Mealey's California Insurance

  • May 11, 2021

    Los Angeles Restaurant Owner Seeks Reversal Of No Coverage Ruling In COVID-19 Suit

    SAN FRANCISCO — The owner of two Los Angeles restaurants recently asked the Ninth Circuit U.S. Court of Appeals to reverse a lower federal court’s dismissal of its lawsuit seeking coverage for its business income loss caused by the governmental shutdown orders in response to the coronavirus pandemic, contending that the lower court dismissed its complaint “based on a range of hypothetical policy consequences” that render its interpretation of the policy “unreasonable — even if conceivable.”

  • May 10, 2021

    Arbitration Of Auto Claim Warranted; Bad Faith Claim Can Proceed After Arbitration

    SAN FRANCISCO — A trial court erred in denying an auto insurer’s motion to compel arbitration because the insurer was entitled to arbitrate the insured’s claim for underinsured motorist benefits under California law, the First District California Court of Appeal said April 30, noting that the insured could litigate the bad faith claim after the arbitration is complete.

  • May 05, 2021

    Panel Affirms Discovery, Summary Judgment Rulings In Insurance Bad Faith Appeal

    PASADENA, Calif. — A Ninth Circuit U.S. Court of Appeals panel on May 3 ruled that a federal district court did not abuse its discretion in excluding portions of three declarations submitted by a beneficiary in an insurance breach of contract and bad faith lawsuit stemming from insurers’ denial of life insurance benefits and rescission of policies because the declarants lacked the required knowledge of the statements asserted as required.

  • May 04, 2021

    Homebuilders Seek Remand Of Bad Faith Suit Over Insurers’ Failure To Repay

    LOS ANGELES — KB Home Nevada Inc. and three of its affiliates on May 3 filed a motion in federal court in California saying that a lawsuit accusing two insurance companies and a man who claimed to be a claims adjuster and third-party administrator (TPA) of failing to repay more than $10 million in self-insurance retention (SIR) payments made as part of homebuilder protection (HBP) policies should be remanded, arguing that the man is not fraudulently joined because the complaint sufficiently pleads claims for negligent misrepresentation and intentional misrepresentation against him.

  • April 30, 2021

    California Panel Partly Reverses Ruling In Coverage Suit Prompted By Tubbs Wildfire

    SAN FRANCISCO — A California appeals panel held on April 27 that there is a triable issue of material fact regarding a homeowners insurer’s intent when it reinstated an insurance policy after the insureds paid the past due premium, partly reversing a lower court’s ruling in a breach of contract and bad faith lawsuit arising from the insurer’s denial of a claim arising from the 2017 Tubbs wildfire.

  • April 30, 2021

    Insurers’ Claims Against Reinsurer’s Parent Companies To Proceed, Federal Judge Says

    LOS ANGELES — A California federal judge on April 14 denied a motion to dismiss filed by the parent companies of a reinsurer after determining that the insurers sufficiently alleged facts in support of their claims for intentional interference with contractual relation and inducing breach of contract stemming from the insurers’ reinsurance billings.

  • April 30, 2021

    Disability Claimant Failed To Show She Was Disabled From Working In Own Occupation

    SANTA ANA, Calif. — A disability insurer properly denied a claim for long-term disability (LTD) benefits because the claimant failed to show that she was disabled under the terms of the plan and unable to perform the duties of her own occupation, a federal judge said April 16 in granting judgment in favor of the insurer.

  • April 29, 2021

    Breach Of Contract, Bad Faith Suit Arising Out Of Wildfire Damage Was Timely Removed

    LOS ANGELES — A California federal judge on April 26 denied a motion to remand filed by insureds alleging claims for breach of contract and bad faith arising out of a coverage claim for wildfire damages after determining that the property insurer timely filed its notice of removal within 30 days of learning that the insureds were seeking more than $75,000 in damages.

  • April 20, 2021

    Award Of Disability Benefits Is Appropriate Remedy, Federal Judge Determines

    LOS ANGELES — A California federal judge on April 15 awarded a disability claimant past and future long-term disability (LTD) benefits after determining that an award of benefits, rather than remand to the plan administrator, is the appropriate remedy.

  • April 16, 2021

    Insured Sufficiently States Claim Against Insurer’s Claims Adjuster, Judge Says

    LOS ANGELES — A California federal judge on April 14 remanded an insured’s breach of contract, bad faith and negligent misrepresentation suit against a homeowners insurer and the insurer’s claims adjuster after determining that the claims adjuster is not a sham defendant because the insured sufficiently stated a claim for negligent misrepresentation against the claims adjuster who handled the insured’s water damage claim.

