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Mealey's Insurance Bad Faith

  • September 26, 2018

    Insurer Says Breach Of Policy Claims Do Not Arise Out Of Activities In New York

    NEW YORK — In seeking to dismiss a New York federal court case alleging breach of policies by unlawful increase of premium costs to recoup costs associated with an acquisition, a life insurer argues on Sept. 21 that the plaintiffs’ claims do not arise out of specific business activities in New York (Derek Fan, et al. v. Phoenix Life Insurance Co., et al., No. 18-01288, S.D. N.Y.).

  • September 25, 2018

    Florida High Court Majority Reinstates $9.2M Bad Faith Verdict Against Insurer

    TALLAHASSEE, Fla. — The majority of the Florida Supreme Court on Sept. 20 reinstated a $9.2 million bad faith verdict entered against an auto insurer after determining that the appeals court erred in finding that the evidence presented at trial was insufficient to prove the insurer acted in bad faith and that the appeals court improperly applied Florida bad faith precedent (Suzanne Harvey, et al. v. GEICO General Insurance Co., No. SC17-85, Fla. Sup., 2018 Fla. LEXIS 1705). 

  • September 24, 2018

    Federal Judge Substantially Denies Dismissal Of Claims In Bad Faith Lawsuit

    SCRANTON, Pa. — The “factual detail” contained in an insured’s insurance bad faith lawsuit against his homeowners insurance provider is sufficient when viewed holistically to survive a motion to dismiss, a federal judge in Pennsylvania ruled Sept. 20 in denying the motion (Eric Stewart v. Travelers Insurance Co., No. 18-170, M.D. Pa., 2018 U.S. Dist. LEXIS 161125).

  • September 24, 2018

    Counterclaims In Bad Faith Suit Dismissed For Failure To Create Tort Liability

    ABINGDON, Va. — A federal judge in Virginia on Sept. 14 ruled that an insured’s counterclaims for conversion, breach of the implied covenant of good faith and fair dealing, fraud and intentional misrepresentation failed to create any tort liability on the part of an insurer that denied the insured’s request for coverage under the terms of a commercial insurance policy (American Fire & Casualty Co. v. Raleigh Mine & Industrial Supply Inc., et al., No. 18-0008, W.D. Va., 2018 U.S. Dist. LEXIS 156792).

  • September 21, 2018

    Suit Alleging Auto Insurer Undervalued Total Loss Vehicles Will Move Forward

    SAN FRANCISCO — An insureds’ claims for breach of contract, bad faith, misrepresentation and fraud against an auto insurer accused of undervaluing vehicles that were rendered a total loss will move forward against the insurer because the insured offered sufficient facts to support the claims, a California federal judge said Sept. 19 (Bobby Jones, et al. v. Progressive Casualty Insurance Co., et al., No. 16-6941, N.D. Calif., 2018 U.S. Dist. LEXIS 160313).

  • September 21, 2018

    Maryland Panel Affirms Dismissal Of Bad Faith Claim, Reverses On Negligence Claim

    ANNAPOLIS, Md. — The Maryland Court of Special Appeals on Sept. 18 affirmed a trial court’s dismissal of breach of contract and bad faith claims because the insured, who is seeking coverage for damages caused by an overflow of sewage in his home, failed to exhaust all remedies under Maryland law before filing suit against the insurer (Kevin C. Betskoff v. Standard Guaranty Insurance Co., No. 1444, Md. Spec. App., 2018 Md. App. LEXIS 877).

  • September 21, 2018

    South Dakota Federal Judge Dismisses Suit Against Long-Term Care Insurer

    SIOUX FALLS, S.D. — A South Dakota federal judge on Sept. 19 dismissed an insured’s suit alleging breach of contract, bad faith and misrepresentation against a long-term care insurer after agreeing with a magistrate judge that the insured failed to prove that a facility in which she resided was an assisted living facility entitling her to benefits under the policy (Leona Van Dusseldorp v. Continental Casualty Co., et al., No. 16-5073, D. S.D., 2018 U.S. Dist. LEXIS 159674).

  • September 21, 2018

    Ohio Panel Overturns Summary Judgment Ruling In Insurance Bad Faith Case

    MIDDLETOWN, Ohio — A trial court abused its discretion in denying an insured’s request to allow discovery in an insurance breach of contract and bad faith lawsuit before granting an insurer’s motion for summary judgment because the trial court’s prior stay of discovery precluded the insured from being able to conduct and obtain any discovery in defense of the motion, an Ohio appellate panel ruled Sept. 10 in reversing and remanding (Crane Service & Inspections LLC v. Cincinnati Specialty Underwriters Insurance Co., No. CA2018-01-003, Ohio App., 12th Dist., 2018 Ohio App. LEXIS 3930).

  • September 20, 2018

    No Issues Of Fact Exist As To Whether Investigation Was Reasonable, Panel Says

    SEATTLE — The Ninth Circuit U.S. Court of Appeals on Sept. 18 affirmed a district court’s dismissal of an insured’s extracontractual claims after determining that the insured failed to raise a genuine issue of material dispute regarding the reasonableness of the insurer’s investigation of the insured’s vandalism claim (Mary Ann Bernadette Kerrigan v. QBE Insurance Corp., No. 18-35019, 9th Cir., 2018 U.S. App. LEXIS 26460).

  • September 20, 2018

    Summary Judgment Ruling In Bad Faith Suit Affirmed By Arizona Appellate Panel

    TUCSON, Ariz. — An Arizona appellate panel on Sept. 7 ruled that a state trial court did not err in granting an insurer’s summary judgment motion in an insurance breach of contract and bad faith lawsuit because the third party lacked any contractual “special relationship” with the insurer as required by state law (James Mathis v. Allstate Insurance Co., No. 2 CA-CV 2018-0048, Ariz. App., Div. 2, 2018 Ariz. App. Unpub. LEXIS 1334).

