Key Takeaway
Another New York no-fault insurance case demonstrates that insurers must prove policy exhaustion with specific timing evidence to successfully defend coverage claims.
Understanding Policy Exhaustion in No-Fault Insurance Claims
No-fault insurance carriers often attempt to escape liability by claiming their policy limits have been exhausted. However, New York courts require more than just assertions — insurers must provide concrete evidence that the policy was actually exhausted at the specific time a claim was completed. This seemingly technical requirement can make or break a coverage dispute.
The timing element is crucial in New York No-Fault Insurance Law. Courts examine whether the insurer can demonstrate that available coverage had been depleted before the particular claim at issue reached completion. Without this proof, exhaustion defenses typically fail, as demonstrated in numerous appellate decisions.
Jason Tenenbaum’s Analysis:
Advanced Recovery Equip. & Supplies, LLC v Park Ins. Co., 2018 NY Slip Op 51630(U)(App. Term 2d Dept,. 2018)
“Contrary to defendant’s argument, it failed to establish, as a matter of law, an exhaustion of the coverage limits of the insurance policy at issue, as it did not demonstrate that the policy had been exhausted at the time the claim at issue was complete (see 11 NYCRR 65-3.15; Alleviation Med. Servs., P.C. v Allstate Ins. Co., 55 Misc 3d 44 ; see also Nyack Hosp. v General Motors Acceptance Corp., 8 NY3d 294 ). Consequently, defendant did not establish its entitlement to summary judgment dismissing the complaint.”
Nothing new here.
Key Takeaway
Insurance companies cannot simply claim policy exhaustion without providing detailed evidence of when and how coverage limits were reached. The burden remains on insurers to prove exhaustion occurred before the specific claim was completed, following established precedent in no-fault coverage disputes.
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