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Mealey's Insurance

  • January 23, 2020

    New York Federal Judge Dismisses Suit Seeking Additional Coverage For Water Damage

    BROOKLYN, N.Y. — Breach of contract and bad faith claims alleged against a homeowners insurer following a dispute over coverage for water damages must be dismissed because the insureds failed to file suit within two years of the loss as required by the policy’s limitations provision, a New York federal judge said Jan. 22 (Mildred Guy, et al. v. The Automobile Insurance Company of Hartford Connecticut, et al., No. 18-2620, E.D. N.Y., 2020 U.S. Dist. LEXIS 10701).

  • January 23, 2020

    Judge Denies Motion To Dismiss, Says Exception To Bacteria Exclusion May Apply

    CENTRAL ISLIP,  N.Y. — A New York federal judge on Jan. 22 denied an insurer’s motion to dismiss another insurer’s claim seeking coverage, on behalf of its insured, for underlying personal injury suits arising out of the exposure to Legionella bacteria because it is not clear whether an exception to a fungi or bacteria exclusion applies to provide coverage for the underlying suits (Philadelphia Indemnity Insurance Co. v. Indian Harbor Insurance Co., No. 18-5014, E.D. N.Y., 2020 U.S. Dist. LEXIS 10651).

  • January 22, 2020

    Pollution Exclusion Bars Coverage For Stream Contaminated With Rock Pellets

    NEW ORLEANS — A district court correctly concluded that an insured quarry operator’s unplanned discharge of rock pellets into a nearby stream is excluded from coverage pursuant to the policy’s pollution exclusion because the rock pellets are contaminants, the Fifth Circuit U.S. Court of Appeals said Jan. 17 (Eastern Concrete Materials Inc. v. ACE American Insurance Co., et al., No. 18-11043, 5th Cir., 2020 U.S. App. LEXIS 1680).

  • January 21, 2020

    Insurer Responsible Only For Pro Rata Portion Of Judgment In Lead Coverage Dispute

    BALTIMORE — The Maryland Court of Special Appeals on Jan. 8 determined that an insurer is obligated to indemnify its insured only for bodily injuries caused by the exposure to lead paint that occurred during the insurer’s policy period and further said that the insurer is not obligated to provide coverage for exposure to lead while an unborn child was in utero because there is no evidence as to when any injuries occurred while the child was in utero (Pennsylvania National Mutual Casualty Insurance Co. v. Tajah Jeffers, et al., No. 960,  Md. Spec. App., 2020 Md. App. LEXIS 26).

  • January 21, 2020

    No Defense, Indemnification Owed For Damages Caused By Dumping Of Concrete

    NEW YORK — A commercial auto insurer has no duty to defend or indemnify a third-party defendant in an underlying suit alleging damages caused by water contamination and flooding as a result of the illegal dumping of concrete slurry because the underlying damages occurred before the insurer’s effective policy period, a New York justice said Jan. 9 (American States Insurance Co., et al. v. Graphic Arts Mutual Insurance Co., et al., No. 651372/2018, N.Y. Sup., New York Co., 2020 N.Y. Misc. LEXIS 127).

  • January 21, 2020

    Settling Insurers Say Stay Against Contribution Claims Should Remain In Place

    TACOMA, Wash. — A Washington federal bankruptcy court’s denial of an insurer’s bid to vacate a stay order barring its contribution claims against other insurers for asbestos claims against Chapter 11 debtor Fraser’s Boiler Service Inc. is only an interlocutory ruling and is therefore not appealable, the other insurers, who have settled with the debtor, say in a Jan. 10 appellee brief in federal court (National Union Fire Insurance Company of Pittsburgh, PA v. Fraser’s Boiler Service, Inc., et al., No. 3:19-cv-5648, W.D. Wash.).

  • January 21, 2020

    Bankruptcy Court Maps Plan To Resolve Final Issues In Debtor, Insurer Row

    NEW YORK — A New York federal bankruptcy judge issued a scheduling order Jan. 16 for resolution of the remaining issues in a long-running dispute between Chapter 11 debtor Rapid-American Corp. and insurers over coverage for asbestos liability while the parties await his ruling on their last round of summary judgment briefing (Rapid-American Corporation, et al. v. Travelers Casualty and Surety Company, et al., No. 15-01095, S.D. N.Y. Bkcy.).

  • January 16, 2020

    No Coverage Owed For Environmental Contamination Claims, Panel Says

    SHREVEPORT, La. — No coverage is afforded for environmental contamination claims because the contamination claims were not reported within 60 days following the end of the applicable policy as required by the policy, the Second Circuit Louisiana Court of Appeal said Jan. 14 (Kansas City Southern Railway Co. et al., v. The Wood Energy Group Inc. et al., Nos. 53,096, 53,099, La. App., 2nd Cir., 2020 La. App. LEXIS 61). 

  • January 16, 2020

    Breach Of Contract, Vexatious Refusal To Pay Claims Can Proceed In Asbestos Dispute

    SPRINGFIELD, Mo. — A Missouri federal judge on Jan. 14 denied an insurer’s motion for summary judgment on breach of contract and vexatious refusal to pay claims arising out of an asbestos coverage dispute after determining that the insured presented sufficient evidence that the insurer breached its contract when it ceased defending the insured based on the insurer’s incorrect belief that the primary policies’ limits were exhausted (O’Reilly Auto Enterprises LLC v. United States Fire Insurance Co. et al., No. 17-3007, W.D. Mo., 2020 U.S. Dist. LEXIS 5910).

