In Psych. & Massage Therapy Assoc., PLLC v. Progressive Casualty Ins. Co., 5 Misc 3d 723, 789 N.Y.S.2d 661 (Civ Ct, Queens Co., 2004), Judge Agate determined that neither case law nor statutory language required the insurer to wait thirty days before it could submit a follow-up request or be precluded from offering any defenses at trial. Id at 724.
Interpreting the predecessor to Regulation 11 NYCRR § 65-3.6 (b), the court stated that "(w)hile the regulations require an insurer to submit a follow-up request within 30 days from the date of submission of the request, it does not mandate that the insurer wait 30 days before sending a follow up request. Instead, this time frame is a limit to the amount of time an insurer may wait before sending a follow up request." Id at 724-25.
The court then found that:
penalizing defendant for sending a follow-up request 25 days after its initial request is inconsistent with the goals of the No-Fault Law. The purpose of the No-Fault Law is to allow swift compensation for qualified injured persons from the insurance companies. . The regulations require insurers to act quickly in evaluating insured claims and to avoid prejudicial delays . The verification requirement exists in order for insurers to have their opportunity to promptly investigate and respond to legitimate claims, not to delay payment .(Psych. & Massage Therapy Assoc., PLLC, supra, p.725.)
The court further noted that plaintiff's attempt to penalize defendant for being too prompt would be totally inconsistent with defendant's duties under the No-Fault Law to promptly respond to the insured's claims. Id at 726.
Defendant would suffer undue prejudice if a verification request was found improper as it would have to pay for a claim for which it complied with the regulations.
Moreover, defendant's early follow-up verification request did not prejudice plaintiff in any manner, as plaintiff was not under any time restraint to respond to defendant's verification. Id.
On appeal, the Appellate Term stated, without any elaboration, that: "despite defendant's untimely denial of plaintiff's claim for the sum of $ 1,360.48, defendant was not precluded from asserting the defense of lack of coverage" Psych. & Massage Therapy Assoc., PLLC v. Progressive Cas. Ins. Co., 2006 NY Slip Op 51351[U], 12 Misc 3d 140[A], 824 N.Y.S.2d 766 [App. Term, 2d Dept. 2006].