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Michigan Allows Fraudster to Receive PIP Benefits but no UM/UIM Benefits  

Plaintiff appealed the trial court\\u2019s order granting summary disposition  in favor of defendants Home-Owners Insurance Company (\\u201cHome-Owners\\u201d),  American Country Insurance Company (ACIC), and Hartford Accident and  Indemnity Company (\\u201cHartford\\u201d), with respect to plaintiff\\u2019s claims for  uninsured or underinsured motorist benefits and first-party personal  protection insurance (PIP) benefits under the no-fault act, MCL 500.3101  et seq. Although defendants disputed their priority to pay PIP  benefits, the trial court did not decide the priority issue, but instead  dismissed all claims on the basis of antifraud provisions in  defendants\\u2019 respective policies. 

In Jonathan Jones v. Home-Owners Insurance Company, American Country  Insurance Company, And Hartford Accident & Indemnity Company, and  Sharneta Henderson, No. 355118, Court of Appeals of Michigan (August 18,  2022) the Court of Appeal produced a Solomon-like decision. BASIC FACTS This case arises from a motor vehicle accident on October 28, 2017, in  which plaintiff\\u2019s vehicle was struck by a vehicle driven by defendant  Sharneta Henderson in Detroit. Plaintiff alleges that he was operating a  2009 Ford Crown Victoria and was stopped at a red light when  Henderson\\u2019s vehicle, traveling at a high rate of speed, drove through a  red light and struck his vehicle.

 Plaintiff sued all three insurers for recovery of no-fault PIP benefits  and also uninsured or underinsured motorist benefits. All three insurers  filed motions for summary disposition, asserting that plaintiff\\u2019s  claims were barred by antifraud provisions in the respective policies.  

SUMMARY DISPOSITION PRIORITY UNDER MCL 500.3114  

Initially, the Court of Appeal concluded that the trial court erred by  failing to address which insurer had priority to pay PIP benefits under  MCL 500.3114. The general rule is that one looks to a person\\u2019s own insurer for  no-fault benefits unless one of the statutory exceptions applies. An  individual may be entitled to PIP benefits mandated by the no-fault act  even if the person is not a named insured \\u201cunder a no-fault policy, and  such a person is not subject to the policy\\u2019s antifraud provision.\\u201d  Because the plaintiff\\u2019s entitlement to no-fault benefits was governed by  statute, the exclusionary provision in the defendant\\u2019s no-fault policy  did not apply and could not operate to bar the plaintiff\\u2019s claims.  

POST-PROCUREMENT FRAUD