No-Fault Insurance

Interplay b.w. Workers' Comp and No-Fault Insurance

A WC carrier does not have a lien on the proceeds of a recovery in an action arising out of an auto accident and may not institute an action for such a recovery as assignee.

First-Party Benefits: Deductions

A covered person can receive a maximum of only 80% of his basic economic loss attributable to lost earnings (i.e., there's a 20% loss of earnings deduction) There's a deduction for amounts recoverable on account of injuries under state/federal laws providing Social Security disability benefits or Workers Comp benefits). There is NO deduction for: -- Medicare --Medicaid -- Blue Cross-Blue Shield -- Private accident and health insurance coverage There is a family deductible of up to $200.

Requirements for a Tort Action between covered person and non-covered person

A covered person may sue a non-covered person for all damages (including basic economic loss and pain and suffering - even absent serious injury). BUT - the insurer has a lien against recovery for all first-party benefits paid/payable by it to a covered person. -- A covered person may not settle w/ a non-covered person unless (1) the covered person has written consent to do so from his insurer, (2) the settlement is approved by the court, or (3) the settlement amount exceeds $50,000. Subrogation: An insurer is subrogated to any cause of action not commenced by its insured against a non-covered person within two years, to the extent of first-party benefits paid/payable to the insured. -- An insurer who pays first-party benefits may NOT seek reimbursement by subrogation from the tortfeasor except where the statute allows (e.g., against non-covered person, for serious non-economic loss, or where a no-fault insurer seeks recovery against the tortfeasor's insurer).

Persons Covered by No-Fault Insurance

"Covered persons" include persons injured by the insured owner's vehicle, including: 1) the owner, operator or occupants of the insured's auto, 2) pedestrians hit by the insured's auto, and 3) any other persons entitled to first-party benefits. -- ALSO includes 4) persons injured by an uninsured motorist, and 5) persons injured outside of the state by an insured motor vehicle. 6) Occupants of a school bus, but only if not covered by another policy providing first party benefits 7) Pedestrians injured by a motorcycle/ATV in NY

"Serious Injury"

Serious Injury (proof of which allows a covered party to bring a tort action against another covered party, despite no-fault) includes: 1) Death 2) Dismemberment (loss of limb) 3) Serious disfigurement (scarring, etc.) 4) Fracture 5) Loss of fetus 6) Permanent loss of use of bodily organ or bodily member 7) Permanent consequential limitation of the use of a bodily organ/member

No-Fault Coverage

The Act provides: -- up to $50,000 "first-party benefits" (i.e., no-fault benefits payable to the insured) PLUS -- $25,000/$50,000/$10,000 minimum liability coverage if the insured is sued by a third party in a tort action. The Act does NOT provide coverage for property damage, but auto policies by statute must have a minimum of $10,000 liability coverage.

Benefits for Parties Injured by Uninsured/Unidentified Vehicles

The Motor Vehicle Accident Indemnification Corporation (MVAIC) provides no-fault benefits to injured parties who, through no fault of their own, were involved in an accident w/ motor vehicles that were either uninsured, stolen, unidentified (hit and run), operated w/o the owner's permission, or unregistered. An injured party may also recover no-fault benefits through MVAIC if the car in question was registered in another state or not covered by a NY liability policy.

Settlement of No-Fault Insurance Claims

- First-party benefits must be paid as the loss is incurred (periodically) -- A claim must be paid within 30 days after the claimant presents proof of the fact and amount of the loss.

Persons that MAY be excluded from No-Fault Coverage

1) Persons occupying another motor vehicle or motorcycle, 2) Any person injured: -- by his own intentional act -- while operating a motor vehicle in an intoxicated state -- while committing a felony or attempting to avoid a lawful arrest -- while operating a motor vehicle in a race or speed test -- while operating or occupying a motor vehicle known by him to be stolen -- while operating/occupying his own vehicle for which no-fault coverage is not in effect -- while a pedestrian being struck by his own vehicle for which no-fault coverage is not in effect -- while repairing, servicing, or maintaining a motor vehicle and the injury occurs on business premises

Tort suit by non-covered person against a covered or non-covered person

A non-insured motorist as a CL cause of action against a negligent party if the injuries suffered were within the statutory definition of serious injuries.

Coverage of Motorcycle/ATV Policies

All motorcycle/ATV liability policies must provide no-fault benefits to persons other than occupants of the motorcycle, another motorcycle, or any other motor vehicle for injuries arising out of the use/operation of a motorcycle in New York.

Requirements for a Tort Action between Two Covered Persons

An injured party may pursue a tort action based on ordinary negligence against another covered person ONLY if he can show EITHER (1) economic loss in excess of basic economic loss [$50,000 once adding up medical expenses, lost wages up to 3 yrs and misc. expenses of $25/day for 1 yr], OR (2) serious injury * If raised by the defendant, the P must make a preliminary showing in court that one of these conditions is satisfied. The following may be recovered in such an action: 1) Property damage claims, 2) Damages for wrongful death, 3) Any economic loss not included in basic economic loss [b.c. P will have already recovered basic economic loss amount from his own insurance company under the no-fault provisions], and 4) Non-economic loss (i.e., pain and suffering) IF there is a serious injury.

First-Party Benefits: Basic Economic Loss

Basic Economic Loss includes: (1) Medical Expenses: -- Insured party may recover ALL "necessary" medical expenses (including non-traditional treatment, such as treatment administered in accordance w/ religious beliefs). -- No time limit on recovery, as long as it can be determined within 1 yr after the accident that further expenses may be incurred. (2) Lost Earnings -- Includes salaries and wages, as well as reasonable + necessary expenses the injured party may have incurred in lieu of those she'd have performed for income. -- CAPPED at $2,000/month for not more than THREE YEARS from the date of the accident. -- Does NOT extend to loss of future earnings by person who's unemployed at the time of accident.

First-Party Benefits

First-Party Benefits include: (1) Basic Economic Loss -- ALL Medical Expenses -- Lost Earnings [CAPPED at $2,000/month for not more than THREE YEARS from the date of the accident. (2) Non-Income-Producing Expenses (up to $25/day, for no more than ONE YEAR from the date of the accident) (3) Deductions (20% loss of income deduction; Social Security disability benefit deduction; workers comp deduction) **NO Pain and Suffering: First-party benefits do NOT include non-economic loss (e.g., pain and suffering) [this is why ppl try to plead past the no-fault threshold so they can bring tort suit.

Insurance Requirement

Insurance is mandatory in NY. The insured must purchase insurance w/ both the required liability coverage and the required no-fault provisions.

Geographical Reach of No-Fault Coverage

No-fault coverage extends to the use/operation of an auto anywhere in NY or in any other state. Every non-resident insurer transaction business in NY or controlling/controlled by such an insurer must provide min. liability coverage and min. first-party benefits ($50,000) for any auto used/operated in NY.

No-Fault Insurance Purpose

No-fault insurance law is designed to screen "minor" automobile accident suits out of the litigative process, by requiring the P in a personal injury action to plead past the no-fault threshold (i.e., there must have been a serious injury or a loss greater than basic economic loss). The Act covers only injuries sustained in the use/operation of a motor vehicle (unclear whether this includes the entering/leaving/loading/unloading of a vehicle).

First-Party Benefits: Non-Income Producing Expenses

Non-Income-Producing Expenses includes costs incurred for things like household services normally performed by the injured covered person. Reasonable + necessary expenses are recoverable up to $25/day, for no more than ONE YEAR from the date of the accident.