisions

This insurance coverage action stemmed from an underlying motor vehicle accident where Arnold Paster’s vehicle (driven by Paster and owned by Paster Enterprises) collided with Jerome G. Wind’s motorcycle. Wind sought coverage for his injuries from Paster Enterprises’  commercial automobile carrier, Phoenix Insurance Co.’s  (Phoenix) its umbrella carrier Great American Insurance Co. (Great American), and Paster’s personal automobile carrier Commerce & Industry Insurance Co.  (Commerce) and his personal excess liability carrier, Chartis  Property Casualty Co. (Chartis). In analyzing cross-motions for
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