Progressive's frivolous denial of PIP benefits to motorcylist is rejected
Jeremy Bogue was riding his motorcycle when he was struck and badly hurt by a HomeOwners' insured operating a van. Bogue sought PIP benefits, but Progressive denied them, arguing that his motorcycle was an "ORV" and therefore he wasn't eligible for coverage. Under the law, Progressive's denial required HomeOwners to step into the breach and it paid Bogue's medical and wage loss expenses, as required by the no fault law, totalling $184,000.00. HomeOwners then sued Progressive for reimbursement.
The trial court agreed with HomeOwners' argument that under MCL 500.3114, the priority provision of the no fault act, Progressive, as the insurer of the only involved "motor vehicle," was obligated to pay Bogue's PIP benefits. Progressive appealed, arguing that since Bogue was operating an ORV, the explicit language of 3114 did not apply to require it to pay PIP benefits. The Court of Appeals rejected this argument and allowed the plaintiff to tax costs. It noted that the motorcycle fit the definition of "motorcycle" under the no fault act, and also met the definition of an ORV. These definitions were not inconsistent under the circumstances and they rendered Progressive the insurer obligated to pay PIP benefits. Further, the 2008 amendment to the no fault act excluding ORVs from the definition of "motorcycles" did not alter this conclusion.