  • April 16, 2021

    Panel: D&O Insurer Has No Duty To Defend, Indemnify Against Attorney General’s Suit

    PASADENA, Calif. — The Ninth Circuit U.S. Court of Appeals on April 15 affirmed a lower federal court’s ruling that held that under California Insurance Code Section 533.5, a directors and officers liability insurer has no duty to defend or indemnify its insureds against an underlying unfair competition and false advertising lawsuit brought by the California attorney general, finding that Section 533.5 “does not facially violate a party’s due process right to retain counsel.”

  • April 16, 2021

    Split California Panel: Officer Convicted Of Fraud Must Repay Insurance Premiums

    SANTA ANA, Calif. — A 2-1 California appeals panel on April 14 affirmed a judge’s order requiring a former police officer convicted of filing a false workers’ compensation claim to pay $75,427.67 in restitution, with the dissenting judge arguing that the officer should not have to repay $7,782.56 in insurance premiums that were paid by the city of Costa Mesa, Calif., while he was recovering from surgery to remove a brain tumor because it was not tied to his criminal activity.

  • April 13, 2021

    No Coverage Owed For Alleged Phishing Attack, 9th Circuit Affirms

    PASADENA, Calif.—The Ninth Circuit U.S. Court of Appeals on April 9 affirmed a lower federal court’s ruling in favor of an insurer in Alorica Inc.’s lawsuit seeking coverage for its alleged “security failure” that was caused by a phishing attack by an unknown perpetrator, rejecting the insured’s contention that a letter demanding monetary relief from client Express Scripts constituted a “claim” under its “security & privacy risk response” policy.

  • April 13, 2021

    Judge Tosses Suit Alleging Regulators Abused Authority In Pursuing Conservatorship

    SACRAMENTO, Calif. — A federal judge in California on March 31 dismissed the lawsuit of an insurer and its subsidiary alleging that the California insurance commissioner and his deputies violated their constitutional rights and acted in bad faith by filing a conservatorship against a workers’ compensation insurer that is party to a reinsurance participation agreement (RPA), finding that the doctrine of prior exclusive jurisdiction dictates dismissal and alternatively concluding that dismissal under Younger v. Harris is appropriate.

  • April 12, 2021

    9th Circuit Tosses Ruling Favoring Insurer’s Choice Of Counsel Over Contractor’s

    SAN FRANCISCO — A Ninth Circuit U.S. Court of Appeals panel on April 5 vacated an insurance company’s summary judgment award in a suit claiming that it was not required to provide a defense to a construction company based on its refusal to cooperate with the insurer’s counsel and insistence on using its own counsel, holding that a federal judge in California failed to use a substantial prejudice analysis when deciding in favor of the insurer.

  • April 12, 2021

    Panel:  No Coverage For Intentional Conduct Alleged By Insured’s Former Fiancé

    PASADENA Calif.— The Ninth Circuit U.S. Court of Appeals on April 9 affirmed a lower federal court’s summary judgment in favor of a homeowners insurer in an insured’s breach of contract lawsuit seeking coverage for an underlying action brought by her former fiancé, finding that the underlying allegations are based on only intentional conduct that is barred from coverage.

  • April 12, 2021

    Fraud Claim Against Excess Insurer In Asbestos Coverage Dispute Can Proceed

    LOS ANGELES — The Second District California Court of Appeal on April 7 affirmed a trial court’s ruling that a primary insurer met its burden of showingthat it has a probability of prevailing on the merits of a fraud claim against an excess insurer in a dispute over coverage for a mutual insured’s asbestos liabilities.

  • April 12, 2021

    Water Exclusion Bars Coverage For Water Damage At Insureds’ Property, Judge Says

    RIVERSIDE, Calif. — A California federal judge on April 2 entered summary judgment in favor of a property insurer on claims for breach of contract, bad faith and unfair business practices after determining that no coverage is owed under the policy pursuant to the policy’s water exclusion.

  • April 09, 2021

    Fiduciary Liability Policy Exclusion Does Not Bar Coverage, Panel Says In Reversal

    SAN FRANCISCO — The Ninth Circuit U.S. Court of Appeals on April 8 reversed a lower federal court’s ruling that a fiduciary liability insurance policy’s prior and pending proceeding exclusion precluded coverage for an underlying lawsuit brought against its retirement association insured, reversing and remanding.

  • April 08, 2021

    Judge Denies Insured’s Motion To Stay Coverage Suit Arising From Worker Injury

    SAN FRANCISCO — A federal judge in California on April 5 denied an insured’s motion to stay primary and excess commercial insurers’ declaratory judgment lawsuit disputing coverage for an underlying lawsuit alleging that the insured failed to use reasonable care in fulfilling its duty to oversee job site safety regarding the hazards associated with construction yard traffic, finding that the two of the three factors in Landis v. North American Co. weigh against a stay.