Mealey's Insurance Bad Faith

  • September 17, 2020

    Breach Of Contract Claim Split From Bad Faith Claim In Insurance Coverage Suit

    MILWAUKEE — A federal judge in Wisconsin on Sept. 8 granted an insurer's motion to bifurcate and stay an insurance bad faith claim in an insurance coverage dispute stemming from hailstorm damage to a condominium complex, ruling that such action is warranted to promote judicial economy (Sherman Creek Condominiums Inc. v. Mid-Century Insurance Co., No. 19-1735, E.D. Wis., 2020 U.S. Dist. LEXIS 163377).

  • September 17, 2020

    Bad Faith Claim To Proceed In Property Damage Dispute, Federal Judge Says

    DALLAS — An insured's bad faith claim arising out of a property insurer's denial of additional coverage for storm damages can proceed because the insured presented sufficient facts to support his claim, a Texas federal judge said Sept. 3 (James Singer v. State Farm Lloyds, No. 19-1672, N.D. Texas, 2020 U.S. Dist. LEXIS 161188).

  • September 17, 2020

    Bad Faith Claim Against Auto Insurer Dismissed; Amendment Permitted

    LAS VEGAS — A Nevada federal judge on Sept. 3 granted an auto insurer's motion to dismiss an insured's bad faith claim with leave to amend after determining that the insured failed to show that the insurer's settlement offer for underinsured motorist benefits was unreasonable (Michael Jacobs v. GEICO General Insurance Co., No. 19-1934, D. Nev., 2020 U.S. Dist. LEXIS 161776).

  • September 17, 2020

    Insured Failed To Show Auto Insurer's Claim Denial Was Not Reasonable

    LAS VEGAS — An insured's claim for tortious breach of the implied covenant of good faith and fair dealing must be dismissed with leave to amend because the insured failed to offer sufficient facts showing that her auto insurer's denial of her claim for underinsured motorist benefits was not reasonable, a Nevada federal judge said Sept. 3 (Nancy Diec v. GEICO Casualty Co., No. 20-122, D. Nev., 2020 U.S. Dist. LEXIS 161756).

  • September 17, 2020

    Fact Issue Exists As To Whether Auto Insurer's Issuance Of 1 Check Was Reasonable

    DENVER — A Colorado federal judge on Sept. 15 determined than an insured's claims for breach of contract and bad faith arising out of an auto insurer's decision to issue one check for uninsured motorist benefits to the divorced parents of a 5-year-old boy who died in a car accident can proceed because issues of fact exist as to whether the insurer's decision to issue one check requiring the endorsements of both parents was reasonable (Raymond Robles v. American Family Mutual Insurance Co., No. 19-1748, D. Col., 2020 U.S. Dist. LEXIS 168477).

  • September 16, 2020

    Insured Awarded $2.5M In Prefiling Prejudgment Interest In Knee Implant Dispute

    KALAMAZOO, Mich. — A Michigan federal judge on Sept. 15 awarded an insured almost $2.5 million in prefiling prejudgment interest because the insured's bad faith claim arising out of the settlement of underlying claims based on the insured's sale of defective artificial knee joints was founded in contract and, therefore, permitted under Michigan law (Stryker Corp., et. al. v. XL Insurance America Inc., No. 17-66, W.D. Mich.).

  • September 16, 2020

    Judge Dismisses All Claims In Retailer's Suit Seeking Coverage For COVID-19 Losses

    SAN FRANCISCO — A federal judge in California on Sept. 14 dismissed without prejudice all claims in a retailer insured's class complaint against its insurer, finding that the insured is not entitled to business income, extra expense or civil authority coverage as a matter of law for its claimed losses following the state's "Stay at Home" order in response to the novel coronavirus pandemic, granting the insured leave to amend because the law regarding "business interruption coverage linked to the COVID-19 pandemic is very much in development" (Mudpie, Inc. v. Travelers Casualty Insurance Company of America, No. 20-03213, N.D. Calif.).

  • September 15, 2020

    Auto Insurer's Denial Of Additional Benefits Was Not Unreasonable, Panel Says

    HARRISBURG, Pa. — A Pennsylvania trial court did not err in finding that a bad faith claim against an auto insurer cannot proceed because the insureds failed to provide evidence that the insurer's failure to pay additional underinsured motorist benefits was unreasonable, a panel of the Pennsylvania Superior Court said Sept. 11 (Kevin Beach, et al. v. The Navigators Insurance Co., No. 1550 MDA 2019, Pa. Super., 2020 Pa. Super. Unpub. LEXIS 2886).

  • September 15, 2020

    No Coverage Owed To Additional Insured For Underlying Negligence Suit

    PHILADELPHIA — A Pennsylvania federal judge on Sept. 15 granted summary judgment in favor of an insurer after determining that no coverage is owed to an additional insured seeking coverage for an underlying personal injury suit and that the insurer did not act in bad faith in denying the claim (Eastern LLC v. Travelers Casualty Insurance Company of America, No. 19-5283, E.D. Pa., 2020 U.S. Dist. LEXIS 168104).

  • September 15, 2020

    Bifurcation Of Bad Faith, Contract Claims Not Warranted In Auto Dispute

    TACOMA, Wash. — Bifurcation of an insured's bad faith and tort claims from the insured's contract claims in an auto coverage dispute is not warranted because bifurcation would ultimately result in a delay of the resolution of the case, a Washington federal judge said Sept. 10 (Katelyn J. Griffin v. Allstate Insurance Co., No. 20-5540, W.D. Wash., 2020 U.S. Dist. LEXIS 165521).

