Archives: Insurance

Subscribe to Insurance RSS Feed

When Is a Claim for Rescission Ripe for Adjudication?

Once in a while an insurance company learns that its insured did not accurately portray its risk when applying for the insurance policy.  In many cases, the insurance company will just cancel the policy, but sometimes the insurance company will want to rescind the policy so that no claims can be filed for the period … Continue Reading

Partial Final Award Not Ripe For Confirmation

Under Section 9 of the Federal Arbitration Act, a court must confirm an arbitration award when a timely request is made unless there is a basis to vacate or modify the award.  But a court has no ability to confirm an arbitration award unless the award is considered a “final” award.  The law in virtually … Continue Reading

Arbitration of Insurance Coverage Disputes

Coverage disputes between insurance carriers and policyholders are ripe for resolution through arbitration.  ARIAS•U.S. is working on a project to create an arbitration pathway, including modified rules and requirements for certified arbitrators, for these types of disputes and others.  But unless the parties agree or the insurance contract contains an arbitration clause, the arbitration option … Continue Reading

When Arbitrators Exceed Their Powers

When an arbitration panel issues a final award any challenge to that award faces an uphill battle.  That is because under the Federal Arbitration Act (“FAA”) a final arbitration award must be confirmed (if requested) and can only be vacated for a very narrow set of reasons.  Of the four grounds for vacatur under Section … Continue Reading

Pleading Standards and Consequential Damages In Coverage Disputes

When a policyholder sues its carrier for breach of contract or bad faith, one question that arises is whether the policyholder should have to plead alleged damages with particularity, or whether the policyholder can sustain its claims with less specific allegations.  A New York appellate court recently declined to impose that higher, particularity standard.… Continue Reading

Delaware Superior Court Excludes Coverage for Directors Acting in Dual Capacity as Investors

Directors and officers (“D&O”) liability insurance generally protects directors and officers against legal expenses and personal liability for acts and omissions taken in their capacity as directors and officers of the insured company.  In a recent case, coverage was excluded where directors also acted as investors of the company.… Continue Reading

Can English Law Insurance Policies Cover Fines Imposed Under GDPR?

When the General Data Protection Regulation (“GDPR”) passed into English law on 25 May 2018, one of the headlines that heralded the new legislation was the Information Commissioner Office’s (“ICO”) new power to impose fines of up to €20million, or 4% of global turnover (whichever is the higher) on organisations that breach the GDPR.  Given … Continue Reading

Some Thoughts on Proving an Insurance Contract in Court

Insurance companies often have their backs against the wall in any dispute.  Typically, in a coverage or premium action brought by the insurance company, it bears the burden of proving its insurance contract and any exclusionary endorsements.  In inter-company disputes that may be a bit easier and the rules may be a bit looser (e.g., … Continue Reading

New York Appellate Court Upholds Title Insurance Kickback Regulation

Last summer, a New York state motion court granted a petition by the title insurance industry challenging a New York State Department of Financial Services (“DFS”) regulation promulgated to prohibit certain practices affecting title insurance costs.  That order has now been modified by an appellate court and the petition has been denied except for two … Continue Reading

Arbitration Awards and Confidentiality Revisited

In reinsurance arbitrations, most parties agree to confidentiality and enter into a formal confidentiality order.  The confidentiality order typically applies to the final award as well as all materials generated in the arbitration.  Some insurance and reinsurance agreements have confidentiality provisions that lead to the same result.  The ARIAS-U.S. Rules for U.S. Insurance & Reinsurance … Continue Reading

As the Commercial Market Expands Government Terrorism Mechanisms Pull Back

In response to the terrorist attacks of the 2000s, a number of governments established insurance-like mechanisms to address the catastrophic effects of a terrorist attack.  One of the early state-backed facilities is the UK’s Pool Reinsurance Company, Ltd. (“Pool Re”), which was actually set up in the 1990s to address events sparked by the unrest … Continue Reading

Ninth Circuit Sends Conflict Between Representations of Authorized Insurer Agent and Certificate of Insurance to Washington Supreme Court

