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Keywords

arbitrationliabilitymotion

plaintiffdamagesarbitrationliabilitymotionwillrespondent

Related Cases

United Community Ins. Co. v. Mucatel, 127 Misc.2d 1045, 487 N.Y.S.2d 959

Facts

On November 15, 1983, Shirley Mucatel was injured while a passenger in her husband's vehicle during a collision with another car insured by Allstate Insurance Co., which paid $10,000. Mucatel sought to claim under her husband's underinsured motorist policy with United Community Insurance Co., which offered $15,000, claiming this was the limit after deducting the payment from Allstate. Mucatel contended she was entitled to $50,000 without any offset, leading to a demand for arbitration.

Respondent, in her demand for arbitration, alleges that she is entitled to the full underinsured motorist coverage included in her husband's policy without any offset.

Issue

Whether the reduction clause in the underinsured motorist policy should be enforced, thereby limiting the amount payable to the insured based on payments from other insurers.

Rule

Insurance Law Section 167(2–a) mandates that automobile liability policies provide supplementary uninsured motorist insurance, and any ambiguity in an insurance policy must be construed against the insurer.

Insurance Law Section 167(2–a) requires all automobile liability policies to provide, at the option of the insured, supplementary uninsured motorist insurance which will cover the insured if the liability limits of another motor vehicle (which is liable for damages) are less than the liability limits under the insured's own policy.

Analysis

The court found that the reduction clause in the insurance policy was misleading and ambiguous, as it did not reflect the insurer's intention clearly. The court referenced a similar case where a reduction clause was declared void, emphasizing that ambiguities in insurance policies should favor the insured. Thus, the court ruled that Mucatel was entitled to the full underinsured motorist coverage without any offset.

The reduction in coverage clause in the endorsement should not be given effect and respondent is entitled to the underinsured motorist coverage included in her husband's policy without an offset.

Conclusion

The court denied the insurer's motion to stay arbitration, affirming that Mucatel was entitled to the underinsured motorist coverage included in her husband's policy without an offset, but clarified that the maximum amount recoverable was $25,000.

For the foregoing reasons, the motion to stay arbitration is denied.

Who won?

Shirley Mucatel prevailed in the case because the court ruled that the reduction clause in her husband's insurance policy was void, allowing her to claim the full underinsured motorist coverage.

The court found for the plaintiff and declared the policy's reduction clause void.

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