Loss TransferDecember 15, 2016

Matter of Liberty Mut. Fire Ins. Co. v Global Liberty Ins. Co. of N.Y., 2016 NY Slip Op 08078 (2d Dept. 2016)

Here, in response to Liberty Mutual’s submission of evidence establishing the medical payments for which it sought reimbursement, Global failed to produce any evidence that any of the medical claims were improperly paid (see generally State Farm Mut. Auto. Ins. Co. v Stack, 55 AD3d 594, 595). Accordingly, the arbitrator’s determination that Liberty Mutual was not entitled to full reimbursement was not supported by evidence in the record and was arbitrary and capricious (see generally Matter of Progressive Cas. Ins. Co. v New York State Ins. Fund, 47 AD3d 633, 634).”

This case was interesting and really asked the Court how far it would take a hands off stance on getting involved in no-fault matters, whether it was a standard arbitration or loss transfer proceeding.  Here, there was no evidence of medical management in the file and the loss-transfer arbitrator noted the same.  Supreme Court and Appellate Division said this was insufficient to justify the underlying award.

What this case does, however, is give us a groundwork to defend or prosecute loss transfer claims.  A respondent carrier needs to provide affirmative proof, i.e., peer reviews or documentary evidence explaining why a file was not properly medically managed.   Quite interesting.


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