AIU INSURANCE COMPANY v. ELRAC, INC

ORDERED that the order and judgment is affirmed, with costs.

In ELRAC, Inc. v. Ward ( 96 N.Y.2d 58, 78), the Court of Appeals held that "Vehicle and Traffic Law § 370 requires rental car companies to provide primary insurance to their renters up to the minimum liability limits provided by the statute", and as a result, "the indemnification clause in ELRAC's rental agreements, which seeks to disclaim that duty and assign the risk to the renters themselves, is unenforceable to that extent". The fact that ELRAC, Inc., d/b/a Enterprise Rent-A-Car Company (hereinafter ELRAC), is a self-insured company does not excuse it from providing minimum coverage (see, ELRAC, Inc. v. Ward, supra; Matter of Allstate Ins. Co. v. Shaw, 52 N.Y.2d 818). The indemnification clause is otherwise valid and thus enforceable for amounts exceeding the statutory minimum liability requirements (see, ELRAC, Inc. v. Ward, supra). In Morris v. Snappy Car Rental ( 84 N.Y.2d 21, 27), the Court of Appeals held that an indemnification agreement for damages above and beyond the statutorily-required insurance may be enforced, since Vehicle and Traffic Law § 388 was not "intended to go so far as to abrogate the right to indemnification" (Morris v. Snappy Car Rental, supra, at 28). Further, antisubrogation principles do not bar ELRAC from seeking indemnification for amounts exceeding the statutory limits (see, ELRAC, Inc. v. Ward, supra; North Star Reins. Corp. v. Continental Ins. Co., 82 N.Y.2d 281).

Nevertheless, ELRAC is entitled to full indemnification from the defendants because at the time of the accident, an unauthorized driver was operating the vehicle in violation of the rental agreement (see, ELRAC, Inc. v. Masara, 96 N.Y.2d 847).

BRACKEN, P.J., LUCIANO, FEUERSTEIN and ADAMS, JJ., concur.