Mealey's Catastrophic Loss : Mealey's : Legal News & Analysis

Mealey's Catastrophic Loss

February 01, 2024
Breach Of Contract, Bad Faith Claims In Hurricane Damages Suit Fail, Judge Says

NEW ORLEANS — A Louisiana federal judge granted a homeowners insurer’s motion to dismiss an insured’s breach of contract and bad faith claims without prejudice to amend the complaint after determining that the insured fails to allege sufficient facts in support of the claims stemming from the insurer’s adjustment of a hurricane damages claim.
February 01, 2024
Federal Judge Tosses Hurricane Coverage Case After Suspending Homeowner’s Counsel

LAFAYETTE, La. — A Louisiana federal judge adopted a magistrate judge’s report and recommendation to dismiss for failure to prosecute after a homeowner failed to attend a status conference in her hurricane coverage suit against her now-insolvent insurer following the judge’s termination of her legal counsel.
January 25, 2024
N.J. High Court: Casino Fails To Allege ‘Direct Physical Loss’ In COVID-19 Suit

TRENTON, N.J. — The New Jersey Supreme Court on Jan. 24 affirmed an appeals panel’s finding that a lower court erred in denying insurers’ motion to dismiss an insured’s lawsuit seeking property and business interruption insurance coverage for its alleged loss of income during the closure of its Atlantic City casino in response to COVID-19 pandemic shutdown orders, finding that the insured has failed to plead that its business losses were caused by direct physical loss or damage under the policy and that the contamination exclusion further bars coverage.
January 24, 2024
9th Circuit Panel Majority Reverses Ruling On Pollution Exclusion’s Applicability

SAN FRANCISCO — The majority of the Ninth Circuit U.S. Court of Appeals on Jan. 23 reversed a district court’s ruling that a pollution exclusion bars coverage for an underlying toxic exposure suit stemming from the cleanup of wildfire debris after determining that a potential for coverage exists because the mechanism of exposure does not clearly constitute an event that is commonly thought of as pollution event pursuant to California precedent.
January 23, 2024
Homeowner Sues Insurer, Guaranty Association, Seeks Coverage For Hurricane Damage

JACKSONVILLE, Fla. — A Florida homeowner sued his now-insolvent insurer and the Florida Insurance Guaranty Association (FIGA) in a Florida state court, asserting claims for breach of contract and violations of Florida law for failure to adequately cover purported losses related to Hurricane Ian.
January 23, 2024
Judge OKs Adding Guaranty Association In Bad Faith Suit Against Insolvent Insurer

NEW ORLEANS — A Louisiana federal judge granted a homeowner’s motion to file an amended complaint to add as a defendant the Louisiana Insurance Guaranty Association (LIGA) in a breach of contract and bad faith suit against a now-insolvent homeowners insurer over its purported failure to adequately cover damage caused by Hurricane Ida, finding that amending the complaint is necessary due to the insurer’s insolvency and that the case must be remanded because complete diversity is destroyed.
January 22, 2024
Insurer Asks 5th Circuit To Reconsider Affirmation Of $502,172 Bad Faith Judgment

NEW ORLEANS — An insurer on Jan. 19 asked the Fifth Circuit U.S. Court of Appeals to reconsider its ruling that there was no reversible error in a jury’s conclusion that it acted in bad faith and underpaid its church insured for property damage that was caused by Hurricane Laura, challenging the panel’s ruling that affirmed the trial court’s $502,172.16 award in favor of the insured for damages, penalties and fees.
January 22, 2024
Insureds Failed To Show Valid Basis For N.C. High Court Review, Insurer Argues

RALEIGH, N.C. — An insurer argued to the North Carolina Supreme Court that an appeals court’s ruling that affirmed a lower court’s dismissal of a clothing retailer insured’s lawsuit seeking coverage for its losses arising from the coronavirus pandemic “presents no precedent-setting error that warrants intervention” by the North Carolina Supreme Court.
January 22, 2024
Bad Faith Claim Against Guaranty Association Dismissed In Hurricane Coverage Row

NEW ORLEANS — A Louisiana federal judge granted partial dismissal to the Louisiana Insurance Guaranty Association (LIGA), which was substituted for an insolvent homeowners insurer, in a breach of contract suit over damages from Hurricane Ida, finding that the claims for bad faith, mental anguish, penalties, pre-insolvency costs and interest must be dismissed because they are not covered claims for which “LIGA is the statutory successor.”
January 19, 2024
Court Ignored Ordinary Meaning Of Physical Loss, Insureds Tell N.C. High Court

