Michigan Court of Appeals; Docket No. 86355; Published
Judges Danhof, Hood, and Sullivan; Unanimous; Per Curiam
Official Michigan Reporter Citation: 152 Mich App 734; Link to Opinion 
STATUTORY INDEXING:
General Rule of Priority [§3114(1)]
TOPICAL INDEXING:
Not Applicable
CASE SUMMARY:
In this unanimous per curiam Opinion, the Court of Appeals addressed a priority dispute arising out of plaintiff’s claim that prior transfer of ownership in the motor vehicle named in a no-fault insurance policy automatically terminated the personal protection insurance coverages of the policy.
Plaintiff’s decedent was killed in an accident which occurred on March 7,1983, when decedent, a pedestrian, was struck by an automobile driven by the person insured by defendant, League General. The accident occurred during the term of an insurance policy that had been purchased by decedent from Automobile Club (AAA) prior to the accident. During the term of the policy, the vehicle insured under the policy had been transferred and sold. However, the decedent had not canceled the AAA insurance policy prior to the accident. After the accident, an effort was made to cancel the policy by plaintiff, retroactive to the date that the ownership of the insured vehicle was transferred.
In affirming the decision of the trial court, the Court of Appeals held that because plaintiff’s decedent had a policy of insurance in effect at the time of his injury and death, AAA is the proper priority insurer from whom plaintiff can claim benefits pursuant to §3114(1).
The Court of Appeals adopted the argument of defendant League General that, the personal protection benefits of the AAA policy were still effective on the date of the accident, since there had been no cancellation up to that time, and therefore, AAA was the proper party from whom plaintiff should seek personal protection insurance benefits. The Court rejected plaintiff’s argument that since plaintiff’s decedent did not have an automobile on the date of the accident, he could not have no-fault automobile insurance as a matter of law because he had no "insurable interest in an automobile."
In reliance upon Lee v DAIIE (Item No. 489), the Court of Appeals emphasized that it is not required that a vehicle intended to be covered under the No-Fault Act be involved in an accident for the insurer to be liable. As an extension of this rule, the Court of Appeals in this case held that a person's interest in his own health and well-being is the insurable interest which entitles that person to personal protection benefits, regardless of whether a covered vehicle is involved. There is no requirement that an insured motor vehicle be involved for these benefits to be payable to the injured insured person. The overriding purpose of the No-Fault Act is to provide protection for persons, not automobiles.
The Court held that the post-accident effort to retroactively cancel the insurance policy was ineffective. Rights created under an insurance policy become fixed as of the date of the accident.
