Section 6.39 Reimbursement for Payments From Other Sources

• Library: Insurance Practice 2015

Policies commonly have a clause pertaining to reduction of payments based on compensation received by the insured under workers’ compensation or disability benefits laws.

When a police officer obtained a $100,000 judgment against an underinsured motorist, whose liability insurer paid policy limits of $25,000, the officer then sought the balance from his UIM insurer. Because the officer was being paid disability retirement, the UIM insurer sought an off-set based on a policy provision that allowed a...