— Order, Supreme Court, New York County (Edward H. Lehner, J.), entered on or about September 7, 1990, which granted defendant’s motion *568pursuant to CPLR 5015 (a) (1) to vacate a default judgment, unanimously affirmed, with costs.
After approximately 20 months of negotiation, the defendant insurance company was served by plaintiff with a summons and verified complaint on August 14, 1989. On September 12, 1989, the claims representative for the defendant requested and received an extension to interpose the answer until October 15, 1989, but failed to do so because she believed the matters raised in the verified complaint would be resolved informally. The defendant served an answer on April 2, 1990, approximately two weeks after the default judgment was entered.
The lower court did not abuse its discretion in vacating defendant’s default judgment, as the record establishes that defendant did not intend to abandon the action, and that plaintiff was not prejudiced by the default. (Arred Enters. Corp. v Indemnity Ins. Co., 108 AD2d 624.) Moreover, defendant’s 5-V2 month delay in moving to vacate the judgment was not inordinate under the circumstances. In view of the dispute as to the term "property damage” as appears in the policy herein, defendant has sufficiently established a meritorious defense. Concur—Sullivan, J. P., Carro, Milonas, Asch and Kassal, JJ.