No Cooperation = No Insurance Coverage in DWI Crash – Hager v. Gonsalves

In Friday’s Appellate Division decision in Hager v. Gonsalves, the Court ruled that the failure of both an insured person and the driver of his vehicle to cooperate with the insurance company that is responsible for providing coverage on the vehicle will permit the company to deny coverage.

In this case, a vehicle owned by the defendant was operated by another person. The driver operated the vehicle while intoxicated and had an accident resulting in significant personal injury and property damage to an innocent third person. Despite the best efforts of the insurance company, neither the owner nor the intoxicated driver would cooperate in any way with the defense of the claim by the injured party.

The Court ruled that people seeking coverage under a policy of automobile insurance have an affirmative duty to cooperate with the insurance company in the defense of any claim made under the policy. When the failure to cooperate results in an “appreciable prejudice” to the insurance carrier, coverage under the policy can be lawfully denied. In the case before the court, the failure to cooperate by both the owner and the intoxicated driver made it impossible for the insurance carrier to determine whether or not the operator was a permissive user of the vehicle. Such evidence might have resulted in a defense to the payment of a claim by the company. Accordingly, the failure to cooperate resulted in an “appreciable prejudice” to the carrier and coverage could be lawfully denied.

Download a copy of Hager v. Gonsalves.

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