SUM game changer

Matter of Government Empls. Ins. Co. v Sherlock, 2016 NY Slip Op 04414 (2d Dept. 2016)

For those of you who practice in the UM and SUM arenas, this case is a total game changer.   I am grateful my name is not attached to the insurance carrier on this case.  I believe I would go into hiding or get lost on a long trial.  Conversely, when I put my Plaintiff hat on, I  realized that I just stepped into a pile of gold.

Here’s my summary:

(1) SUM carrier still gets condition 6 offset based upon benefits paid by third-party motor vehicle insurance tortfeasor carrier;

(2) SUM carrier does not get direct offset for benefits that a non-motor vehicle insurance carrier pays.  Rather, the gross award at arbitration is reduced by the amount of third party benefits collected and the Claimant is entitled to the lesser of this amount or the net SUM benefit available.

Essentially, the Court has stripped away the concept that SUM is a ceiling and that it is not permissible to  obtain benefits greater than that ceiling.  This is a big decision for Claimants who obtain settlements and verdicts in MVAs from tortfeasors other than motor vehicles.

Consider the motor vehicle accident that is caused by the City’ negligence in maintaining the roadway; the errant cow that escaped pasture; the stray bullet that hits your car, etc.

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