Case Name: GIBBARD v. AUTO-OWNERS INSURANCE COMPANY
Court: Michigan Court of Appeals
Jurisdiction: Michigan
Decision Date: 1989-08-07
Citations: 179 Mich. App. 54
Docket Number: Docket No. 105505
Parties: GIBBARD v AUTO-OWNERS INSURANCE COMPANY
Judges: Before: Murphy, P.J., and Weaver and McDonald, JJ.
Reporter: Michigan appeals reports; cases decided in the Michigan Court of Appeals.
Volume: 179
Pages: 54–62

Head Matter:
GIBBARD v AUTO-OWNERS INSURANCE COMPANY
Docket No. 105505.
Submitted February 13, 1989, at Lansing.
Decided August 7, 1989.
Leave to appeal applied for.
Yvonne Lisa Gibbard sustained injuries, which required medical treatment, in an automobile accident at a time when she was covered by no-fault automobile insurance policies issued by Auto-Owners Insurance Company and Farm Bureau General Insurance Company of Michigan and by a group health insurance policy issued by The Guardian Life Insurance Company. The automobile insurers, whose policies contained no provisions for the coordination of benefits, paid Gibbard’s medical expenses. Gibbard filed a claim for benefits with the health insurer, which denied the claim on the basis of the coordination-of-benefits provision in its policy. Gibbard brought an action in Lapeer Circuit Court against all three insurers. Guardian Life filed a motion for summary disposition. The trial court, Norman A. Baguley, J., granted the motion, ruling that there existed no genuine issue of material fact and Guardian Life was entitled to judgment as a matter of law. Plaintiff appealed.
The Court of Appeals held:
The elimination of duplicative recovery and the containment or reduction of insurance costs, determined by the Supreme Court in Federal Kemper Ins Co, Inc v Health Ins Administration, Inc, 424 Mich 537 (1986), to be the Legislature’s objectives in allowing no-fault insurers to provide for coordinated benefits in exchange for reduced premiums, is best achieved in this case by giving effect to the coordination-of-benefits provision in Guardian Life’s group health insurance policy.
Affirmed.
Murphy, P.J., dissented, opining that the majority’s holding totally vitiates the legislatively mandated options provided to insureds under the provisions of the no-fault act relating to coordination of benefits since the insured in this case received nothing in return for the higher premiums paid to the no-fault _insurers. Judge Murphy would hold that, in the absence of any evidence indicating that the group health insurer reduced its premiums in exchange for the coordination of benefits under its policy, summary disposition was improper.
References
Am Jur 2d, Automobile Insurance § 359.
See the Index to Annotations under No-Fault Insurance.
Insurance — No-Fault — Personal Protection Insurance — Coordination of Benefits.
Expenses incurred for the medical treatment of a person injured in an automobile accident while insured under a no-fault automobile policy which does not provide for coordination of personal protection insurance benefits with other health and accident coverage and insured under a group health insurance policy which provides for coordination of benefits with other insurance are payable by the no-fault automobile insurer only (MCL 500.3109a; MSA 24.13109[1]).
Taylor, Carter, Butterñeld, Riseman, Clark & Howell, P.C. (by Carl M. Riseman), for plaintiff.
Seavitt, Westcott & Stowe (by Michael J. Yockey), for The Guardian Life Insurance Company.
Before: Murphy, P.J., and Weaver and McDonald, JJ.

Opinion:
McDonald, J.
Plaintiff appeals as of right from an order granting summary disposition in favor of defendant The Guardian Life Insurance Company pursuant to MCR 2.116(0(10), no genuine issue of material fact. We affirm.
On December 27, 1985, plaintiff was injured when the automobile in which she was a passenger was involved in an accident. Plaintiff's medical expenses were reimbursed by her parents' no-fault noncoordinated benefits insurance policies provided by defendants Auto-Owners Insurance Company and Farm Bureau General Insurance Company of Michigan.
At the time of the accident plaintiff was covered through her employer by a group health insurance policy issued by defendant Guardian Life. Plaintiff also applied to Guardian Life for reimbursement of medical expenses under this group policy. Guardian Life rejected plaintiffs claim arguing the group policy's coordination-of-benefits clause barred plaintiffs claim.
Following Guardian Life's rejection of plaintiffs claim, plaintiff filed the instant action for benefits under the group policy. Thereafter, Guardian Life filed a motion for summary disposition pursuant to MCR 2.116(0(10) claiming no genuine issue of material fact existed as plaintiff was primarily covered under another insurance policy which already reimbursed plaintiff for her medical costs. The trial court found defendant Guardian secondarily liable to the no-fault policies and granted defendant's motion for summary disposition.
On appeal plaintiff claims the trial court erred in failing to find Guardian Life liable for loss despite the policy's inclusion of a coordination clause. Plaintiff argues that giving effect to the health insurer's coordination clause contravenes § 3109a of the no-fault insurance act which provides;
An insurer providing personal protection insurance benefits shall offer, at appropriately reduced premium rates, deductibles and exclusions reason¿bly related to other health and accident coverage on the insured. The deductibles and exclusions required to be offered by this section shall be subject to prior approval by the commissioner and shall apply only to benefits payable to the person named in the policy, the spouse of the insured and any relative of either domiciled in the same household. [MCL 500.3109a; MSA 24.13109(1)]
Plaintiff relies on our Supreme Court's decision in Federal Kemper Ins Co, Inc v Health Ins Administration, Inc, 424 Mich 537; 383 NW2d 590 (1986), to support this claim.
In Federal Kemper, the Court found that this provision (§ 3109a), and the legislative intent behind it, preclude giving effect to a coordination clause in health insurance when the insured's no-fault medical benefits are coordinated. The Court found § 3109a to have dual purposes: the elimination of duplicative recovery and the containment or reduction of insurance costs.
To effectuate these purposes, the Court in Federal Kemper chose to give a no-fault coordination clause priority over a similar clause in the insured's health insurance policy. However, the Court expressly limited its decision to situations where an insured has opted for coordinated no-fault benefits. Such is not the situation in the instant case. Here, the insured has noncoordinated no-fault insurance and coordinated health insurance. Nonetheless, plaintiff contends the legislative goal of providing persons insured under no-fault the ability to reduce their premiums by obtaining less coverage via coordination prohibits a health insurer from making its insurance secondary to noncoordinated no-fault benefits. We disagree.
Although we agree to some degree that allowing coordination in circumstances similar to those presented here would limit a no-fault insured's choice under § 3109a, we believe the major purposes of the statute are advanced by the trial court's treatment of the issue. Presumably, plaintiff's employer pays smaller premiums, thus keeping the cost of insurance contained, and duplicative recovery is eliminated.
Additionally, a recent decision of this Court upholds a lower court's grant of summary disposition under circumstances similar to those presented here. In Estabrook v Lincoln National Life Ins Co, 172 Mich App 450; 432 NW2d 733 (1988), a plaintiff who had noncoordinated no-fault insur anee and coordinated group disability insurance was injured in a motorcycle accident. The trial court granted summary disposition to plaintiffs disability insurer finding its coordination provision effective. In so holding, the court relied on MCL 550.3610a; MSA 24.13610(1), which specifically authorizes a group disability insurance policy to provide for the coordination of benefits with benefits payable for the same loss under automotive medical payments insurance. Thus, plaintiffs assertion that the Legislature intended no infringement on an insured's choice of coordinated or uncoordinated no-fault insurance must be rejected.
Affirmed.
Weaver, J., concurred.