Archives: Insurance

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Eleventh Circuit Holds That Face Value of Policies Establishes the Amount-In-Controversy for Equitable Claims

The life insurance industry has seen a significant number of class actions brought against it for allegedly wrongful conduct in increasing the cost of insurance (“COI”) component of the policy premium.  In many of these cases, the life insurance company will remove a state case to federal court under the Class Action Fairness Act (“CAFA”).  … Continue Reading

New York Court of Appeals Clarifies No Private Right of Action Against Insurers Who Report Possible Professional Misconduct

Insurance fraud is a big deal and costs all of us plenty in the way of increased insurance premiums.  When automobile liability insurers see claims where they question whether the medical provider is acting appropriately, they may choose to report their findings to the state medical disciplinary authority.  If the disciplinary authority declines to impose … Continue Reading

Strict Conditions Doom Flood Insurance Claim

The National Flood Insurance Program has been controversial to say the least.  Part of the program allows commercial insurance companies to act as agents for the federal government in producing Standard Flood Insurance policies and managing claims under a write your own program (“WYO”).  The program, under its enabling law, the National Flood Insurance Act, … Continue Reading

Foundations, Basement Walls and Collapse — Connecticut Supreme Court Rules Against Coverage

Homeowners in Connecticut (and other states) have had issues with crumbling foundations and basement walls of their homes due to defective concrete manufactured by a specific supplier.  They have turned to their homeowners insurance policies for coverage and coverage has been denied.  Multiple lawsuits have been brought.  In a series of recent cases, the Connecticut … Continue Reading

Late Notice and Timely Disclaimer Sink Claim to Recover Judgment From Insurers

Under New York law (and the law of other jurisdictions), an unsatisfied judgment against an insured may be the subject of an action to recover the judgment against the insurance company.   Sounds simple, but the claimant, standing in the shoes of the policyholder, will be subject to all the defenses the insurance company can bring … Continue Reading

Appraisal Award Ends Property Damage Dispute

Property insurance policies contain provisions to resolve disputes between the policyholder and the insurer over damage claims.  These provisions provide for an independent appraisal of the alleged damaged property with the appraiser’s final award binding the parties.  An appraisal award is akin to an arbitration award in many respects.  In a recent case, a policyholder … Continue Reading

Outside Business Exclusion Precludes Coverage Under a Professional Liability Policy

Professional liability and other errors and omissions policies are purchased to protect the insured from claims brought against the insured by third-parties alleging breaches of professional duties and other failures to perform professional or other services appropriately.  Stated another way a professional liability policy issued to a law firm protects the law firm and its … Continue Reading

Nothing Cheesy About Needing to Allege Personal Injury for Coverage

Nearly all commercial general liability and excess liability insurance policies require in their coverage grants that the damages the insureds are legally obligated to pay are because of bodily injury or property damage.  It may seem simple, but for insurance to apply, the allegations made have to fit reasonably within the coverage provided.   In a … Continue Reading

Contra Proferentem and Ambiguity Preclude Subrogation Recovery

Here’s a typical scenario.  The general contractor or owner takes out a all-risk builder’s policy to cover a construction project.  Subcontractors are included as additional insureds where required by their subcontracts, but only “as their respective interests may appear.”  The policy has a subrogation clause, but the clause includes a provision precluding subrogation against additional … Continue Reading

Appellate Court Clears Up Confusion About Exclusions In Commercial Auto Policies

Like most liability policies, commercial auto policies have exclusions meant to preclude claims by employees against the employer-policyholder.  In a recent case in the Fourth Circuit, under West Virginia law, the court vacated a district court’s judgment of no coverage in favor of the insurer based on exclusions.… Continue Reading

In State Court It’s Just as Tough to Vacate an Arbitration Award

Most commercial arbitrations fall under the Federal Arbitration Act.  But some arbitrations are intra-state so they come within the various state arbitration laws.  In New York, for example, Article 75 of the Civil Practice Law and Rules governs arbitration.  When it comes to vacating an arbitration award, however, choosing state law over the FAA is … Continue Reading

Not an Accident When Victim is Intentionally Dragged By the Hair

When someone gets injured and sues, sometimes the defendant defaults and the claimant is left to pursue its remedies against the defendant’s insurance policy.  It’s basically a coverage suit, but brought by the claimant instead of the policyholder.  The same defenses to coverage also apply.  Paramount, however, is that the loss complained of has to … Continue Reading

Is Reinsurance Information Relevant In an Insurance Coverage Case?

There are lots of cases discussing the production of reinsurance contracts and reinsurance communications in insurance coverage disputes.  Generally, the answer depends on the specific facts of the case.  Recently, in a coverage case based on headline events, a New York motion court upheld a referee’s order for production of both reinsurance contracts and reinsurance … Continue Reading

Are Repair Costs Covered Damages Under a Liability Policy?

Liability policies cover sums an insured becomes legally obligated to pay to a third-party as damages for a loss.  Typically, there is no coverage in a liability policy for expenses incurred by the insured to repair damage to the insured’s own property.  Additionally, nearly every liability policy has an owned-property exclusion.  In a recent case, … Continue Reading

The 5th Amendment and Insurance Coverage

When a property is destroyed by fire, the property owner’s property insurance likely will cover the loss all things being equal.  But if the fire was intentionally set, coverage likely will be denied.  In the case of a residential property, policies often condition coverage on occupation of the premises.  In a recent case before the … Continue Reading

Is Faulty Workmanship an “Occurrence” Under a CGL Policy?

Manufacturers often face multiple lawsuits when their products fail to perform as expected.  Sometimes, the cause of the product’s failure is the faulty workmanship of a component manufacturer.  When that is the case, the product manufacturer will seek damages from the component manufacturer for the underlying product defect claims.  The component manufacturer will then turn … Continue Reading

Ohio Supreme Court to Confront Whether Return Premium Required Before Seeking Rescission

The Ohio Supreme Court recently accepted a case that presents two issues with significant implications for insurers seeking to void policies based upon misstatements in policy applications: (1) whether “an insurance policy sufficiently warns the insured of the consequences of warranty misstatements where the policy states that it ‘may be held void ab initio,’” and (2) whether … Continue Reading

Non-Signatory Surety Bound By Arbitration Clause in Incorporated Contract

An arbitration provision in a contract typically applies only to the contracting parties.  Where, however, the contract is incorporated by reference into a second agreement, if it is broad enough, the party to the second agreement–although a non-signatory to the original agreement–may find that the arbitration provision applies to them as well.  This was the … Continue Reading

No Point in “Wining” About It — No Coverage for Missing Wine

In an interesting case about wine and wine collectors, purchasers of fine wines sought coverage for wine they ordered from a seller but never received.  Turns out the seller was running a wine Ponzi scheme and hundreds of customers never received thousands of bottles of wine ordered.  The case reached the Tenth Circuit Court of … Continue Reading

Does a Directors and Officers Insurance Policy Cover the Settlement of Criminal Charges?

Directors and Officers (“D&O”) insurance policies cover individuals and entities for a wide variety of claims for “wrongful acts.”  Many D&O policies provide coverage for claims based on criminal proceedings.  When criminal charges are settled against corporations and officers, very often the settlement includes fines, penalties, cost of investigation and other payments.  Are these payments … Continue Reading
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