Liang v Progressive Cas. Ins. Co., 2019 NY Slip Op 03327 (2d Dept. 2019)
“However, the Supreme Court should have granted that branch of Progressive’s motion which was for summary judgment dismissing the bad faith in denying benefits cause of action. “[I]n [*2]order to establish a prima facie case of bad faith, the plaintiff must establish that the insurer’s conduct constituted a gross disregard of the insured’s interests” (Pavia v State Farm Mut. Auto. Ins. Co., 82 NY2d 445, 453 [internal quotation marks omitted]) and that the “insurer engaged in a pattern of behavior evincing a conscious or knowing indifference to the interests of the insured” (Bennion v Allstate Ins. Co., 284 AD2d 924, 926 [internal quotation marks omitted]).
Here, Progressive established, prima facie, that it did not act in bad faith, since its conduct, under the circumstances, did not constitute a gross disregard of Liang’s interests. Progressive conducted an investigation and had an arguable basis for disclaiming coverage (see Financial Servs. Veh. Transit v Saad, 137 AD3d 849, 853; JLS Indus., Inc. v Delos Ins. Co., 127 AD3d 645, 646; S Bros. Inc. v Leading Ins. Servs., Inc., 124 AD3d 498, 499). In opposition, the plaintiff’s conclusory assertions failed to raise a triable issue of fact as to whether Progressive’s conduct constituted a gross disregard of Liang’s interests (see Bennion v Allstate Ins. Co., 284 AD2d at 926).
I like the term arguable basis for disclaiming coverage. Here, the issue was whether Plaintiff was a “resident”. There is a triable issue of fact on this score. Had there not been a triable issue of fact, would Progressive have had an arguable basis for disclaiming coverage? It is an interesting paradigm.