  • January 15, 2020

    Insurer: No Coverage For Defective HVAC System In Student Housing Complex

    BIRMINGHAM, Ala. — An insurer alleges in a Jan. 10 complaint filed in an Alabama federal court that coverage does not exist for an additional insured for claims arising out of allegedly defective heating, ventilation and air conditioning (HVAC) installation work in a student housing complex because there is no “occurrence” and the work is otherwise excluded (Pennsylvania National Mutual Casualty Insurance Co. v. 3D Air Services, LLC, et al., No. 20-43, N.D. Ala.).

  • January 15, 2020

    No Coverage For Water Damage Caused By Overflowing Toilet, New York Justice Says

    NEW YORK — A New York County Supreme Court justice on Jan. 7 granted summary judgment to a property insurer after determining that the policy excludes coverage for water damage caused by an overflowing toilet in one of the insured’s condominium units (193 Hooper Street Condo v. Wesco Insurance Co., No. 657266/2017, N.Y. Sup., New York Co.). 

  • January 12, 2020

    Excess Insurers’ Denials Of Coverage Were Not Unfair Or Deceptive, Judge Says

    RALEIGH, N.C. — Insureds seeking coverage for underlying lawsuits arising out of the operation of a hog farm failed to support their contention that their excess insurers’ denials of coverage based on pollution exclusions in the excess policies were an unfair or deceptive trade practice, a North Carolina judge said Dec. 16 (Murphy-Brown LLC, et al. v. ACE American Insurance Co., et al., No. 19-2793, N.C. Super, Wake Co., 2019 NCBC LEXIS 110).

  • January 12, 2020

    Magistrate Judge Says Pollution Exclusion Bars Coverage For Black Powder

    PITTSBURGH — A Pennsylvania federal magistrate judge on Dec. 31 recommended granting an insurer’s motion for summary judgment and denying an insured’s motion for summary judgment because it is clear that a pollution exclusion bars coverage for a black powder that contaminated the insured’s property (Vale Vista Associates L.P. v. The Cincinnati Casualty Co., No. 18-1064, W.D. Pa., 2019 U.S. Dist. LEXIS 223366).

  • January 12, 2020

    Insurer Owes Coverage For Lead Paint Dust Contamination, Illinois Panel Says

    CHICAGO — A trial court erred in granting judgment in favor of a commercial general liability insurer because an underlying complaint filed against the insured seeking damages for lead paint dust contamination alleges an occurrence and constitutes property damage for which coverage is afforded, the an Illinois appellate panel said Dec. 31 (Owners Insurance Co. v. Precision Painting & Decorating Corp., No. 1-19-0926,  Ill. App., 1st Dist., Div. 3, 2019 Ill. App. Unpub. LEXIS 2425).

  • January 10, 2020

    7th Circuit Hears Oral Arguments In Environmental Contamination Dispute​​​​​​​

    CHICAGO —The Seventh Circuit U.S. Court of Appeals on Jan. 8 heard oral arguments in an environmental contamination coverage suit and will decide if a district court properly found that an insurer owes no coverage for environmental contamination claims asserted by neighbors based on the insured’s alleged late notice (Carmine Greene, et al. v. Kenneth Will, et al., No. 19-2260, 7th Cir.).

  • January 10, 2020

    No Coverage For Water Damage To Exterior Insulation Finishing System, Panel Affirms

    DENVER — The 10th Circuit U.S. Court of Appeals on Jan. 9 held that the “flawed design” of a home’s exterior insulation finishing system (EIFS) constitutes “faulty design” and, therefore, there is no coverage for water damage discovered within the EIFS (Mark Mock, et al. v. Allstate Insurance Company, No. 18-1407, 10th Cir.).

  • January 06, 2020

    8th Circuit Affirms No Coverage Ruling For Losses Related To Rock Falls

    ST. LOUIS — The Eighth Circuit U.S. Court of Appeals on Jan. 3 affirmed a lower federal court's ruling in favor of primary and excess insurers in the insurers' lawsuit disputing coverage for its losses related to four rock falls, rejecting the insured’s argument that the dome-outs were caused by “building decay” under the policy (Westchester Surplus Lines Insurance Company, et al. v. Interstate Underground Warehouse & Storage Inc., No. 18-3448, 8th Cir.).

  • January 06, 2020

    Suit Limitations Provisions Do Not Bar Suit Seeking Coverage For Hidden Damage

    PORTLAND, Ore. — An Oregon federal judge on Dec. 20 determined that suit limitations provisions in two insurers’ policies do not bar an insureds’ suit seeking coverage for hidden water damage because the term “occurred” as used in the limitations provisions is ambiguous and must be construed in favor of the insured (Housing Northwest Inc. v. American Insurance Co., et al., No. 19-253, D. Ore.,  2019 U.S. Dist. LEXIS 219168).

  • January 06, 2020

    No Coverage Owed For Mold Caused By Defective Installation Of Insulation

    SALT LAKE CITY — No coverage is owed to an insured for an underlying suit alleging that the insured’s installation of attic insulation caused mold to develop in attics of condominium buildings because the installation of the insulation does not constitute an occurrence, a Utah federal judge said Dec. 23 in granting the insurer’s motion for summary judgment (Cincinnati Specialty Underwriters Insurance Co. v. Green  Property Solutions LLC, et al., No. 19-00010, D. Utah, 2019 U.S. Dist. LEXIS 220161).

  • January 06, 2020

    No Coverage Owed For Water Damage To Insured’s Underground Storage Tanks

    BOISE, Idaho — The Idaho Supreme Court on Dec. 23 affirmed a trial court’s summary judgment ruling in favor of an insurer on breach of contract and bad faith claims because the policy’s water exclusion clearly bars coverage for water damages to the insured’s underground storage tanks (USTs) (ABK LLC v. Mid-Century Insurance Co., No. 46430, Idaho Sup., 2019 Ida. LEXIS 257).