Volume XXIII, No. 4 February 18, 2011
From the Co-Editors
James L. Borin & Simeon R. Orlowski
YOURS, MINE & OURS UNDER 3114
CONTRIBUTOR – THOMAS G. HERMAN
The Michigan Court of Appeals recently issued an interesting opinion interpreting the right of recoupment when a person is a named insured on more than one policy. Farm Bureau v Michigan Catastrophic Claims (Docket #293747, issued December 21, 2010) held there was no right to recoupment when the claimant was a sole named insured on one policy, but was also a named insured with her husband on a different policy. The issue became even more important when the Michigan Catastrophic Claims Association refused to reimburse until both policy retentions were exhausted.
Farm Bureau insured two cars titled solely to Mrs. Ross. The Farm Bureau policy solely listed Mrs. Ross as the named insured. American International insured a third vehicle titled solely to Mr. Ross. The American International policy, however, listed both Mr. and Mrs. Ross as named insureds. The couple testified that they considered the Farm Bureau policy as covering Mrs. Ross and the American International policy as covering Mr. Ross. Although they both utilized a joint checking account, Mrs. Ross wrote the premium checks to Farm Bureau while Mr. Ross wrote the checks to American International.
Section 3114 includes the provision, “When personal protection benefits . . . are payable to or for the benefit of an injured person under his or her own policy and would also be payable under the policy of his or her spouse, relative, or relative’s spouse, the injured person’s insurer shall pay all of the benefits and shall not be entitled to recoupment from the other insurer.” The Court held that the Farm Bureau policy insured the injured claimant, Mrs. Ross. The American International policy insured both the claimant and her husband. 3114 does not require that the spouse be the sole named insured under the second policy. Although Mrs. Ross was also a named insured on the second policy, American International did not have to share in the PIP benefits to Mrs. Ross. Farm Bureau was, therefore, entitled to reimbursement beyond the then applicable $250,000 MCCA limit, rather than the $500,000 limit argued by the MCCA.
Under this opinion, in order to share in PIP coverage, it is no longer sufficient to simply find that the claimant is also a named insured on another policy. If the second policy also insures other relatives, that may prevent a claim for recoupment under 3114.
GRAND RAPIDS BREAKFAST SEMINAR
The Grand Rapids Breakfast Seminar will be held at the Frederik Meijer Gardens & Sculpture Park on Wednesday April 13, 2011. An agenda will follow shortly. To register for this seminar please contact Lynn Beatty at email@example.com
GLM SPRING DEPOSITION BOOT CAMP
Please be advised that the Deposition Boot Camp being presented on March 2, 2011 is filled to capacity. Please note that Garan Lucow Miller is planning on hosting another Boot Camp at a later date. Please watch Law Fax for further details.