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Showing posts with label Massachusetts Insurers Insolvency Fund. Show all posts
Showing posts with label Massachusetts Insurers Insolvency Fund. Show all posts
Tuesday, December 29, 2015
SJC holds that separate limits apply to family members seeking coverage under Massachusetts Insurers Insolvency Fund
I wrote here about the Superior Court decision in Mass. Insurers Insolvency Fund v. Smith, which held that the statutory claim limit of $299,999 applies separately to individual family members seeking primary and loss of consortium damages from the Massachusetts Insurers Insolvency Fund.
In 458 Mass. 561 (2010) the Supreme Judicial Court affirmed that decision. The court held that allowing only one limit would substitute the word "occurrence" for the word "claim" in the statute.
Thursday, November 26, 2015
SJC holds that workers' compensation self-insurance group is an insurer
I posted here about a Superior Court decision in Mass. Care Self-Ins. Group, Inc. v. Mass. Insurers Insolvency Fund . That case held that a worker's compensation self-insurance group, Mass Care, is an insurer within the meaning of Mass. Gen. Laws ch. 175D, which creates a fund that provides insurance benefits when an insurer that would otherwise provide coverage has become insolvent.
Mass Care provided coverage up to a self-insured retention limit to an injured employee of one of its members. The group had an excess carrier over the SIR that had become insolvent. When the damages paid to the injured employee exceeded the SIR, the group sought coverage from the fund.
The Superior Court held that the group was not entitled to reimbursement, because the Fund does not reimburse insurers.
In Mass. Care Self-Ins. Group, Inc. v. Mass. Insurers Insolvency Fund, 458 Mass. 268 (2010), the SJC affirmed.
The SJC adopted the dictionary definition of insurer as "[o]ne who agrees, by contract, to assume the risk of another's loss and to compensate for that loss." The court noted that Mass Care accepts premiums in exchange for the provision of workers' compensation coverage, and described its functions as including many operations ordinarily associated with the insurance business. Without more, Mass Care would be considered an insurer.
The court then turned to the enabling statute, Mass. Gen. Laws ch. 152 §§25E-25U, under which Mass Care and other worker's compensation self-insurance groups are created. It noted that §25E states that self-insurance groups are not to be deemed insurers, and that the reason is to prevent such groups from being subject to the traditional framework of insurance regulation. However, the definitions section of the statute, Mass. Gen. Laws ch. 152 §1(7), makes self-insurance groups subject to consumer laws and regulations applicable to workers' compensation insurers.
The court reconciled the clauses and concluded that Mass Care is a member of the insurance industry whom ch. 175D was not intended to benefit.
Tuesday, November 24, 2015
Superior Court holds that Massachusetts Insurance Insolvency Fund must apply separate caps to loss of consortium claims
In Massachusetts Insurers Insolvency Fund v. Smith, 2009 WL 3199209 (Mass. Super.), Judge Fabricant of the Superior Court held that separate limits apply to a main claimant and claimants seeking coverage for loss of consortium from the Massachusetts Insurers Insolvency Fund.
The Fund is an entity created by statute that pays claims on behalf of insolvent insurance companies; but by statute it pays "only that amount of each covered claim which . . . is less than three hundred thousand dollars."
Mason was a medical provider who had malpractice insurance with an insurer that is now insolvent. His policy had a coverage limit of $1,000,000.
Mason was sued by a patient for physical injury and by the patient's family members for loss of consortium. The Fund argued that the aggregate amount it could pay to all of the claimants--the patient and the family members--was $300,000. The claimants argued that the $300,000 cap applied to each of their claims individually.
Judge Fabricant noted that no Massachusetts appellate decision has addressed this question and that the Superior Court and extra-jurisdictional decisions are split. She held, based on the language of the original policy and the statute enabling the fund, that the fund must pay up to $299,999 on each separate claim.
Sunday, May 3, 2015
SJC holds that Massachusetts Insurers Insolvency Fund is subject to 93A liability
In Wheatley v. Mass. Insurers Insolvency Fund, 456 Mass. 594 (2010), the Supreme Judicial Court of Massachusetts held that the Massachusetts Insurers Insolvency Fund is subject to suits for breach of Mass. Gen. Laws ch. 93A when it breaches Mass. Gen. Laws ch. 176D, § 3(9). (See here for an explanation of the statutory scheme.)
The Insolvency Fund is an entity created by statute to provide insurance coverage when the insurer on the risk is no longer in business.
The court held that it was subject to 93A liability to the same extent as insurance companies because of statutory language of 93A and 176D.