Maine Insurance Guaranty Ass'n v. Folsom, 2001 ME 63

Summary

The Supreme Judicial Court of Maine held that Maine Insurance Guaranty Association was not liable to solvent workers' compensation insurers for apportionment of benefits attributable to an insolvent insurer. The court concluded that such apportionment claims constituted subrogation or otherwise fell outside the statutory definition of covered claims, making MIGA a guarantor of last resort. The judgment for MIGA was affirmed.

Holdings

1. A workers' compensation insurer's claim for apportionment against MIGA is in the nature of subrogation and is therefore excluded from the definition of a covered claim under 24-A M.R.S.A. § 4435(4). MIGA is not liable for an insurer's apportioned share unless and until the employee has exhausted rights and benefits available from solvent insurers.
2. The insurer providing coverage at the time of the employee's last injury is solely responsible for both past and future benefits until it obtains an apportionment against other responsible insurers.
3. Excluding MIGA from apportionment does not reduce or delay the employee's benefits. In this case, the law applicable to the 1992 injury governs the amount of benefits, and the most recent insurer remains responsible for paying the benefits awarded until any apportionment is obtained.

Questions Presented

1. Whether an insurer's claim for apportionment against MIGA is a subrogation claim or otherwise excluded from the definition of a covered claim under the Maine Insurance Guaranty Association Act.
2. Whether the insurer covering the employee's most recent injury is responsible for both past and future benefits until it obtains an apportionment against other responsible solvent insurers.
3. Whether excluding MIGA from apportionment deprives the employee of benefits or requires application of the law in effect at the time of an earlier injury.

Disposition

affirmed