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Mealey's California Insurance

  • August 9, 2017

    Auto Exclusion Bars Claims, Federal Judge Says In Dismissing Assignee’s Suit

    SAN DIEGO — A California federal judge on July 25 granted an insurer’s motion to dismiss an assignee’s complaint after determining that the breach of contract and bad faith claims alleged against the insurer could not stand because the insurer had no duty to defend or indemnify its insured in an underlying suit pursuant to the policy’s auto exclusion (Zoe Bernstein v. Nautilus Insurance Co., No. 16-2883, S.D. Calif., 2017 U.S. Dist. LEXIS 116343).

  • August 9, 2017

    Panel Remands For Trial On Execution Of Arbitration Clause Under Reinsurance Agreement

    SAN FRANCISCO — Vacating a lower court’s judgment, the Ninth Circuit U.S. Court of Appeals on Aug. 4 remanded a dispute for a trial on whether a corn and flour tortilla maker executed arbitration agreements under a reinsurance participation agreement (RPA) or a request to bind coverages and services (Arevalo Tortilleria Inc. v. Applied Underwriters Captive Risk Assurance Company Inc., No. 15-56830, 9th Cir., 2017 U.S. App. LEXIS 14399).

  • August 8, 2017

    Federal Judge Dismisses Disability-Related Coverage Claims As Time-Barred

    SAN DIEGO — A California federal judge on Aug. 3 granted an insurer’s motion to dismiss claims for breach of contract and fraud in relation to its denial of long-term disability (LTD) benefits for a university employee, finding that all of the employee’s claims were untimely (Laurel Davis v. Liberty Life Assurance Company of Boston, No. 3:17-cv-00738, S.D. Calif., 2017 U.S. Dist. LEXIS 122776).

  • August 1, 2017

    Insureds Say Trial Court Did Not Consider All Evidence In Water Damage Suit

    LOS ANGELES — Homeowners seeking coverage for water and mold damages to their home argue in a June 16 brief to the Second District California Court of Appeal that a trial court failed to consider the weight of the evidence supporting the insureds’ claim when it entered judgment for the insurer (Roger Novack, et al., v. Pacific Specialty Insurance Co., et al., No. B278121, Calif. App., 2nd Dist., Div. 1, 2017 CA App. Ct. Briefs LEXIS 2924).

  • August 1, 2017

    Interpretation Of Plan’s Terms Was Reasonable Based On Extrinsic Evidence

    SAN FRANCISCO — The Ninth Circuit U.S. Court of Appeals on July 28 affirmed a district court’s ruling that a pension plan had the discretion to decide which level of disability retirement benefits should be paid to a plan participant and that the interpretation of the plan’s terms by the plan’s board of trustees was reasonable based on the extrinsic evidence (Harold Davis v. Pension Trust Fund for Operating Engineers, et al., No. 15-17212, 9th Cir., 2017 U.S. App. LEXIS 13727).

  • August 1, 2017

    Disability Claimant Awarded Attorney Fees, Costs As The Prevailing Party

    LOS ANGELES — A California federal judge on July 24 awarded a disability claimant more than $100,000 in attorney fees and costs because the claimant prevailed on his claim for disability benefits (Avery Armani v. Northwestern Mutual Life Insurance Co., et al., No. 13-7058, C.D. Calif., 2017 U.S. Dist. LEXIS 117203).

  • July 27, 2017

    Judge Approves Financial Report, Administration Costs In Liquidation Of Insurer

    SAN FRANCISCO — In the liquidation proceedings of CastlePoint National Insurance Co., a California trial judge on July 18 approved and ratified a financial report and expenses of administration totaling $7.8 million concerning the insurer’s period of conservation (Dave Jones v. CastlePoint National Insurance Co., No. CPF-16-515183, Calif. Super., San Francisco Co.).

  • July 26, 2017

    Disability Claimant Met Burden Of Proving She Was Disabled Under Plan

    SAN FRANCISCO — A California federal judge on July 24 determined  that a disability claimant is entitled to long-term disability benefits because the claimant met her burden of proving that she was disabled according to the terms of the plan at issue (Hadar Meiri v. Hartford Life and Accident Insurance Co., No. 16-103, N.D. Calif., 2017 U.S. Dist. LEXIS 115224).

  • July 24, 2017

    Excess Insurer Seeks Review By California High Court On Issue Of Policy Exhaustion

    LOS ANGELES — In a June 27 petition for review filed in the California Supreme Court, an excess insurer says the high court should accept review of a silica coverage suit because the appellate court failed to address what constitutes proper exhaustion of the primary insurance policy at issue (Truck Insurance Exchange v. Moldex Metric Inc., et al., No. S242845, Calif. Sup., 2017 CA S. Ct. Briefs LEXIS 1064).

  • July 21, 2017

    California Federal Judge Allows Claims To Stand In Life Insurance Rate Case

    LOS ANGELES — A California federal judge on July 10 determined that plaintiffs alleging that a life insurer wrongfully increased monthly deduction rates alleged sufficient facts to support their claims for breach of contract and bad faith (EFG Back AG, Cayman Branch, v. Transamerica Life Insurance Co., No. 16-8104, C.D. Calif., 2017 U.S. Dist. LEXIS 109780).

