Everest Re Not Obligated to Pay Insureds Subrogation Proceeds, N.Y. State Judge Rules

NEW YORK — Everest Reinsurance Co. is not obligated to pay policyholders proceeds derived from its subrogation action against a “deep-pocketed” third-party tortfeasor, a New York state judge has ruled, noting the policyholders already recovered the full value of their policy, minus uninsured losses.

On Nov. 7, Judge Shirley W. Kornreich of the New York County Supreme Court noted the New York Court of Appeals has rejected the “made whole” doctrine advanced by the insureds.

In April 2008, Nusyn and Chaya Erlich bought a water cooler made by Greenway Home Products Inc., and installed it in the basement of their …