Michigan Court of Appeals; Docket No. 103394; Published
Judges Holbrook, Jr., Murphy, and Grathwohl; Unanimous; Per Curiam
Official Michigan Reporter Citation: 176 Mich App 138; Link to Opinion 
STATUTORY INDEXING:
Coordination with Other Health and Accident Medical Insurance [§3109a]
General Rule of Priority [§3114(1)]
Equal Priority Situations [§3114(6)]
Recoupment Between Equal Priority Insurers [§3115(2)]
TOPICAL INDEXING:
Not Applicable
CASE SUMMARY:
In this published per curiam Opinion, the Court of Appeals unanimously affirmed the decision of the trial court holding that two no-fault insurers of equal priority share the liability for excess medical expenses on an equal basis, regardless of the number of vehicles or insured persons in the household.
In this case, defendant Clark Clouse was involved in a motor vehicle accident while a passenger in a vehicle driven by another. Clouse was not a named insured under his own or a relative's no-fault insurance policy, even though he resided with his parents and a sister.
Citizens Insurance was the insurer of four vehicles owned by Clouse's parents. Transamerica Insurance was the insurer of one vehicle owned by Clouse's mother, and of a vehicle owned by Clouse's sister. Clouse also had an individual major medical expense policy with American Community. Both Citizens and Transamerica's respective no-fault policies contained coordinated coverage, and American Community had a conflicting "deductible clause" which, in effect, was a coordination of benefits provision.
The trial court held that American Community, as Clark Clouse's health insurer, was the primary company from whom he must seek his medical expenses. The court further held that liability for excess medical expenses was to be shared equally along with all other no-fault liability between Citizens and Transamerica.
On appeal, the Court of Appeals affirmed the decision of the trial court, holding that the Supreme Court decision in Federal Kemper v Health Insurance Administration, 424 Mich 537 (1986) had determined that a health insurer was primarily liable for medical coverage for a motor vehicle accident where its coordinated benefits clause conflicted with that under the no-fault insurance policy applicable. Although Federal Kemper, supra, involved a group health insurance policy, the rule was determined in this case to be equally applicable to individual insurance policies.
As between the two no-fault insurance carriers, the Court of Appeals affirmed the trial court's decision that they must equally share the excess liability. Transamerica's argument that the priority between the two no-fault insurers should be determined based on the number of vehicles insured and "consequently upon the amount of premium received for each insurer for the particular risk" was rejected by the court. In its opinion, the court held that priority between two otherwise equal in priority no-fault insurers is not to be determined based on the "nature of the risk taken on by the insurer." The court held that "equitable distribution of the loss among the insurers is best achieved by reference to the number of insurers." This result is consistent with the Legislature's intent that persons and not vehicles be insured against loss. The court further held that language in §3115(2) referring to entitlement to partial recoupment from other insurers in the same order of priority in order to "accomplish equal distribution of the loss among such insurers" did not support Transamerica's argument on appeal. Therefore, the decision of the trial court was affirmed.
