Key Takeaway
New York court dismisses workers compensation policy suit, ruling insurer can raise lack of coverage defense regardless of claim denial timing or propriety.
Understanding Coverage Defenses in Workers Compensation Insurance Disputes
Insurance coverage disputes often involve complex questions about policy language, exclusions, and the scope of protection. A recent New York appellate court decision highlights an important principle: insurers can assert lack of coverage defenses even when there are questions about how they handled claim denials.
The case of Ultimate Health Prods., Inc. v Hereford Ins. Co. demonstrates how courts analyze coverage disputes when different types of insurance policies become entangled. This situation commonly arises in New York’s complex insurance landscape, where businesses may carry multiple policies and where workers compensation defense requires substantiation to succeed in court.
The underlying dispute centered on whether a workers compensation policy could be used to cover first-party no-fault benefits—two distinct types of insurance coverage that serve different purposes under New York law.
Jason Tenenbaum’s Analysis:
Ultimate Health Prods., Inc. v Hereford Ins. Co., 2016 NY Slip Op 50367(U)(App. Term 2d Dept. 2016)
“Contrary to plaintiff’s contention, a lack of coverage defense may be raised without regard to any issue as to the propriety or timeliness of an insurer’s denial of claim form (see Zappone v Home Ins. Co., 55 NY2d 131, 135-136 ; see also Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195 ). The papers submitted by defendant in support of its cross motion were sufficient to establish that the policy being sued upon was a workers’ compensation insurance policy which did not cover plaintiff’s claim to receive reimbursement of assigned first-party no-fault benefits. As plaintiff failed to demonstrate the existence of an applicable automobile insurance policy issued by defendant or to otherwise raise a triable issue of fact in opposition to defendant’s cross motion, the order is affirmed.”
It is always interesting seeing cited to insurance companies and entities that do not exist. What happened to Home Ins Co.? Central General in Plainview, New York have been part of North Shore/LIJ for about 20 years.
Key Takeaway
This decision reinforces that insurers can successfully defend coverage lawsuits by demonstrating the policy type simply doesn’t cover the claimed benefits. Courts will dismiss cases where plaintiffs cannot establish that the right type of policy exists or that coverage should apply, regardless of procedural issues with claim handling.
Related Articles
- Workers compensation defense requires substantiation in court
- Workers Compensation Defense in No-Fault Cases: Standing vs. Exclusion Analysis
- Why does a Malella defense survive an untimely disclaimer, while a workers compensation defense doesn’t?
- Priority coverage disputes between no-fault insurance and workers compensation in New York
- Workers Compensation Defense in No-Fault Cases: Specialized Expertise Required
