Miglicio v. HCM Claim Management Corp.

Miglicio v. HCM Claim Management Corp.

Opinion

 [*335]  [**268]   WINKELSTEIN, J.S.C.

This matter comes before the court on a motion by defendant Hertz Claim Management Corporation (HCM) for summary judgment. The primary issue to be addressed, not heretofore decided in this jurisdiction, is whether HCM as the servicing carrier for the New Jersey Full Insurance Underwriting Association (the Association), is immunized pursuant to N.J.S.A. 17:30E-7b, & e, from claims of bad faith by its insured.

Plaintiff was injured when her vehicle was rear ended on June 16, 1990. She sustained disc injuries which required anterior  [*336]  fusion and a discectomy at C5-6 and C-6-7 on April 24, 1991. The negligent driver's insurance company offered its policy limits of $ 15,000 in settlement of the claim. On June 6, 1991, plaintiff requested permission from HCM, the servicing carrier for the Association [***2]  as plaintiff's underinsured motorist (UIM) carrier, to settle the claim with the negligent driver for the $ 15,000 policy limits. See Longworth v. Van Houten, 223 N.J. Super. 174, 538 A.2d 414 (App.Div.1988); Rutgers Cas. Ins. Co. v Vassas, 139 N.J. 163, 652 A.2d 162 (1995). Plaintiff's UIM policy [**269]  limits were $ 50,000. Defendant failed to respond to plaintiff's request.

On January 3, 1992, plaintiff filed a complaint against defendant demanding, inter alia, that she be permitted to accept payment of the $ 15,000 policy. After defendant was served, it consented to settle the third party claim for $ 15,000 but only under the condition that it receive a dismissal as to all counts in the complaint, which included claims for counsel fees, costs and punitive damages based on HCM's alleged acts of bad faith. On September 21, 1992 plaintiff wrote defendant naming an arbitrator and requested that defendant choose an arbitrator so the matter could be resolved through arbitration. Defendant failed to respond to plaintiff's request.

Thereafter, plaintiff's complaint was dismissed by the court for lack of prosecution. On motion to reinstate, the motion judge, by order of [***3]  December 4, 1992, reinstated the complaint and required defendant to file an answer. No answer was filed and default was entered. Subsequent thereto, at the request of counsel for HCM, plaintiff's counsel agreed to vacate the default. Medical records of plaintiff's injuries were then supplied to defendant's counsel. An effort to obtain the difference between the $ 15,000 received on behalf of the third-party tortfeasor and the $ 50,000 UIM policy limits was made but no agreement was reached.

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