Comp award does not prevent uninsured motorist benefits- New York
While driving a car owned by the self-insured employer, an employee was in an accident with another car, driven by a person without liability insurance. The employee sought uninsured motorist benefits from the employer through arbitration but a trial court granted a stay of arbitration.
However, an appellate court reversed and allowed arbitration to proceed. The employer argued that because the employee is entitled to Workers’ Comp benefits, he is barred from recovering uninsured motorist benefits. While New York state law says an employer’s liability for Workers Comp benefits “shall be exclusive and in place of any other liability whatsoever,” the high court found that wording “cannot be taken literally” in all cases.
“Specifically, the statute cannot be read to bar all suites to enforce contractual liabilities,” the court ruled. “If an employer agrees, as part of a contract with an employee, to provide life insurance or medical insurance, and breaches that contract, an action to recover damages for the breach would not be barred.” It determined that there is no policy reason why uninsured motorist protection should decrease because the employee happened to be driving the car of a self – insurer.
Info from January WorkComp Advisory Newsletter