Nationwide v. Ramos

Lower Court Index No. 11106/16

Supreme Court – State of New York – Suffolk County

Hollander Legal Group Successful In Permanently Staying Arbitration Seeking Underinsured Motorist Benefits

In action seeking underinsured motorist benefits, Hollander Legal Group successfully obtained a permanent stay of arbitration. The action involved a policyholder, the Respondent, who had procured an insurance policy from the Petitioner, an insurance company, and subsequently requested cancellation of that policy. At the same time that the Respondent requested cancellation, the Respondent had obtained a policy from another insurance company, the Proposed Additional Respondent, with lower policy limits. Within twenty-four hours of requesting the cancellation, the Respondent was involved in a severe accident and subsequently rescinded his request to cancel the policy. Recognizing that the policy issued by the Petitioner provided greater coverage, the Respondent sought to arbitrate his claim for Underinsured Motorist benefits against the Petitioner.

Adding a twist to the circumstances, when Respondent had sought to cancel the policy, he contacted his independent insurance agent who had advised him against the decision. However, the Respondent advised that he obtained a policy from the Proposed Additional Respondent with lower policy limits, at a reduced cost. The insurance agent requested that the Respondent put the request in writing so that it may be transmitted to the Petitioner, to which the Respondent agreed. However, due to the fact that the accident occurred shortly thereafter, the communication was never submitted to the Petitioner and the policy was not cancelled by the Petitioner at the time of the loss.

The Petitioner, represented by Hollander Legal Group, sought to permanently stay the arbitration arguing that by operation of law, the policy of insurance issued by the Petitioner was cancelled. Counsel argued that Respondent’s intention was clear, in that he wanted to cancel the policy to obtain a cheaper policy from the Proposed Additional Respondent. In fact, the Respondent carried through with his intention by obtaining a policy from the Proposed Additional Respondent. Our attorney’s were able to successfully argue that pursuant to the Vehicle and Traffic Law, although the Petitioner did not formally cancel the policy, the policy was cancelled by operation of law due to the intent of the Respondent and the procurement of the policy from the Proposed Additional Respondent.

After a framed issue hearing was held, the Supreme Court, Suffolk County, ordered that the petition seeking to permanently stay the request for underinsured motorist arbitration was granted.

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