  • September 14, 2020

    State Law Claims Alleged Against Employer, Disability Insurer Are Preempted

    ALEXANDRIA, La. — An occupational therapist seeking to recover disability benefits under a plan issued by her employer cannot allege state law claims for bad faith, breach of contract and detrimental reliance against her employer and disability insurer because the claims are preempted by the Employee Retirement Income Security Act, a Louisiana federal judge said Sept. 10 in dismissing the state law claims (Melanie Lewellyan v. Red River Rehab LLC, et al., No. 19-1105, W.D. La., 2020 U.S. Dist. LEXIS 166859).

  • September 11, 2020

    Federal Judge Denies Remand Of Homeowners' Breach Of Contract, Bad Faith Suit

    FRESNO, Calif. — A California federal judge on Sept. 8 denied an insured's motion to remand a breach of contract and bad faith suit arising out of fire damages to an insured home after determining that it was not initially clear that the insured's damages exceeded the federal jurisdictional minimum amount of $75,000 (Ramon Sanchez v. AMCO Insurance Co., et al., No. 19-1633, E.D. Calif., 2020 U.S. Dist. LEXIS 163761).

  • September 10, 2020

    Insured Says Property Insurer Breached Contract By Failing To Cover All Water Damages

    NEW YORK — An insurer breached its contract and breached the implied covenant of good faith and fair dealing by refusing to pay more than $2 million in additional coverage for water damages sustained by an insured business, an insured contends in a Sept. 8 complaint filed in a New York court (408 W. 15 Members LLC et al., v. Mt. Hawley Insurance Co. et al., No. n/a, N.Y. Sup., N.Y. Co.).

  • September 10, 2020

    Breach Of Contract, Bad Faith Counterclaims Filed Against Insolvent Insurer

    ELIZABETH CITY, N.C. — Parties to a loan and security agreement on Sept. 4 filed counterclaims against an insurer, which is in rehabilitation, for breach of contract, bad faith and breach of fiduciary duty in a North Carolina federal court case over the insurer's efforts to recover $45,675,960 under the agreement based upon a borrower's default  (Colorado Bankers Life Insurance Company v. Summerville Asset Management, LLC, et al., No. 20-432, E.D. N.C.).

  • September 09, 2020

    Plaintiff Voluntarily Dismisses Class Action Seeking Coverage For Trip Cancellation

    LOS ANGELES — A Los Angeles resident on Aug. 19 filed a notice of voluntary dismissal without prejudice of his class action complaint alleging in a California federal court that an insurance policy specifically covered his trip cancellation due to California’s civil authority orders in response to the novel coronavirus pandemic (Richard Robbins v. Generali Global Assistance, Inc., et al., No. 20-04904, C.D. Calif.).

  • September 08, 2020

    Insurer's Claim Investigation Handling Was Not In Bad Faith, Panel Rules

    ATLANTA — A federal district court did not err in granting summary judgment in an insurance bad faith lawsuit stemming from an automobile accident that caused the death of a claimant because no reasonable jury could determine that the insurer "unreasonably exposed its insured to a judgment in excess of his policy limits," an 11th Circuit U.S. Court of Appeals panel ruled Aug. 28 (Nya Yanitza Montanez v. Liberty Mutual Fire Insurance Co., No. 18-80788, 11th Cir., 2020 U.S. App. LEXIS 27449).

  • September 04, 2020

    Insurers: COVID-19-Related Business Loss Claims Preempted By Policy Exclusions

    LOS ANGELES — Insurers named as defendants in a breach of contract and bad faith lawsuit stemming from their denial of a lost business coverage claim filed by the operator of a nail salon that was forced to close during the novel coronavirus pandemic on Aug. 28 asked a federal judge in California to dismiss their insured's complaint, arguing that the insured failed to plead any basis for coverage under the terms of the policy he purchased (Thomas Phan v. Nationwide General Insurance Co., et al., No. 20-7616, C.D. Calif.).

  • September 04, 2020

    Panel Reverses Ruling In Insurer's Favor In Bad Faith Suit Over Hurricane Irma Damage

    LAKELAND, Fla. — A Florida appeals panel on Sept. 4 held that a homeowners insurer's invocation of an appraisal under the policy and subsequent payment of the appraisal award after the expiration of the statutory cure period did not, as a matter of law, cure the insurer's alleged violation of failing to attempt to settle the insureds' Hurricane Irma property damage claim in good faith, reversing a lower court and remanding for further proceedings so the insureds can pursue their bad faith action (Patti Fortune, et al. v. First Protective Insurance Company, No. 2D19-2209, Fla. App., 2nd Dist., 2020 Fla. App. LEXIS 12540).

  • September 03, 2020

    Homeowner Failed To Prove Insurer Acted In Bad Faith In Denying Fire Loss Claim

    DAYTON, Ohio — An Ohio federal judge on Sept. 1 granted a homeowners insurer's motion for summary judgment on a bad faith claim because no reasonable juror could find that the insurer's denial of coverage for a fire loss claim was unreasonable (Charles A. Waldren v. Allstate Vehicle and Property Insurance Co., et al., No. 18-290, S.D. Ohio, 2020 U.S. Dist. LEXIS 159161).

  • September 03, 2020

    Bad Faith Claim In Auto Dispute To Proceed, Nevada Federal Judge Determines

    LAS VEGAS — An insured's bad faith claim alleged against an auto insurer will proceed because the insured presents sufficient facts in support of the claim, a Nevada federal judge said Aug. 31 in partially denying the insurer's motion to dismiss (Andrew Davies v. Government Employees Insurance Co., No. 19-1987, D. Nev., 2020 U.S. Dist. LEXIS 158125).