Mega Supply & Billing, Inc. v American Tr. Ins. Co. (2005 NY Slip Op 51569(U))

Civil Court, Kings County

96502/04

Eileen N. Nadelson, J.

Plaintiff, a medical provider, instituted this action to recover first party No-Fault benefits from Defendant insurer. Plaintiff moved for summary judgment, alleging that Defendant neither paid nor denied the claim within the statutorily mandated thirty-day period after receipt of the claims. Ins. Law sec. 5106; Regulations sec. 65-3.8. Plaintiff further alleged that the Denial of Claim form (NF-10) was defective in that it did not indicate the reason for the denial with specificity as is required by section 65-3.4( c) of the Regulations.

Defendant, in opposition, claimed that the denials were timely and that the grounds for the denial are sufficiently specific to apprise Plaintiff as to the reasons for not paying the claim.

After argument, the court has concluded that the NF-10 form was properly mailed within the statutory time frame. Consequently, the only issue remaining for the court is whether Defendant’s reason for the denial, as stated in its Denial of Claim form, is legally sufficient to forestall Plaintiff’s motion for summary judgment. [*2]

The explanation for Defendant’s denial of the first party benefits, as stated in section 33 of its NF-10, is: “The Claim is Denied Based On An Examination Under Oath.”

In 1979, the New York Court of Appeals established the general guidelines for insurers when denying coverage. According to General Accident insurance Group v. Cirucci, 46 NY2d 862, 414 N.Y.S. 2d 512 (1979):

...the notice of disclaimer must promptly apprise the claimant with a high

degree of specificity of the ground or grounds on which the disclaimer is

predicated. Absent such specific notice, a claimant might have difficulty

assessing whether the insurer will be able to disclaim successfully. This

uncertainty could prejudice the claimant’s ability to ultimately obtain

recovery. In addition, the insurer’s responsibility to furnish notice of the

specific ground on which the disclaimer is based is not unduly burdensome,

the insurer being highly experienced and sophisticated in such matters.

Therefore, a timely denial alone does not avoid preclusion of a provider’s motion for summary judgment where said denial is factually deficient, conclusory, vague or otherwise involves a defense which has no merit as a matter of law. Nyack Hospital v. Metropolitan Property & Casualty Ins. Co., 16 AD3d 564, 791 N.Y.S. 2d 658 (2d Dept. 2005); Nyack Hospital v. State Farm Mut, Auto. Ins. Co., 11 AD3d 664, 784 N.Y.S. 2d 136 (2d Dept. 2004).

The blanket statement of Defendant on its NF-10 is too vague and ambiguous to alert Plaintiff as to the actual grounds for the denial of benefits. Stating that a denial is based on an Examination Under Oath, without indicating what about that examination merits denial of first-party benefits under No-fault law, does not set forth a factual basis on which to mount a meritorious legal defense. Park Neurological Services, P.C. v. Geico Insurance, 4 Misc 3d 95, 782 N.Y.S. 2d 507 (Sup. Ct. App. Term 2004). Therefore, because Defendant’s explanation of its reasons for denying Plaintiff’s claim on its NF-10 form was not stated with a high degree of specificity, it is insufficient to overcome Plaintiff’s summary judgment motion. All-Country Medical & Diagnostic P.C. v. Progressive Casualty Insurance Co., 8 Misc 3d 616, 795 N.Y.S. 2d 434 (Nassau County 2005).

The clerk is ordered to enter judgment in favor of Plaintiff in the amount of $1024.00, plus statutory interest, costs and attorneys’ fees.

Dated: October 3, 2005

__________________________

EILEEN N. NADELSON, J.C.C.