We Try Harder, Inc. v. Allcity Ins. Co.
| Decision Date | 06 April 1983 |
| Citation | 460 N.Y.S.2d 909,118 Misc.2d 626 |
| Parties | WE TRY HARDER, INC., Plaintiff, v. ALLCITY INSURANCE CO., Defendant. |
| Court | New York City Court |
Gerald M. Serlin, Westbury, of counsel, for plaintiff.
Raymond J. MacDonnell, New York City, Martin Muhlrad, of counsel, for defendant.
This case presents the single issue of the effective date of coverage under an insurance policy issued pursuant to New York State's assigned risk automobile insurance program. It is uncontested that the plaintiff was awarded a default judgment for $1,422.01 against the insured and then commenced this suit directly against the defendant insurance company as is permitted by Section 167 of the Insurance Law. The dispute is limited to whether the policy became effective before or after the accident.
It requires a close examination of the rules governing assigned risk automobile policies to determine the effective dates of insurance coverage. The assigned risk program was created pursuant to Section 63 of the Insurance Law and, in accord with those provisions, an entity was created which was named the New York Automobile Insurance Plan. Its procedures are promulgated in a manual entitled the "New York Automobile Insurance Plan," which were approved by the State Superintendent of Insurance and which are hereinafter referred to as the "Plan Rules." It appears that an assigned risk policy for an individual passenger automobile, as is involved here, may come into being in three different ways.
The first method is by application to a broker who may issue a "temporary identification card." Although the broker's obligations are not clearly presented, it does appear that such a broker must receive an application and premium deposit before issuance of a temporary identification card. See generally Section 11 of the Plan Rules and, more particularly, Section 11(F)(1)(c). If a broker's temporary identification card is used to register the vehicle, coverage commences upon registration of the vehicle. Plan Rules § 11(F)(1). See also Aetna Casualty and Surety Co. v. Providence Washington Co., 55 A.D.2d 924, 390 N.Y.S.2d 631 (2nd Dept., 1977), leave to appeal denied 42 N.Y.2d 803, 397 N.Y.S.2d 1028, 366 N.E.2d 1364 (1978), affirming an estoppel to deny coverage although the insurer had not received notice of assignment of the risk under the special circumstances of that case as presented in the opinion of the trial court (Index No. 13820/75, Sup.Ct., Nassau Co., Derounian, J.).
The second method is one in which the assigned risk plan itself establishes the date of coverage. See generally Section 12(A) of the Plan Rules. In such a case, the broker has not issued a temporary identification card and submits the application form and deposit to the plan. The plan itself establishes the effective date, which may not be before the receipt of the application and deposit by the plan. The plan may issue a temporary identification card to the insured under this method.
The third method is one in which the effective date is established by the insurance company itself under Section 14(A) of the Plan Rules. This procedure is to be used only if the commencement date is not established under one of the two ways outlined above.
In the instant case, the plaintiff believes that the policy came into being under the first procedure, which would advance coverage to a date preceding the accident. The insurance company argues that it assigned an effective date to the policy as it was instructed to do by the assigned risk plan, presumably consistent with the second procedure, and that such date of coverage fell after the accident.
The plaintiff rested its proof as to the effective date of insurance coverage upon the presentation of a memorandum produced by the New York State Department of Motor Vehicles which stated that the policy had become effective upon the date of registration. That memorandum, known as an "FS-25," is the subject of question as to its...
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Eagle Ins. Co. v. Barraeau
...date of the receipt of the application and deposit. The court finds support for this position in We Try Harder, Inc. v. Allcity Ins. Co., 118 Misc.2d 626, 460 N.Y.S.2d 909 (N.Y.C.Civ.Ct.1983) which delineates three methods in which coverage becomes effective under Plan Rules and differentia......