  • July 20, 2017

    California Federal Judge Says No Additional Coverage Owed To Beneficiaries

    LOS ANGELES — Beneficiaries of a director of photography who was killed in a helicopter crash while working on the production of a reality television show are not entitled to coverage under an accidental death and dismemberment policy because the insured was not a “participant” on the reality show, a California federal judge said July 7 in granting the insurer’s motion for summary judgment on claims for breach of contract and bad faith (Jerie S. Rydstrom, et al. v. Federal Insurance Co., et al., No. 16-2543, 16-2614, C.D. Calif., 2017 U.S. Dist. LEXIS 105473).

  • July 20, 2017

    Disability Plan’s Discretionary Authority Provision Is Void Under California Law

    SACRAMENTO, Calif. — A de novo standard of review must be applied in a denial of disability benefits suit because the disability plan’s discretionary authority provision is not valid under California law, a California federal judge said July 12 in granting the disability claimant’s motion for summary judgment (Renee Johnson Monroe v. Metropolitan Life Insurance Co., No. 15-2079, E.D. Calif., 2017 U.S. Dist. LEXIS 109012).

  • July 20, 2017

    Federal Judge Dismisses Suit Seeking Rescission Of Products Liability Insurance

    SAN FRANCISCO — A federal judge on June 13 dismissed a rescission lawsuit after the primary products liability insurer and the manufacturer of the da Vinci Surgical System announced that they have reached a settlement (Illinois Union Insurance Co., et al. v. Intuitive Surgical Inc., No. 13-04863, N.D. Calif.).

  • July 19, 2017

    Insured Asks 9th Circuit To Find Loss Of Boats Was Due To Theft And Not Scheme

    SAN FRANCISCO — A boat business insured has asked the Ninth Circuit U.S. Court of Appeals to reverse a lower federal court’s finding that an insurer did not breach an all-risk policy in bad faith by denying coverage for its theft claim (Pacific Marine Center, Inc. v. Philadelphia Indemnity Insurance Co., No. 17-15897, 9th Cir.).

  • July 18, 2017

    Panel: CIGA Has Duty To Reimburse For Workers’ Comp Excess Coverage

    SACRAMENTO, Calif. — The California Insurance Guarantee Association (CIGA) breached its statutory duty to reimburse a joint powers authority for excess workers’ compensation coverage owed under an insolvent insurer’s policy, a California appeals panel affirmed July 17 (CSAC Excess Insurance Authority v. California Insurance Guarantee Association, No. C081775, Calif. App., 3rd Dist., 2017 Cal. App. Unpub. LEXIS 4854).

  • July 17, 2017

    California Federal Judge Allows Plaintiff To Amend Complaint In Life Insurance Dispute

    SACRAMENTO, Calif. — A California federal judge on July 7 granted a life insurance beneficiary’s motion to amend a complaint after determining that the amendment addresses the insurer’s challenges to the beneficiary’s standing to pursue the claims and the insurer’s argument that the claims are time-barred (Yegeniy V. Sidorov, in his individual capacity and as administrator of the estate of Natalya N. Natalya, v. Transamerica Life Insurance Company, et al., No. 17-00002, E.D. Calif., 2017 U.S. Dist. LEXIS 105479).

  • July 13, 2017

    Professional Services Exclusion Bars Coverage For Pipeline Explosion, Panel Says

    SAN FRANCISCO — The First District California Court of Appeal on July 11 affirmed a trial court’s  judgment in favor of an excess insurer after finding that its policy’s professional services exclusion bars  coverage for underlying claims arising from a deadly pipeline explosion (Energy Insurance Mutual Limited v. Ace American Insurance Co., No. A140656, Calif. App., 1st Dist., Div. 4).

  • July 11, 2017

    Excess Insurer Entitled To Recover $5M Settlement Payment, 9th Circuit Affirms

    SAN FRANCISCO — The Ninth Circuit U.S. Court of Appeals on July 7 affirmed a lower federal court’s finding that a software firm insured's former first-layer excess directors and officers liability insurer is entitled to recover the $5 million it paid to settle an underlying securities action plus prejudgment interest from the insured's latter first-layer excess directors and officers liability insurer (Genesis Insurance Co. v. Magma Design Automation Inc. v. National Union Fire Insurance Company of Pittsburgh, Pa., No. 15-16999, 9th Cir., 2017 U.S. App. LEXIS 12194).

  • July 11, 2017

    California Panel Affirms No Coverage Due For Damage To Underground Storage Tank

    LOS ANGELES — An insured is not entitled to coverage for the collapse of an underground storage tank because an impairment of the tank’s structural integrity does not qualify as an actual collapse for which coverage is afforded under the policy, the Second District California Court of Appeal said July 3 (Tustin Field Gas & Food, Inc., v. Mid-Century Insurance Company, No. B268850, Calif. App., 2nd Dist., Div. 2, 2017 Cal. App. LEXIS 602).

  • July 10, 2017

    Rescission Lawsuit Is Not ‘Exceptional’ To Justify Abstention, 9th Circuit Rules

    SAN FRANCISCO — The Ninth Circuit U.S. Court of Appeals on July 5 found that a lower court’s grant of an insured’s request for abstention under Colorado River Water Conservation District v. United States, 424 U.S. 800 (1979), was an abuse of its narrow discretion because the insurer’s rescission lawsuit is not "exceptional" to warrant disregarding a federal court’s obligation to exercise its jurisdiction (Seneca Insurance Co. Inc. v. Strange Land Inc., et al., No. 15-16011, 9th Cir., 2017 U.S. App. LEXIS 11946).