In a set of three new decisions, the Appellate Division, Second Department, has changed a major factor in no-fault litigation by holding, for the first time, that an insurers denial of benefits (form NF-10) that is based on the findings of a peer review report, need not cite the medical rationale of the peer review in the denial. These three decisions overrule the prevailing case law, which has held that denials are not valid if they do not recite the medical rationale stated by the peer reviewer.

The three decisions are:

A.B. Med. Servs., PLLC v Liberty Mut. Ins. Co., 2007 NY Slip Op 03636;

New York Univ. Hosp. Rusk Inst. v Government Employees Ins. Co. 2007 NY Slip Op 03671;

A.B. Med. Servs., PLLC v Liberty Mut. Ins. Co., 2007 NY Slip Op 03636.

In these rulings, the Second Department held that, To the extent the Appellate Terms order may be understood to require an insurer denying a claim for first-party no-fault benefits on the ground of lack of medical justification to include a medical rationale in its denial of claim form, we agree with the defendant that the court erred. The applicable regulations provide that if a no-fault claim is denied in whole or in part based on a medical examination or peer review report requested by the insurer, then the insurer shall release a copy of that report to, among others, the applicant or its attorney, upon written request (see 11 NYCRR 65-3.8[b][4]).

Comment: The three rulings are virtually identical except for the individual facts and names, and each decision refers to the other two as decided herewith.

The Appellate Division has, therefore, removed one of the most vexing and irrational burdens on insurers that has come out of the lower courts.

Is this ruling retroactive? I would say yes. There is no indication in the rulings that this is new law; rather, it appears to be an interpretation of the regulations that corrects the heretofore incorrect interpretations by the lower courts.

As a result of these rulings, many extant cases that were considered indefensible can now be defended. And some cases that were recently lost due to the old interpretation may now be reargued upon motion.