No Fault Insurance
Suit between covered person and noncovered person
A covered party cannot settle with uncovered unless: (1) covered person has written consent from insurer; (2) settlement approved by court; OR (3) amount of settlement exceeds $50,000. Insurer has a lien against recovery for all first-party benefits paid to covered person
When can you get into court?
(1) You suffered a serious injury or (2) Suffered a loss greater than basic economic loss. Basic Economic Loss = $50,000. This includes: medical expenses, lost wages (for 1 yr), and miscellaneous expenses (for 1 yr) Serious injury = death, dismemberment, significant disfigurement, a fracture, loss of a fetus, permanent loss or limitation of use of a body organ or member, permanent loss or limitation of use of a body function or system, or a nonpermanent injury that prevents injured from substantially performing usual routine for at least 90 days
First-Party Benefits
Do not get noneconomic loss (pain and suffering) Basic economic loss: (1) medical expenses - all necessary expenses (including psychiatric and professional health services (chiropractic)). No time limit on recovery of medical expenses so long as 1 year after date of accident, it is ascertainable that future expenses may be incurred as a result of the injury. (2) lost earnings - (i) loss earnings from work the insured would have earned had he not been injured - may include increases in salary but doesn't include future earnings by person unemployed at time of accident; (ii) reasonable and necessary expenses incurred by injured person in obtaining services in lieu of those he would have performed for income, including self- employed (tavern owners who hire after injury); (iii) recovery limited to 2000/month for not more than 3 years after accident (3) all other reasonable and necessary expenses incurred, up to $25/day for not more than one year after accident Deductions: (1) 20% from lost earnings (to reflect taxes) (2) amounts recovered under social security disability benefits or worker's compensation benefits (NOT Medicare, Medicaid, etc.) (3) family deductible up to $200 (4) catch-all provision for amounts deductible under the applicable insurance policy (5) policyholder can elect to have all or some of medical benefits portion of no-fault to be covered by health insurer
NY: Abolished Collateral Source Rule
New York has abolished the Collateral Source Rule, meaning that recoveries for past or future medical expenses in negligence cases must be reduced by any amounts that the plaintiff has received from other sources, such as insurance payments.
Geographical Problems
No-fault coverage extends nationwide Nonresidents driving in NY must provide minimum liability coverage (25/50/10) and minimum first-party benefits (50).
Purpose
Screen minor negligence suits out of litigation process - severity of injury matters
Who/what is covered
Only collect for personal injuries. No coverage for property damage (covered by liability insurance). For injuries caused by insured-owner's vehicle, "covered persons": (regardless of negligence/fault) (1) owner (2) any authorized driver (3) occupant of insured's auto (4) pedestrian hit by insured's auto If injured by uninsured motorist or insured motorist outside the state, "covered persons": named insured and spouse, child, and relatives who regularly reside in household (except for occupants of a motor vehicle) School buses - occupants entitled to first party benefits under bus's policy if the occupant is not covered by another policy providing first-party benefits Persons that may be excluded from coverage: (1) person occupying another motor vehicle (they look to their own no-fault policy) (2) a person injured: (i) by his own intentional act; (ii) while operating a vehicle intoxicated; (iii) while committing a felony or attempting to avoid a lawful arrest; (iv) while racing a vehicle; (v) while operating a vehicle known by him to be stolen; (vi) while operating or occupying a vehicle for while no-fault coverage is not in effect; (vii) while a pedestrian being struck by his own vehicle for which no-fault is not in effect; or (viii) while repairing, servicing, or maintaining a vehicle of the activity is within the course of a business of repairing or servicing, and the injury occurs on the business premises (only nonoperational conduct)
Procedure
P first gets no-fault recovery Plaintiff files personal injury action and must plead past the no-fault threshold. If challenged by a pre-answer motion to dismiss, P must make at least a primary facie showing that threshold has been crossed. If raised by D, court must make a preliminary examination to determine if "serious injury" criteria or "loss greater than economic loss" is met If P succeeds, bring a negligence claim and can recover: (1) property damage claims; (2) damages for wrongful death; (3) economic loss not included in "basic economic loss"; (4) noneconomic loss SofL runs on date of accident
Payment of first-party benefits
Paid as the loss is incurred (periodically). Claim must be paid within 30 days after claimant presents proof of the fact and amount of loss. Overdue payments bear interest at 2%/month and covered person can recover reasonable attorney's fees for services to claim overdue amount.
Motor Vehicle Accident Indemnification Corporation
Provides no-fault benefits to injured parties who, through no fault of their own, were involved in a motor vehicle accident with : (1) uninsured vehicles registered in a state other than NY; (2) hit and run vehicles; (3) stolen motor vehicles; (4) vehicles operated without owned's permission; (5) insured vehicles whose insurer denies coverage; (6) unregistered vehicles; (7) vehicles registered in NY but didn't have liability policy in effect at the time of accident
PreRequisite to Registration
Purchase of automobile insurance is required for liability coverage ($25,000 for bodily injury, $50,000 for death, and $10,000 for property damage) and no-fault coverage
No fault coverage generally
Together with liability coverage, the Act provides (1) up to $50,000 benefit to insured (basic economic loss); and (2) $25,000/$50,000/$10,000 minimum liability for 3rd party protection (if insured is sued by a 3rd party) Requirements: (1) Act covers only the "use of operation" of a motor vehicle; (2) Act applied to "covered persons"