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Two Insurance Policies are the Subject of Court Discussion


The Queens defendant is appealing an order that declared they had the obligation to defend and indemnify the plaintiff in an action against him by the administratrix of the estate of the deceased. The order that is being appealed denied the cross motion for summary judgment and declared that the insurance policies in question were in full force and effect and invoked the duty of the defendant to defend.

Case Background

The plaintiff applied to the defendant insurance association for professional liability insurance coverage in January of 1981. The insurance association made an error that resulted in the policy not being issued until June of 1982. There were two policies issued at this time. The first policy was in effect from February of 1981 through February of 1982 and is referred to as the 1981 policy. The second policy was in effect from February 1982 through February 1983 and is referred to as the 1982 policy.

In October of 1982 the doctor requested that the 1981 policy be cancelled and that the down payment for that particular policy be applied to the 1982 policy. It was during the span covered in the 1981 policy that the doctor was sued for malpractice.

Court Discussion

The question before the Staten Island court is whether the retroactive rescission of the 1981 policy that was done with the consent of the insurance company precluded coverage for the malpractice claim brought after the rescission, but relating to a time that the policy was in effect.

The Supreme Court decision stated that the insurance company must defend the doctor in the malpractice suit and allowed the counterclaim by the company against the doctor for unpaid premiums open for future resolution.

Court Decision

The court has reviewed the case and has determined that the insurance company is obligated to defend the doctor in the malpractice suit. The issue of whether any type of malpractice that was committed by the doctor falls into the policy exclusions must be determined after the action is completed. Based on the information that the court has been confronted with the judgment is affirmed as appealed from.

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