The insurance company for the snow removal contractor was notified of the occurrence when the plaintiff slipped and fell. The claim was not resolved and the plaintiff sued the contractor. The contractor did not respond to the lawsuit and did not send the lawsuit papers to the insurer.
A few months later, before asking for a default judgment against the contractor, the plaintiff forwarded the suit papers to the insurer, together with medical information and authorizations for medical records. The insurer responded with a disclaimer, citing the contractor’s failure to give timely notice of the suit.
The underlying case went to trial and the plaintiff got a $3 million + judgment against the contractor. When the judgment went unsatisfied, the plaintiff sued the insurer as provided by New York statute.
The court held that the disclaimer was ineffective because it did not specify that the notice of lawsuit given by the injured party, as opposed to the policyholder, was untimely:
Where the required notice of suit is not provided by the insured, but rather by the injured party, the insurer’s notice of disclaimer must address with specificity the grounds for disclaiming coverage applicable to the injured party as well as the insured . . .
The opinion does not discuss the presence or lack of prejudice to the insurer at the time of the late notice.
Pollack v Scottsdale Ins. Co. (Oct. 12, 2016)