Mealey's Insurance Bad Faith
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June 24, 2019
Indiana Appeals Panel Says Insured’s Bad Faith Suit Is Barred By Res Judicata
INDIANAPOLIS — The Indiana Court of Appeals on June 20 affirmed the dismissal of an insured’s breach of contract and bad faith complaint against her homeowners insurer after determining that the insured’s complaint, seeking coverage for water and mold damage, is barred by the doctrine of res judicata because the same claims between the same parties were litigated to a final conclusion on the merits in a prior lawsuit filed by the insured (Brenda White v. American Family Mutual Insurance Co., No. 18A-CT-2874, Ind. App., 2019 Ind. App. Unpub. LEXIS 766).
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June 24, 2019
Insured Failed To Support Claim For Punitive Damages In Water Coverage Dispute
NEWARK, N.J. — An insured homeowner seeking coverage for water damage to her home cannot maintain a claim for punitive damages against her insurer because the insured failed to allege that the insurer’s actions in partially denying her claim were driven by actual malice or a wanton and willful disregard, a New Jersey federal judge said June 20 in dismissing the claim for punitive damages (Elizabeth Johnson v. Encompass Insurance Co., No. 17-3527, D. N.J., 2019 U.S. Dist. LEXIS 103290).
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June 24, 2019
Jury’s Punitive Damages Award Not Contrary To Law, New Mexico Panel Affirms
ALBUQUERQUE, N.M. — A New Mexico Court of Appeals panel on May 23 affirmed a trial court’s denial of an auto insurer’s motion for judgment notwithstanding the verdict after determining that the trial court did not err in allowing a jury’s punitive damages verdict to stand because the jury did, in fact, find that the auto insurer acted in bad faith in its handling of the insured’s auto claim (Claude Wilson v. Farmers Insurance Company of Arizona, No. A-1-CA-36300, N.M. App., 2019 N.M. App. Unpub. LEXIS 140).
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June 24, 2019
Insurer’s Summary Judgment Motion In Insurance Bad Faith Dispute Denied
SAN DIEGO — A federal judge in California on May 31 ruled that genuine issues of material fact exist as to whether an insurer acted in bad faith in its investigation and evaluation of her claim for coverage under an automobile insurance policy, denying the insurer’s motion for summary judgment (Suzanne Mattson v. United Service Automobile Association, et al., No. 18-222, S.D. Calif., 2019 U.S. Dist. LEXIS 91654).
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June 24, 2019
Auto Insurer Permitted To Introduce Evidence Of Payment To Insured
DENVER — A Colorado federal magistrate judge on June 11 determined that an auto insurer will be permitted to introduce evidence regarding its payment of its policy limits to an insured following the insured’s filing of a breach of contract and bad faith suit against the insurer (Beverly Cribari v. Allstate Fire & Casualty Insurance Co., No. 16-2450, D. Colo., 2019 U.S. Dist. LEXIS 97738).
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June 24, 2019
Bad Faith Dispute Over Flood Damage Remanded To State Court
RIVERSIDE, Calif. — A federal judge in California on June 12 ruled that an adjuster was not improperly joined in an insurance breach of contract and bad faith lawsuit against a homeowners insurance provider and remanded the action to state court (Maria Gast v. Universal North America Insurance Co., et al., No. 19-0647, C.D. Calif., 2019 U.S. Dist. LEXIS 99582).
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June 24, 2019
Judge: Third-Party Beneficiary Lacks Standing To Sue Auto Insurer For Bad Faith
HAMMOND, Ind. — A federal judge in Indiana on June 18 ruled that a third-party beneficiary lacks standing to bring a claim for insurance bad faith against an automobile insurance provider because she is not a named insured under the insurance policy for which she sought underinsured motorist coverage (Nicole Schweihs v. State Farm Insurance Co., No. 18-140, N.D. Ind., 2019 U.S. Dist. LEXIS 101475).
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June 21, 2019
Bad Faith Claim Against Homeowners Insurer To Proceed, Federal Judge Says
SCRANTON, Pa. — A claim of bad faith alleged against a homeowners insurer that allegedly refused to adjust a personal property loss estimate following a fire will proceed because the insureds alleged sufficient facts in support of the claim, a Pennsylvania federal judge said June 20 (James Obelkevich, et al. v. Safeco Insurance Company of Illinois, No. 18-1111, M.D. Pa., 2019 U.S. Dist. LEXIS 103177).
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June 20, 2019
Trial Court Properly Refused To Consider Bad Faith Claims, Panel Says
KANSAS CITY, Mo. — The Third Division of the Western District of the Missouri Court of Appeals on June 18 determined that a trial court did not err in refusing to consider the bad faith claims alleged against an insurer because the trial court correctly determined that it had no jurisdiction based on a mandate issued by the Missouri Supreme Court (Franklin D. Allen v. Atain Specialty Insurance Co., No. WD81677, Mo. App., W.D., Div. 3, 2019 Mo. App. LEXIS 961).
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June 19, 2019
Bad Faith Claim To Proceed; Questions Of Fact Exist On Assessment Of Injuries
ORLANDO, Fla. — An auto insurer is not entitled to summary judgment on a bad faith claim brought against the insurer by a third-party claimant who was injured by an insured in an auto accident because questions of fact exist regarding the insurer’s assessment of the claimant’s injuries, a Florida federal judge said June 18 (Robyn Holtzapple v. Nationwide Mutual Fire Insurance Co., No. 17-2026, M.D. Fla., 2019 U.S. Dist. LEXIS 101494).