Certificates of insurance are ubiquitous in construction projects and in many other industries.  But, as most jurisdictions hold, a certificate of insurance is not the functional equivalent of the insurance policy and cannot be used to amend, extend or alter coverage.  It is merely a piece of paper informing the recipients that insurance has been obtained.  … Continue Reading

No Coverage for a Claim of Impairment of Goodwill and Reputation Under Defamation Endorsement

When a business gets sued it looks to its various insurance policies for coverage and a defense.  But sometimes the insurance policy purchased does not fit the coverage sought.  That was the case in the Seventh Circuit where a restaurant company sought coverage for a claim brought by a television provider for damages when the … Continue Reading

Advertising Injury and Offering For Sale

Whether an activity is advertising such that it comes within the advertising injury coverage grant of a commercial general liability (CGL) policy is a difficult and complicated question.  Maybe it shouldn’t be, but the coverage grant combined with exclusions to avoid coverage for intellectual property infringement claims and coverage write-backs within exclusions makes it complicated. … Continue Reading

Windstorm, Storm Surge, Flood Exclusion and Anti-Concurrent Causation Confusion

Back in October, the U.S. Court of Appeals for the Second Circuit issued a Summary Order (no precedential effect) in a Hurricane Sandy storm surge coverage dispute.  The court reversed summary judgment in favor of the insurer and remanded the case back to the district court to assess whether an endorsement’s anti-concurrent causation clause conflicts … Continue Reading

Coverage for Government Investigations and Warranty of No Known Claims

Obtaining insurance coverage for a government investigation is often complicated by the type of investigation and the available coverage.  Most policies that cover aspects of government investigations–directors and officers liability policies or errors and omissions policies–are written on a claims-made form and exclude claims that relate back to prior or pending claims.  Very often the … Continue Reading

What Happens When a Policyholder Settles Without Involving Its Insurer?

Nobody likes to get sued.  When a lawsuit or a demand letter comes in, the first thing that crosses the mind of the party being sued (or claimed against) is how can I resolve this quickly?  That may be a reasonable visceral reaction to the suit, but what happens when insurance is involved?… Continue Reading

Ramifications of Global Re v. Century Indemnity Evident in Second Circuit

In late 2017, the New York Court of Appeals, in Global Reinsurance Corp. of Am. v. Century Indemn. Co., 30 N.Y.3d 508 (2017), provided guidance to the Second Circuit Court of Appeals on how New York law interprets reinsurance contracts and, in particular, the stated limits in facultative certificates and whether those stated limits are … Continue Reading

Is a Failure to Disclaim Coverage an Unfair Claim Settlement Practice for a Risk Retention Group?

The application of New York Insurance Law § 3420(d)(2), which requires notice of disclaimer as soon as reasonably possible under a liability policy, has resulted in quite a few cases testing its outer limits and proper implementation.  In a recent case, a New York intermediate appellate court was asked to address § 3420(d)(2)’s application in the … Continue Reading

Interplay Between Reinsurance and Self-Insured Workers’ Compensation

There is a somewhat complicated statutory scheme in many states concerning an employer’s ability to self-insure its workers’ compensation obligations. Reinsurance often plays a role where an employer self-insures. Typically, that role is to provide “reinsurance” in excess of a self-insured retention to protect the employer’s top end.  If an employer fails to insure or … Continue Reading

New York Court of Appeals Looks to Policy Language Again to Allocate Risk Proportionately to Insurers

On March 27, 2018, New York’s highest court finally brought closure to an appeal of a 2014 decision denying an insurer’s motion for partial summary judgment in its coverage litigation with its policyholder.  The Court of Appeals’ decision in Keyspan Gas East Corp. v. Munich Reinsurance America, Inc. is available here.  In affirming the Appellate … Continue Reading

Direct Claims Against Reinsurer Fail to Succeed

Direct actions against reinsurers have been on the rise for some time.  To bring a direct action, a policyholder must get over the contractual privity hurdle and find some basis to show a direct relationship or third-party beneficiary relationship.  Many policyholders try to bring these actions, but they more often than not fail at the … Continue Reading
LexBlog