Lawsuit filed to deny Morgantown and insurance administrator subrogation claims
Dominion Post (Morgantown, WV)
Jun. 16—A lawsuit filed in Monongalia County Circuit Court aims to deny the City of Morgantown and Benefit Assistance Company, LLC any payment under a subrogation claim for a 2017 accident involving a party insured through the city. Benefit Assistance Company operates as the administrator for the city's health insurance.
Subrogation occurs when a person who doesn't owe the debt pays it, then is entitled to remedies offered by the creditor, or, essentially, to be paid back. A waiver of subrogation is signed by the insured to give up their rights to collect from a third party for reimbursement.
Through their counsel, D. Conrad Gall, plaintiffs Jeffery Orsborn and Sanda Orsborn, of Marion County, claim the city and the insurance company were non-responsive and ignored repeated requests on subrogation claims and assistance or requests to sign a waiver of subrogation.
Background information in the suit claims Jeffery Orsborn suffered severe injuries after being struck by a vehicle, driven by Patricia Vincent, while crossing State Route 310, just outside the Fairmont city limits in October 2017.
Orsborn was hospitalized for 55 days and remains permanently injured and walks with a cane. His medical bills totaled approximately $226, 000. He was insured through his wife, Sandra. Sandra received medical insurance through her work at the City of Morgantown Police Department, which covered Orsborn's medical bills. Sandra also had to take off work to care for her husband.
Because of significant liability issues with the accident recognized by both parties, the court divided the case, with liability to be tried separately from damages.
The Orsborns sued the Vincents in Marion County and settled for $70, 000 with the Vincents' insurance company, Westfield Insurance, in October 2021.
However, Westfield refused to pay the settlement without a waiver of subrogation from the City of Morgantown or Benefit Assistance Company, both of whom "failed to respond to requests on subrogation or even billing during the lawsuit, " the current suit claims. Without a waiver of subrogation, the City of Morgantown could sue to receive part of the settlement as reimbursement for paying Orsborn's medical bills.
According to the complaint, the Orsborns' attorney made repeated calls and sent written correspondence to the Benefit Assistance Company prior to the settlement requesting subrogation information without response. Despite being subpoenaed to appear before Judge Wilson in Marion County in December 2020, no one appeared on behalf of the company, according to the lawsuit.
The suit also claims that until the 2020 hearing, the plaintiffs were not aware that the City of Morgantown was self-insured, and they remain unaware of with whom the city reinsures. Since Morgantown is self-insured, it is backed, or reinsured, by a third party that can protect it against losses in a lawsuit.
"Plaintiff's counsel has sent at least three letters to the City of Morgantown asking to settle and get the identity of John Doe Reinsurer, " the lawsuit states. "The City of Morgantown has failed to identify whomever that reinsurer is."
The Vincents' attorney was able to call and speak with City of Morgantown attorney Ryan Simonton at a Dec. 23, 2021, hearing. Simonton advised that the City of Morgantown was owed $100, 000 and its reinsurer was owed approximately $126, 000.
The Orsborns' counsel claims to have also contacted Simonton on Dec. 23 to request a waiver of subrogation and received no response.
The Dominion Post reached out to the city for comment, but the city does not offer comment on ongoing litigation, according to Communications Director Andrew Stacy.
After attorney and court costs, the Orsborns were left with approximately $46, 000 of the $70, 000.
The Orsborns are asking the court for a declaratory judgment denying either of the defendants any payment under a subrogation claim or entitlement to any subrogation or payment from the Orsborns' settlement.
They also ask that Westfield Insurance Company be able to freely pay the Orsborns without concerns of subrogation from the City of Morgantown or Benefit Assistance Company.
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