The legislature was off for the summer and thus we had some respite from the relentless attack on our No-Fault system. Now that the legislature is back in session, No-Fault legislation remains a high priority for the insurance industry. Already they have snapped into action with House Bill 4959 which would exempt Medicare eligible drivers from the No-Fault system. This is a bad idea for many reasons. The most obvious is that No-Fault succeeds when we have a large pool of contributing drivers. Any effort to remove drivers from the system diminishes the pool and hence the strength of the system. It's also a bad idea for elderly drivers. The siren song of lower premiums will seduce many to opt out of No-Fault coverage, leaving them without the wonderful coverages that we rely on in cases of serious injury. Even the medical benefits that are covered by Medicare are not as extensive as provided by No-Fault so that the injured elderly will have to pay out of pocket for certain items. THIS BILL IS ANOTHER ILL ADVISED EFFORT AT "REFORM." So it is time for us once again to step up and be vigilant about this process. We will continue to keep you informed as the fall progresses.

MOTORCYCLE V MOTOR VEHICLE ACCIDENTS

BEWARE OF ISSUES REGARDING YOUR ENTITLEMENT TO NO-FAULT COVERAGE

We want to alert you to a very disconcerting trend in cases seeking No-Fault benefits for motorcycle/motor vehicle accidents. As you may know, No-Fault benefits are available to those injured in "motor vehicle" accidents. Strangely, motorcycles are not considered to be "motor vehicles" under the No-Fault Law. However, motorcyclists may still get No-Fault benefits if the injury arises out of the use of a motor vehicle (e.g., a car or truck). Motorcycles that have actual physical contact with a moving motor vehicle easily satisfy this test. The disconcerting recent trend regards motorcyclists who do not make physical contact with the motor vehicle, but rather who are injured while taking evasive action. In one recent case, a motorcyclist saw a car with headlights coming his way and laid his bike down to avoid the collision.   

In another case, a motorcyclist suddenly came up behind a truck that was slowing down to turn left. Again, the motorcyclist laid her bike down to avoid the collision. Serious injuries resulted in both cases. In both cases, the Court of Appeals found that the involvement of the motor vehicle was not sufficiently close to invoke No-Fault coverage. We believe both conclusions are erroneous and appeal is being sought. But at this point, be aware that courts appear to be taking a more stringent view of coverage in cases where motorcyclists are injured in cases that do not involve actual physical contact with motor vehicles.

LEGAL DECISIONS AND SETTLEMENTS

SUPREME COURT LIMITS INSURER'S LIABILITY FOR MODIFIED VAN COST - THREE MONTHS LATER

M&T'S June, 2013 Newsletter discusses Admire v Auto Owners Ins Co which we characterized as perhaps the most important decision on "'allowable expenses'" in years.  To recap, in Admire, the Supreme Court held that a No-Fault insurer is only required to pay the cost of van modifications and not the base price of the van since the cost of the van and the cost of modifications are easily separable.  We noted that Admire is a van case, not a housing case, but that it overturned two housing cases that used an incremental approach to payment for housing. 

To date, we are unaware of any appellate decision that applies Admire to a claim for housing.  Nevertheless, as previously suggested, Admire impacts claims for housing modifications.  For one client, a proposed agreement for housing accommodations awaiting final approval from the reinsurer (the Michigan Catastrophic Claims Association) at the time the Supreme Court issued Admire returned to us for renegotiation in light of Admire.

While M&T continues to view Admire as tragic, careful strategic planning can produce positive outcomes.  For example, those who regularly attend medical appointments at considerable distance from the house may cause the insurer to incur transportation costs with a transportation company or a rental van far in excess of the cost of purchasing a modified van.  For one client, with a foreign automobile insurer responsible for his PIP benefits, this precise scenario forced the insurer to consider the purchase of a modified van so as to avoid greater transportation costs with other arrangements.  In another instance, a No-Fault insurer secured approval from the MCCA for the purchase of a modified van as part of a settlement that included a waiver of an otherwise compelling claim for penalty attorney fees.  While each situation is different, M&T continues to work with each client in need of modified transportation to create a unique solution to best overcome Admire.