Appellate Commission Resolves Insurance Benefits Coverage Dispute Between Auto Insurers and Self-Insured Employer

In Salenbien, et al. v. Arrown Uniform Rental Ltd., Self Insured, the Michigan Compensation Appellate Commission applies two important principles in this dispute between an auto insurer and the self-insured employer in a claim concerning which of the two is responsible for medical and wage-loss benefits owed to an employee injured in an automobile accident while on his way back from an end-of-day client call.

The facts are not remarkable.  The employee was involved in an auto accident after making a sales call.  It was the end of the day and it was not clear whether the employee was returning to the office.  In any event, the magistrate ruled the injury arose out of an in the course of his employment.

The Appellate Commission reverses.  It establishes (or clarifies) two important principles under the workers’ compensation statute.  First, the Commission clarifies that a workers’ compensation claimant bears the burden of proving that an injury both “arose out of” and “in the course of” employment.  Both section 301 and 315 of the act require proof that both of these elements be established by the claimant seeking benefits from his or her employer.

The second aspect of this case that it is important is that the Commission has ruled that the auto insurer, rather than the workers compensation insurer (here the self-insured employer) is responsible first and foremost for injuries incurred in an automobile accident.  Auto insurers are allowed to seek indemnity coverage for medical expenses and other benefits paid to one injured in an accident arising out of the operation, ownership, maintenance, or use of a motor vehicle as a motor vehicle under Michigan’s No-Fault Automobile Insurance Liability Act (the No-Fault Act).  See mcl 500.3109.  But to do so, the auto insurer bears the same burden of proof as the employee seeking workers’ compensation benefits.  In other words, the auto insurer steps into the shoes of the employee and must prove that an injury incurred in an auto accident both arose out of and in the course of employment.  Otherwise, the auto insurer remains primarily and solely responsible for benefits payable to the injured claimant.

This is an important case in the complex tapestry of law under two “no-fault” insurance systems:  auto insurance and workers’ compensation insurance.  Any insurance coverage question must include consideration of the jurisdiction’s laws and appellate decisions assigning primary coverage responsibilities to one insurer over another.

About cjtucker06

Owner of law firm since July 2014; Handles all types of appellate matters and assists other lawyers with complex litigation and insurance coverage issues; Admitted to the Supreme Court of the United States, the Sixth Circuit Court of Appeals and the State Bar of Michigan; Expertise in prosecuting and defending appeals with several significant successes in the Sixth Circuit Court of Appeals, the Michigan Supreme Court and the Michigan Court of Appeals; Author of briefs amicus curiae in the Michigan Supreme Court for the Michigan Defense Trial Counsel and the Insurance Institute of Michigan; Represents Insurance Companies, Major International Business, Governmental Entities, Law Enforcement Officers and County Sheriffs. Board of Directors, Michigan Defense Trial Counsel Amicus Committee Co-Chair, Michigan Defense Trial Counsel Military - Retired Major in the Judge Advocate General (JAG) Corps of the United States Army, Brigade Judge Advocate and Staff JAG officer for the Maneuver Training Center, Camp Grayling, Michigan; Recipient of the Army's Meritorious Service Medal (the highest medal of honor available to Soldiers serving in non-combat roles); 2012 Graduate of the Judge Advocate Officer Advanced Course, at The Judge Advocate Legal Center and School, Charlottesville, Virginia. United States Navy Reserves, Combat Warfare Qualification, January 1989 to July 2003 Former law clerk to Justice Stephen J. Markman, Michigan Supreme Court, Research Attorney, Michigan Court of Appeals. Insurance Coverage Associate Plunkett Cooney; Environmental Law Attorney at Squire Sanders, now Squire Patton Boggs; Master's Degree in Environmental Law; Environmental Law Scholar, ALI/ABA Washington, D.C., Juris Doctorate, Vermont Law School, Environmental Editor, Vermont Law Review; Treasurer and Finalist, Moot Court Advisory Board.
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