New York Codes, Rules and Regulations › Title 11 - INSURANCE › Chapter III - Policy and Certificate Provisions › Subchapter B - Property and Casualty Insurance › Part 65 - Regulations Implementing The Comprehensive Motor Vehicle Insurance Reparations Act › Subpart 65-4 - Arbitration › Section 65-4.6 - Limitations on attorney's fees pursuant to section 5106 of the Insurance Law

Current through Register Vol. 46, No. 28, July 10, 2024
The following limitations shall apply to the payment by
						insurers of applicants' attorney's fees for services necessarily performed in
						the resolution of nofault disputes:
(a) If an arbitration was initiated or a
					 court action was commenced by an attorney on behalf of an applicant and the
					 claim or portion thereof was not denied or overdue at the time the arbitration
					 proceeding was initiated or the action was commenced, no attorney's fees shall
					 be granted.
(b) If the claim is
					 resolved by the designated organization at any time prior to transmittal to an
					 arbitrator and it was initially denied by the insurer or overdue, the payment
					 of the applicant's attorney's fee by the insurer shall be limited to 20 percent
					 of the total amount of first-party benefits and any additional first-party
					 benefits, plus interest thereon, for each applicant with whom the respective
					 parties have agreed and resolved disputes, subject to a maximum fee of $1,360.
(c) For disputes subject to
					 arbitration or court proceedings, where one of the issues involves a policy is-
					 sue as enumerated on the prescribed denial of claim form (NYS form NF- 10),
					 subject to this section, the attorney's fee for the arbitration or litigation
					 of all issues shall be limited to a fee of up to $70 per hour, subject to a
					 maximum fee of $1,400. In addition, an attorney shall be entitled to receive a
					 fee of up to $80 per hour for each personal appearance before the arbitration
					 forum or court.
(d) For all other
					 disputes subject to arbitration or court proceedings, subject to the
					 provisions of subdivision (a) of this section, the attorney's fee shall be
					 limited as follows: 20 percent of the total amount of first-party benefits and
					 any additional first-party benefits, plus interest thereon, for each applicant
					 per arbitration or court proceeding, subject to a maximum fee of $1,360 . If
					 the nature of the dispute results in an attorney's fee that could be computed
					 in accordance with the limitations prescribed in both subdivision (c) and this
					 subdivision, the higher attorney's fee shall be payable.
(e) Notwithstanding the limitations specified
					 in this section, if the arbitrator or a court determines that the issues in
					 dispute were of such a novel or unique nature as to require extraordinary
					 skills or services, the arbitrator or court may award an attorney's fee in
					 excess of the limitations set forth in this section. An excess fee award shall
					 detail the specific novel or unique nature of the dispute that justifies the
					 award. An excess award of an attorney's fee by an arbitrator shall be
					 appealable to a master arbitrator.
(f) If a dispute involving an overdue or
					 denied claim is resolved by the parties after it has been forwarded to the
					 conciliation center of the appropriate arbitration forum or after a court
					 action has been commenced, the attorney for the applicant shall be entitled to
					 a fee, which shall be computed in accordance with the limitations set forth in
					 this section.
(g) No attorney shall
					 demand, request or receive from the insurer any payment of fees not permitted
					 by this section.1
(h) Notwithstanding any other provision of
					 this section and with respect to billings on and after the effective date of
					 this regulation, if the charges by a health care provider, who is an applicant
					 for benefits, exceed the limitations contained in the schedules established
					 pursuant to section 5108  of the Insurance Law, no attorney's
					 fee shall be payable by the insurer. This provision shall not be applicable to
					 charges that involve interpretation of such schedules or inadvertent
					 miscalculation or error.
1 Attorneys should be aware of
						the Appellate Division Rules prohibiting fees in connection with the collection
						of first-party no-fault benefits (22 NYCRR sections 603.7(e)(7), 691.20(e)(7),
						806.13(f) and 1022.31(f)).