When Is Bodily Injury "Caused by an Accident" for Purposes of Supplementary Uninsured/Underinsured Motorists Coverage?

SUPPLEMENTARY UNINSURED/UNDERINSURED MOTORISTS COVERAGE – INTENTIONAL ACTS – "ACCIDENT"

Matter of Progressive Advanced Ins. Co. (Widdecombe)
(3rd Dept., decided 1/4/2018)

You heard and paid attention to those Friends Don't Let Friends Drive Drunk ads.  You (Widdecombe) try to stop your friend (Germain) from driving drunk by following your staggering friend out the bar, sticking your foot in your friend's open car door and reaching for the ignition keys.  Undeterred and undaunted, your friend  screams that he's going to cut your leg off, starts his car, begins to drive off, trapping your foot, and drags you 20 feet, injuring your leg.  In addition to being not sober your friend was not insured, so you make a supplementary uninsured motorist (SUM) coverage claim to your own auto insurer.  What does your SUM insurer do?

Progressive disclaimed SUM coverage to its insured, Widdecombe, and commenced this special proceeding to permanently stay the SUM arbitration, contending that: (1) the Germain vehicle was not uninsured; (2) SUM coverage was excluded by the policy's intentional acts exclusion; and (3) Widdecombe's injuries did not result from an accident.  After conducting an evidentiary framed-issue hearing, Supreme Court granted Progressive's petition and permanently stayed arbitration of Widdecombe's SUM claim.  Widdecombe appealed.

In REVERSING Supreme Court's order and denying Progressive's petition to stay the SUM claim arbitration, the Third Department held:

(1) Supreme Court correctly ruled that the Germain vehicle was uninsured because none of his auto policies, including his most recent Hartford policy, was in effect on the incident date;

(2) Supreme Court erred in finding that an intentional acts exclusion in Widdecombe's policy with Progressive negated SUM coverage; Widdecombe's policy did not contain an intentional acts exclusion for UM or SUM coverage or anything similar to it; and

(3) whether Widdecombe's injuries were from an "accident" had to be determined from Widdecombe's perspective, not Germain's; whatever Germain's intent and criminal liability, the incident was an accident from Widdecombe's perspective:

We now turn to the dispositive question on appeal, which is whether Widdecombe's injuries were caused by an accident within the meaning of his policy with petitioner. Widdecombe's policy included SUM coverage, for which he paid a premium, providing for payment of "all sums that the insured . . . shall be legally entitled to recover as damages from the owner or operator of an uninsured motor vehicle because of bodily injury . . . caused by an accident arising out of such uninsured motor vehicle's ownership, maintenance or use" (emphasis added). The term "accident" is not defined in the policy and, thus, we must look to the definition provided by the Court of Appeals in State Farm Mut. Auto. Ins. Co. v Langan (16 NY3d 349, 353 [2011]). In State Farm, the Court held that, for purposes of an uninsured motorist endorsement, when an occurrence is — from the insured's perspective — "unexpected, unusual and unforeseen," it qualifies as an "accident" (id. at 355 [internal quotation marks and citation omitted]). As here relevant, the uninsured policy in State Farm contained identical language to Widdecombe's SUM policy. The Court further held that, although the insured was also the victim, "the intentional assault of an innocent insured is an accident within the meaning of his or her own policy" (id. at 356).  

Thus, whatever Germain's intent and criminal liability,[FN4] this incident was an accident from Widdecombe's perspective. Contrary to petitioner's contention, Widdecombe's uncontroverted testimony established that the incident "happened so fast" and, after he attempted to grab the keys, Germain said that "he was going to cut [Widdecombe's] leg off" and, as Widdecombe tried to get his leg out of the car, Germain "threw the car in drive" and "screeched" away, dragging Widdecombe. As in State Farm, this event "was clearly an accident from the insured's point of view," since having his leg trapped and being dragged was sudden and "unexpected, unusual and unforeseen" (State Farm Mut. Auto. Inc. Co. v Langan, 16 NY3d at 355-356; see Matter of Utica Mut. Ins. Co. v Burrous, 121 AD3d 910, 911 [2014]; Matter of Progressive Northeastern Ins. Co. v Vanderpool, 85 AD3d 926, 927 [2011]). Consequently, Supreme Court erred in granting the stay of arbitration and Widdecombe's claim should proceed to arbitration.

The prescribed New York UM/SUM endorsement does not contain an intentional acts exclusion.  Only the liability coverage section of personal auto policies does.