NEW ORLEANS — A homeowners insurer owes no coverage for the collapse of a home’s joists as a result of termite and rot damage because there was no entire collapse of the home as required by the policy, the Fifth Circuit U.S. Court of Appeals said May 13 in affirming a district court’s ruling in favor of the insurer.
SIOUX FALLS, S.D. — A South Dakota federal judge on May 12 denied a workers’ compensation insurer’s motion for summary judgment on a bad faith claim after determining that the insured demonstrated that questions of fact exist as to whether the insurer’s denial of benefits was reasonable.
DOVER, Del. — A Delaware state court judge on April 28 denied an insurer’s motion for summary judgment in a workers’ compensation insurance dispute, ruling that genuine issues of material fact exist as to whether the insurer acted in bad faith, and if so, whether the insurer acted with “reckless indifference” toward its insured’s rights.
SAN FRANCISCO — In a May 5 order, a federal judge in California dismissed with prejudice insurance breach of contract and bad faith claims brought by claimants against a commercial property insurer, ruling that the claimants have failed to sufficiently state their breach of contract claim and that, as such, cannot plausibly state a bad faith claim in arguing that the insurer failed to pay policy benefits stemming from a water damage claim.
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.
WEST PALM BEACH, Fla. — A Florida federal judge on April 30 determined that an auto insurer did not act in bad faith by failing to settle a third-party insurance claim because the auto insurer acted reasonably from the moment it learned of the claim against its insured.
PHILADELPHIA — An insurer’s delay in paying the full amount of an insured’s loss under a property and casualty insurance policy was not unreasonable, a Pennsylvania federal judge said May 5 in granting the insurer’s motion for summary judgment on the insured’s bad faith claim.
FORT MYERS, Fla. — A federal judge in Florida in April 27 denied an insurer’s motion to dismiss an insured’s bad faith lawsuit seeking coverage for Hurricane Irma damage, finding that the allegations and attached exhibits give enough facts to assert a plausible bad faith claim.
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.
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.
NEWARK, N.J. — A New Jersey federal judge on April 29 determined that a magistrate judge properly denied a motion to amend a complaint filed by insureds in a breach of contract and bad faith lawsuit against a professional liability insurer and agreed with the magistrate judge that the insureds failed to show that there was good cause for failing to amend the complaint before the court-imposed scheduling deadline for amended pleadings.
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.
KANSAS CITY, Mo. — An insurer breached the terms of a property insurance policy and acted in bad faith by failing to properly investigate and pay damages under the policy to a church that sustained damage to its roof in a hail and windstorm, the church alleges in a April 27 complaint filed in Missouri federal court.
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.
CHICAGO — An Illinois federal judge on April 26 determined that an insured’s breach of contract, fraud and fraudulent omission claims alleged against a long-term care insurer arising out of the insurer’s allegedly inconsistent premium increases can proceed; however, the judge said the insured’s bad faith and deceptive business practices claims must be dismissed.
CHICAGO — A dental provider insured on April 6 asked the Seventh Circuit U.S. Court of Appeals to reverse a lower federal court’s ruling that it failed to allege a “direct physical loss” to trigger coverage for its financial losses as a result of the novel coronavirus closure orders, arguing that, in response to the SARS virus, “the greater insurance industry has admitted, over a decade ago, that nearly identical policies did cover viruses.”
SEATTLE — A Ninth Circuit U.S. Court of Appeals panel on April 21 dismissed a couple’s appeal of rulings awarding summary judgment to an insurer on their counterclaims for breach of contract and violation of the Washington Insurance Fair Conduct Act, finding that the judge did not meaningfully participate in the subsequent dismissal without prejudice of the couple’s remaining claims for bad faith and violation of the Washington Consumer Protection Act (CPA) when the parties agreed to settle the suit.
HOUSTON — A federal judge in Texas on April 8 dismissed an insured’s claims against his long-term disability insurer stemming from the insurer’s denial of benefits, ruling that the insured failed to sufficiently plead the necessary elements of his breach of contract claim.
SAN DIEGO — A California federal judge on April 21 determined that an insured’s breach of contract and bad faith claims against a homeowners insurer can proceed in a water damage coverage dispute because a question of fact exists as to whether the damage is covered under the homeowners policy.
ST. LOUIS — An Eighth Circuit U.S. Court of Appeals panel on April 21 vacated a ruling awarding summary judgment to an insurer that refused to defend and indemnify a general contractor, finding that the contractor was an additional insured under a policy the company issued to a cement subcontractor and that the insurer did not have a reasonable basis to justify its refusal.