New York Insurance Coverage Law Update

Fourth Department Rules Insurer Must Disclose Certain Pre-Litigation Claim File Documents Prepared By Counsel

After the plaintiff sued an insurer for supplementary underinsured motorist coverage benefits, she sought the insurer’s entire claim file.  The Appellate Division, Fourth Department, ruled that the plaintiff was not entitled to disclosure of documents created after she filed her lawsuit.  The court, however, decided that the plaintiff was entitled to see certain claim documents that had been created before the lawsuit had been filed, including certain documents prepared by counsel that were “a part of the regular business of an insurance company” even if “motivated in part by the potential for litigation.” [Lalka v. Aca Ins. Co., 2015 N.Y Slip Op. 03995 (App. Div. 4th Dep’t May 8, 2015).]

Plaintiff “Occupying” Motorcycle When She Was Injured Not Entitled To No-Fault Benefits, Court Rules

The plaintiff was riding as a passenger on a motorcycle when it was involved in an accident with a pickup truck.  The plaintiff sought first-party benefits under no-fault policies issued by two insurance companies that excluded no-fault benefits for anyone “occupying a motorcycle.”  The plaintiff argued that she had not been “occupying” the motorcycle when she was injured because she had been thrown from it and was on the ground when she was hit by the motorcycle itself.  The court rejected her argument, finding that the plaintiff’s “separation from the motorcycle” did not transform her status from an occupant of the motorcycle to a pedestrian during the “brief interval between striking the ground and being struck by the motorcycle.”  Accordingly, the court decided that the plaintiff was not entitled to first-party no-fault insurance benefits under the policies. [Boyson v. Kwasowsky, 2015 N.Y. Slip Op. 03964 (App. Div. 4th Dep’t May 8, 2015).]

No Coverage For Claim That Woman Was Negligently Injured By Bouncer

The claimant was allegedly injured when a bouncer for Beer-Bros tackled someone else into claimant. Claimant then sued Beer-Bros for negligence. Beer-Bros’ insurer sought a declaration that it had no duty to defend or to indemnify Beer-Bros, relying upon the policy’s assault and battery exclusion. The court agreed with the insurer, finding that even though the woman pleaded a negligence claim against Beer-Bros, “her injuries grew out of a battery.” The court concluded that, regard-less of the theory of liability pled, if there would be no cause of action “but-for” an assault or battery, the exclusion applied.  [Hermitage Ins. Co. v. Beer-Bros, Inc. of NYC, 2015 N.Y. Slip Op. 25155 (Sup. Ct. N.Y. May 12, 2015).]

One Time Commercial Use Of Insured Vehicle Did Not Permit Insurer To Disclaim Coverage, Second Department Rules

After a mini-van was involved in an accident, the mini-van’s insurer disclaimed liability coverage, asserting that the mini-van had been transporting a passenger “for hire” at the time of the accident. A trial court concluded that the insurer had not validly disclaimed and it appealed. The appellate court affirmed, finding that the insured’s commercial use of his mini-van constituted a “single isolated use” that was “not tantamount to its employment as a public or livery conveyance” and, therefore, did not justify GEICO’s disclaimer. [Matter of New York Cent. Mut. Fire Ins. Co. v. Byfield, 2015 N.Y. Slip Op. 01805 (App. Div. 2d Dep’t March 4, 2015).]

Court Dismisses Various Extra-Contractual Claims Brought By Insured Against Homeowner Insurer

The plaintiff sued her homeowner insurer for breach of the policy. She asserted a variety of claims that the insurer moved to dismiss in an effort to limit the dispute to a breach of contract action. The court granted the insurer’s motion.  First, it found that the plaintiff’s claims under 11 N.Y.C.R.R. § 216 (relating to unfair claims settlement practices) had to be dismissed because there is no private cause of action under the regulation. The court then dismissed the plaintiff’s New York General Business Law Section 349 claim, finding that her dispute with her insurer did not affect the public at large, as required for such a claim. Next, the court dismissed the plaintiff’s claims for consequential damages, observing that she had not pleaded any facts demonstrating that she might be entitled to anything other than contract damages under the policy.  Finally, the court dismissed the punitive damages claim, concluding that the plaintiff had not alleged any actions by the insurer that were “so morally reprehensible” as to imply “criminal indifference.” [Ripka v. Safeco Ins., 2015 U.S. Dist. Lexis 67595 (N.D.N.Y. May 26, 2015).]