B. Subrogation of claims for payments under the mandatory benefits section of automobile accident reparations statutes.

C. Where allowed by state law, the subrogation of medical payments claims.

D. If the parties agree, the subrogation of excess or voluntary benefits under any automobile accident reparations statute.

E. If the parties and the committee agree, questions of policy coverage involving the rights of only the two insurers involved in the arbitration.

F. Third party contribution claims.

Jurisdiction of the Committee

The NAMIC arbitration committee has automatic jurisdiction in disputes between members involving damage to or by motor vehicles or livestock. In addition to individual insurers being required to sign the agreement, the corporate parent must also sign, if it wishes to participate in arbitration. The arbitration process is also open to certain non-signatories.

Non-signatory petitioners and respondents may become eligible for arbitration if they agree to be bound by the committee's decision. Where allowed by state law, a non-signatory third party defendant may be impleaded into the process.

When the respondent party has issued a policy with a property damage deductible, the insured becomes a partial self insurer for the amount of that deductible. In such a case, the claim arbitration committee may not take jurisdiction in a dispute without the consent of the policy holder. The only exceptions are when arbitration is mandatory under state law or where the petitioner waives its right of judicial action against the respondent.

Individual insureds may request arbitration when a signatory company files a counterclaim against that individual. The individual's insurer must be a signatory to the arbitration agreement. NAMIC considered the pros and cons of allowing insureds to become parties to arbitration and decided that to refuse to allow it “might tend to encourage chicanery among companies in delaying or promoting civil actions by their policyholders.” The conference concluded that such delay or promotion is not “consistent with the intent and spirit of the claim arbitration agreement,” whose purpose is to “reduce litigation among the members.”

Two other matters may be arbitrated, when all parties are signatory to the agreement: policy coverage and losses involving company owned vehicles.

Claims, Damages, and Bailment

When a petitioner submits a request for an arbitration hearing, the following materials should be included:

A. Original and one copy of the petition/response form. This form gives the basic information about insurers involved, description of the accident, and other supporting evidence such as photographs.

B. Filing fee of $80.

C. Evidence of payment of each claim. In cases with multiple payments and/or if salvage was included, a complete breakdown of calculations used to arrive at the net claim is required.

D. A copy of the claim denial letter from the respondent insurer. However, if the respondent fails to reply to the petitioner's second subrogation demand within sixty days, jurisdiction may be granted to the arbitration committee through “constructive denial.” A respondent's denial is not required in cases of medical payment only claims.

E. If the respondent is not a signatory to the arbitration agreement, waiver of non-jurisdiction is required.

If the respondent insurer wishes to enter a counterclaim arising out of the same incident, the counterclaim must accompany the answer to the petition. If the counterclaim is not presented at this time, the respondent insurer waives its right to bring such a claim. After the filing of a counterclaim, the petitioner is entitled to file a response. If the respondent makes a counterclaim, the petitioner will be given an opportunity to provide a response by the date set by the arbitration administrator.

In order to determine the amount of damages, the petitioner must include evidence of payment for medical pay, material damages, and benefits paid under an automobile reparations act. Only one filing is necessary to establish liability and any claims not presented at this time are waived. If, for some reason, the amount of damages cannot be determined at the time of the initial filing, the committee will decide the issue of liability and establish a date for a future hearing on damages.

Issues of bailment may arise when an insured loans the covered vehicle to a friend, who then has an accident. In addition to the items described above as required in an arbitration file, a bailment situation requires written or tape-recorded statements from both the owner of the car and the operator. These statements must cover:

A. Ownership of the vehicle.

B. Permission to use the vehicle.

C. Purpose of the trip.

If the accident occurs in a state where contribution by joint tortfeasors is allowed, the committee may find joint negligence on the part of the respondent and the bailee, allowing an award based on the law of that state. The burden of proof is on the party asserting the contribution claim. If the state uses comparative negligence, the committee may award the petitioner an amount based on the percentage of negligence. If sufficient proof is not present, the committee may award 50 percent of the physical damage amount. If the accident occurs in a state where contribution on the basis of comparative negligence is allowed, the committee's award may be based on such comparative or percentage of negligence.

Arbitration of a case may be deferred until all companion claims or suits not subject to arbitration, involving the same damages issue, have been disposed of by settlement or other means.

Conclusion

The NAMIC claim arbitration committee exercises automatic nationwide jurisdiction over disputes involving motor vehicles and livestock. The committee always renders a written decision, including a discussion of the reasoning that went into the final ruling. Thus, the answer given is more complete than just a summation of who wins and who loses. In addition, there is a limited provision for appeal, if it is determined that a concept of law was misapplied in reaching a decision.