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June 19, 2019
No Coverage Owed For Water Damage To Vehicle, West Virginia High Court Says
CHARLESTON, W.Va. — A trial court did not err in bifurcating breach of contract claim from a bad faith claim and other extracontractual claims and did not err in granting an auto insurer’s motion for summary judgment on the breach of contract claim because it is clear that no coverage is afforded for water damage to an insured’s vehicle, the West Virginia Supreme Court of Appeals said June 17 (Maurice Dosso v. Farmers and Mechanics Insurance Cos., et al., No. 17-0664, W.Va. Sup., 2019 W. Va. LEXIS 380).
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June 19, 2019
California Panel Affirms No Homeowners Coverage For Jewelry Store Shooting
SAN FRANCISCO — A California appeals panel on June 17 affirmed that there is no coverage under a homeowners insurance policy's personal injury provision for the discharge of a firearm after a robbery attempt, finding that the victim has failed to present any evidence to create a triable issue of material fact as to whether the first shot in the robbery attempt was intentional (CSAA Insurance Exchange, et al. v. Oscar Herrera, No. A153429, Calif. App., 1st Dist., 2019 Cal. App. Unpub. LEXIS 4061).
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June 18, 2019
Federal Judge Says Bad Faith Claim Against Life Insurance Agent Can Proceed
BIRMINGHAM, Ala. — A life insurance agent was not fraudulently joined to a putative class action suit filed against an insurer and the agent because the plaintiffs sufficiently alleged that the agent had a special relationship with the plaintiffs and acted in bad faith by selling the plaintiffs policies that were not appropriate for the plaintiffs’ needs, an Alabama federal judge said June 17 (Kee Goostree, et al. v. Liberty National Life Insurance Co., et al., No. 19-71, N.D. Ala., 2019 U.S. Dist. LEXIS 100604).
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June 17, 2019
Motion To Remand Water, Mold Damage Suit Denied; Judge Says Damages Exceed $75K
BIRMINGHAM, Ala. — An Alabama federal judge on June 14 denied a motion to remand filed by insureds alleging claims for breach of contract and bad faith arising out of a water and mold damage claim after determining that the insurers produced sufficient evidence showing that the amount in controversy exceeds the federal jurisdictional minimum of $75,000 (Matthew B. Menendez, et al. v. American Strategic Insurance Corp., et al., No. 19-443, N.D. Ala., 2019 U.S. Dist. LEXIS 99975).
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June 14, 2019
Panel: Policy’s ‘Classification Limitation’ Does Not Bar Coverage For $5M Judgment
ST. LOUIS — A Missouri appeals panel on June 11 reversed a garnishment court’s finding that an insurance policy’s “Classification Limitation” barred coverage for an underlying $5 million judgment arising from a fatal shooting outside of a night club, finding that the garnishment court was not at liberty to decide whether the night club owner was acting on behalf of another business such that the named insured could not be liable for his negligence (Latronya Adams v. Certain Underwriters at Lloyd's of London, et al., No. ED106121, Mo App., Eastern Dist., Div. 3, 2019 Mo. App. LEXIS 931).
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June 14, 2019
Mississippi Federal Judge Denies Motion To Remand Bad Faith Suit Against Insurer
JACKSON, Miss. — A Mississippi federal judge on June 12 denied an insured’s motion to remand an insurance breach of contract and bad faith suit arising out of a fire damage claim made under a homeowners policy after determining that complete diversity exists because the insurer’s adjuster is not a proper defendant (Tramon Colenburg v. Amica General Agency LLC, et al., No. 19-24, S.D. Miss., 2019 U.S. Dist. LEXIS 98564).
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June 13, 2019
South Carolina High Court Issues Test For Privilege In Insurance Bad Faith Cases
COLUMBIA, S.C. — Addressing a certified question in an insurance bad faith action against an insurer for its failure to defend an insured in a construction defect action, the South Carolina Supreme Court on June 12 answered in the negative and held that “denying liability and/or asserting good faith in the answer does not, standing alone,” waive the attorney-client privilege for claim files (Mt. Hawley Insurance Co. v. ContraVest Inc., et al., No. 2018-001170, S.C. Sup., 2019 S.C. LEXIS 53).
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June 12, 2019
Reinsurer, Affiliates Seek Dismissal Of Counterclaims In Workers’ Comp Dispute
OMAHA, Neb. — A reinsurer and its affiliates moved to dismiss counterclaims on June 7 in their breach of contract dispute over a workers’ compensation program, telling a Nebraska federal court that the counterclaims “are a hodgepodge of conclusory allegations and unsupported assertions that fail to meet basic pleading standards” (Applied Underwriters Captive Risk Assurance Company Inc. v. Ramesh Pitamber & Kusum Pitamber, et al., No. 17-61, D. Neb.).
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June 10, 2019
Judge Dismisses Flood Coverage Suit After Parties Announce Confidential Settlement
SAN FRANCISCO — A California federal judge on May 29 signed an order dismissing with prejudice insureds’ lawsuit arising from flood damage one day after the insureds and their insurer announced that they reached a confidential settlement following mediation (Alicia Martin v. CSAA Insurance Exchange, et al., No. 17-04066, N.D. Calif.).
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June 10, 2019
Insured Seeks To Halt Insurer’s Dismissal Bid In Bad Faith Suit
ALBUQUERQUE, N.M. — An insured has sufficiently pleaded her claim for bad faith against her automobile insurance provider, and a judge should reject the insurer’s argument that the claim must fail because it presupposes that insurers breached their policy by not paying the insured’s underinsured motorist bodily injury claim, the insured argues in a May 20 opposition brief filed in New Mexico federal court (Yvonne Apodaca v. Young America Insurance Co., et al., No. 18-399, D. N.M.).