American Country Insurance loses PIP dispute; must reimburse Assigned Claims insurer for payment
A woman named Alexandria Turner suffered mild injuries in two successive car accidents in two successive months in 2009. There was no coverage on the first accident, but American Country insured the vehicle Turner occupied in the second accident. Because Turner was not the owner of the uninsured car in the first accident, she was allowed to collect PIP benefits from the Assigned Claims plan, through Titan Insurance Company. When American Country refused to pay any benefits on the second claim, the Assigned Claims also assigned Titan to manage that claim.
Titan notified American Country of its obligation regarding the second collision, however, Titan declined to assume its duty of managing the claim. Titan the resolved the claim for $25,000.00 and sued American Country for reimbursement. American Country argued that Titan should not have paid on the claim and therefore it was owed no reimbursement. The trial judge and the Court of Appeals rejected this argument. The courts held that since Titan owed a statutory duty to manage the assigned claim, and since American Country refused to honor its duty to assume the management of the claim, American Country was stuck with the deal Titan made.