AIU Insurance v. Investors Insurance

Appellate Division of the Supreme Court of New York

AIU Insurance v. Investors Insurance

17 A.D.3d 259, 793 N.Y.S.2d 412, 2005 N.Y. App. Div. LEXIS 4282

CourtAppellate Division of the Supreme Court of the State of New York

DecidedApril 26, 2005

StatusPublished

Cited by8 cases

This text of 17 A.D.3d 259 (AIU Insurance v. Investors Insurance) is published on Counsel Stack Legal Research, covering Appellate Division of the Supreme Court of the State of New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook

AIU Insurance v. Investors Insurance, 17 A.D.3d 259, 793 N.Y.S.2d 412, 2005 N.Y. App. Div. LEXIS 4282 (N.Y. Ct. App. 2005).

Pincite

Opinion

Order, Supreme Court, New York County (Louis B. York, J.), entered March 17, 2004, which, upon reargument, vacated a prior order, same court and Justice, entered May 28, 2003, and declared defendant obligated neither to coinsure plaintiff Arnell Contracting nor to reimburse plaintiff AIU Insurance for defense and indemnification, unanimously affirmed, without costs.

Defendant, which directly insured Arnell, did not receive any notice of the underlying accident for five years. AIU Insurance, [260]*260which also insured Arnell under a “wrap-up” policy issued to plaintiff New York City School Construction Authority, undertook the costs of defense of the personal injury lawsuit. AIU made a demand to defendant to coinsure Arnell after the litigation had been ongoing for four years.

While an insurer must give timely notice of disclaimer to its insured even where, as here, the insurer has not in the first instance received timely notice of the accident (see Matter of Nationwide Mut. Ins. Co. v Steiner, 199 AD2d 507 [1993]), the duty to disclaim as soon as is reasonably possible (Insurance Law § 3420 [d]) is not triggered where, as here, the request is for contribution by a coinsurer (Tops Mkts. v Maryland Cas., 267 AD2d 999, 1000 [1999]). “The purpose of Insurance Law § 3420 (d) is to protect the insured, the injured party ‘and any other interested party who has a real stake in the outcome’ from prejudice resulting from a belated denial of coverage” (id., quoting Excelsior Ins. Co. v Antretter Contr. Corp., 262 AD2d 124, 127 [1999]). That the protection of the statute is inapplicable to a coinsurer’s request for contribution is demonstrated by the facts of this case. AIU received notice of the accident, conducted an investigation, undertook the defense of the lawsuit and managed the defense on its own for four years. Manifestly, it has not been prejudiced by any late disclaimer by Investors. Concur—Tom, J.P., Saxe, Ellerin, Nardelli and Sweeny, JJ.

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Order, Supreme Court, New York County (Louis B. York, J.), entered March 17, 2004, which, upon reargument, vacated a prior order, same court and Justice, entered May 28, 2003, and declared defendant obligated neither to coinsure plaintiff Arnell Contracting nor to reimburse plaintiff AIU Insurance for defense and indemnification, unanimously affirmed, without costs.

Defendant, which directly insured Arnell, did not receive any notice of the underlying accident for five years. AIU Insurance, [260]*260which also insured Arnell under a “wrap-up” policy issued to plaintiff New York City School Construction Authority, undertook the costs of defense of the personal injury lawsuit. AIU made a demand to defendant to coinsure Arnell after the litigation had been ongoing for four years.

While an insurer must give timely notice of disclaimer to its insured even where, as here, the insurer has not in the first instance received timely notice of the accident (see Matter of Nationwide Mut. Ins. Co. v Steiner, 199 AD2d 507 [1993]), the duty to disclaim as soon as is reasonably possible (Insurance Law § 3420 [d]) is not triggered where, as here, the request is for contribution by a coinsurer (Tops Mkts. v Maryland Cas., 267 AD2d 999, 1000 [1999]). “The purpose of Insurance Law § 3420 (d) is to protect the insured, the injured party ‘and any other interested party who has a real stake in the outcome’ from prejudice resulting from a belated denial of coverage” (id., quoting Excelsior Ins. Co. v Antretter Contr. Corp., 262 AD2d 124, 127 [1999]). That the protection of the statute is inapplicable to a coinsurer’s request for contribution is demonstrated by the facts of this case. AIU received notice of the accident, conducted an investigation, undertook the defense of the lawsuit and managed the defense on its own for four years. Manifestly, it has not been prejudiced by any late disclaimer by Investors. Concur—Tom, J.P., Saxe, Ellerin, Nardelli and Sweeny, JJ.

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Bluebook (online)

17 A.D.3d 259, 793 N.Y.S.2d 412, 2005 N.Y. App. Div. LEXIS 4282, Counsel Stack Legal Research, https://law.counselstack.com/opinion/aiu-insurance-v-investors-insurance-nyappdiv-2005.

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