Royal Globe Insurance v. Rzhevsky

OPINION OF THE COURT

Ira B. Harkavy, J.

May an insured who alleges receipt of inadequate compensation from its insurer accept payment from the insurer and simultaneously pursue the tort-feasor for the claimed balance? In a recent decision, in this court, it was held that an implied covenant of good faith supersedes the contractual rights of exclusive subrogation (Faraino v Centennial Ins. Co., 117 Misc 2d 297). In this case, we must decide the recourses available to an insured who alleges lack of good faith on the part of its insurer in the settlement of the claim.

Royal Globe Insurance Company…