  • September 19, 2018

    Georgia Panel Affirms Claim Untimely; No Bad Faith On Insurer’s Part

    ATLANTA — A Georgia appeals panel on Sept. 18 affirmed a lower court’s grant of summary judgment in favor of a business liability insurer, finding that the plaintiff failed to provide timely notice of a coverage claim and that the insurer had reasonable grounds for denying the claim (Taylor, et al. v. State Farm Fire & Casualty Co., No. A18A1398, Ga. App., 3rd Div., 2018 Ga. App. LEXIS 513).

  • September 19, 2018

    Magistrate Judge Bifurcates Bad Faith Claim In Property Damage Coverage Dispute

    PADUCAH, Ky. — Bifurcating a bad faith claim from a breach of contract claim in a property damage coverage dispute is warranted because the bad faith claim is contingent on the outcome of the breach of contract claim, a Kentucky federal judge said Sept. 18 in granting the insurer’s motion to bifurcate (J. Richard Walker, et al. v. Seneca Insurance Co., No. 18-77, W.D. Ky., 2018 U.S. Dist. LEXIS 158600).

  • September 19, 2018

    Judge Dismisses Insureds’ Bad Faith Claim, Allows Breach Of Contract To Remain

    HARTFORD, Conn. — A Connecticut federal judge on Sept. 17 dismissed claims for bad faith and declaratory judgment against an insurer regarding its refusal to pay for damages to basement walls; however, the insureds’ breach of contract claim survived (James T. Ainsworth, et al. v. Amica Mutual Insurance Co., No. 16-01139, D. Conn., 2018 U.S. Dist. LEXIS 157886).

  • September 17, 2018

    Insurer Owed Duty To Defend Insured Against Environmental Claims

    BOSTON — A Massachusetts federal judge on Sept. 13 adopted a magistrate judge’s recommendation to grant a motion for summary judgment filed by the insured’s assignee in an environmental contamination coverage dispute after determining that the magistrate judge’s analysis regarding the policy’s sudden and accidental exception to the pollution exclusion was correct (Plaistow Project LLC v. Ace Property & Casualty Insurance Co., No. 16-11385, D. Mass., 2018 U.S. Dist. LEXIS 155965).

  • September 14, 2018

    Insured’s Extracontractual Claims Cannot Survive, Nevada Federal Judge Says

    LAS VEGAS — An insured’s claims for bad faith and violation of Nevada’s Unfair Claims Practices Act must be dismissed because the insured failed to support his position that the insurer unreasonably denied his claim for underinsured motorist (UIM) benefits, a Nevada federal judge said Sept. 11 in granting the insurer’s motion for summary judgment (Wayne Yoshimoto v. Safeco Insurance Company of Illinois, No. 17-382, D. Nev., 2018 U.S. Dist. LEXIS 154870).

  • September 14, 2018

    No Attorney Fees To Insured Who Prevailed On Bad Faith Claim, Panel Affirms

    PHILADELPHIA — A district court did not abuse its discretion in denying a plaintiff’s motion for attorney fees following a jury verdict in favor of the plaintiff on his bad faith claim because the fees requested were “outrageously excessive” and the district court had the discretion to deny the motion in its entirety, the Third Circuit U.S. Court of Appeals said Sept. 12 (Bernie Clemens, et al. v. New York Central Mutual Fire Insurance Co., No. 17-3150, 3rd Cir., 2018 U.S. App. LEXIS 25803).

  • September 14, 2018

    Coverage Barred For Water Damage; Loss Was Not Sudden And Accidental

    DENVER — No coverage is owed for water damage discovered within an exterior insulation finishing system because the damage was not sudden and accidental as required for coverage to exist under the policy, a Colorado federal magistrate judge said Sept. 13 (Mark Mock, et al. v. Allstate Insurance Co., No. 17-2592, D. Colo., 2018 U.S. Dist. LEXIS 156256).

  • September 12, 2018

    Judge: Water Exclusion Bars Coverage For Insureds’ Damages From Wall Collapse

    SEATTLE — Coverage for damages caused by the collapse of a home’s retaining wall are precluded under a homeowners insurance policy’s water exclusion, a Washington federal judge ruled Sept. 7; however, the judge declined to grant summary judgment to the insurer on claims for bad faith and violation of Washington’s Consumer Protection Act (CPA) (Stephen Jones, et al. v. State Farm Fire and Casualty Co., No. 17-1058, W.D. Wash., 2018 U.S. Dist. LEXIS 153102).

  • September 12, 2018

    Bad Faith Claim Against Disability Income Insurer Is Premature, Judge Says

    TAMPA, Fla. — A Florida federal judge on Sept. 11 dismissed an insured’s bad faith claim without prejudice after determining that the claim arising out of a disability income insurer’s termination of benefits is premature (Susan Welsh v. General American Life Insurance Co., No. 18-1227, M.D. Fla., 2018 U.S. Dist. LEXIS 154487).

  • September 12, 2018

    Joint Defense Agreement Deemed Not Discoverable In Insurance Bad Faith Suit

    DETROIT — A joint defense agreement (JDA) between three defendants in an insurance coverage lawsuit is not relevant to their bad faith counterclaim and contains only boilerplate language, a Michigan federal magistrate ruled Sept. 6, denying the insurer’s motion to compel the agreement (Wausau Underwriters Insurance Co. v. Reliable Transportation Specialists Inc., et al., No. 2:15-cv-12954, E.D. Mich., 2018 U.S. Dist. LEXIS 151745).