RALEIGH, N.C. — Restaurant insureds tell the North Carolina Supreme Court that it should reverse an appeals court’s reversal of a lower court’s grant of partial summary judgment in their favor in a coronavirus coverage dispute, arguing that the phrase “physical loss or physical damage” includes loss of the physical use of property under the state’s “long-standing principles of insurance contract interpretation.”
January 19, 2024
Washington Majority Affirms Rulings Against Insurers In Coronavirus Coverage Suit

OLYMPIA, Wash. — A majority of the Washington Supreme Court on Jan. 18 affirmed a lower court’s denial of insurers’ motion to dismiss based on forum non conveniens in a coverage dispute with 60 colleges arising from the COVID-19 pandemic, further affirming the lower court’s issuance of an interstate antisuit injunction enjoining the insurers from taking further action in a parallel Illinois lawsuit.
January 16, 2024
City’s Cross-Complaints Are Not Prohibited, California Panel Rules In Reversal

SAN DIEGO — A California appeals panel held that a lower court erred in ruling that the city of Riverside’s cross-complaints in a dispute arising from a fire were prohibited as a matter of law, remanding with directions for the lower court to vacate its orders sustaining an insurer’s demurrers to the city's cross-complaints without leave to amend and enter new orders sustaining the demurrers with leave to amend.
January 11, 2024
Hospital States Claim Under Health Care Endorsement, 1st Circuit Rules In Reversal

BOSTON — The First Circuit U.S. Court of Appeals ruled Jan. 10 that a hospital insured was subject to decontamination orders and, therefore, states a claim for “Disease Contamination Coverage” under its commercial property insurance policy’s Health Care Endorsement, reversing in part a federal court’s breach of contract lawsuit seeking coverage for its losses arising from the coronavirus pandemic.
January 11, 2024
Florida Panel Affirms Ruling, Certifies Conflict In Hurricane Irma Coverage Suit

MIAMI — A Florida appeals panel held that a lower court properly determined that insureds breached their insurance policy's prompt notice provision and correctly applied the presumption of prejudice in a Hurricane Irma coverage dispute, certifying conflict with Perez v. Citizens Property Insurance Corporation, which concluded that the language in an insurance policy’s “Duties after Loss” provision of “upends the presumption” and placed “the initial burden on” the insurer to show that it was prejudiced.
January 11, 2024
California Panel Denies NHL Insureds’ Petition For Review In COVID-19 Coverage Suit

SAN JOSE, Calif. — A California appeals panel denied a petition by the National Hockey League (NHL) and 19 league clubs seeking review of a lower court’s ruling in a coverage dispute for their losses resulting from the coronavirus pandemic, finding that the contamination exclusion barred coverage.
January 11, 2024
Alabama High Court Dismisses Insurer’s Appeal In Hurricane Sally Coverage Dispute

MONTGOMERY, Ala. — The Alabama Supreme Court dismissed a commercial property insurer’s appeal of a lower court’s order denying its motion to invoke the policy’s appraisal procedure in a Hurricane Sally coverage dispute, finding that there are outstanding coverage issues that would not be resolved by the appraisal process.
January 11, 2024
Judge: University’s Claims Forge At Least 1 Path To Coverage In Coronavirus Suit

SEATTLE — A Washington judge denied an insurer’s motion to dismiss the University of Washington’s lawsuit seeking coverage for losses allegedly incurred by its medical and athletic properties in the wake of the coronavirus pandemic, finding that the time element losses endorsement may establish coverage based on the insured’s alleged facts.
January 10, 2024
Louisiana Majority Refuses To Review Coverage Suit Over Hurricanes Laura, Delta

NEW ORLEANS — A majority of the Louisiana Supreme Court on Jan. 10 denied an insurer’s petition for a writ of certiorari seeking review of lower court’s rulings following a jury verdict in favor of insureds in a coverage dispute arising from Hurricanes Laura and Delta damage.
January 09, 2024
11th Circuit Denies Insurer’s Petition For Panel Rehearing In Hurricane Irma Suit

ATLANTA —The 11th Circuit U.S. Court of Appeals in a one-page order denied an insurer’s petition for panel rehearing in an appraisal dispute over Hurricane Irma damage.
January 09, 2024
Panel Affirms $502,172 Bad Faith Judgment Against Insurer In Hurricane Laura Suit

NEW ORLEANS — The Fifth Circuit U.S. Court of Appeals found no reversible error in a jury’s conclusion that an insurer acted in bad faith and underpaid its church insured for property damage that was caused by Hurricane Laura, affirming the trial court’s $502,172.16 award in favor of the insured for damages, penalties and fees.
January 09, 2024
Washington Panel Affirms Stay Of Subcontractor’s Pass-Through Coronavirus Claim

SEATTLE — A Washington appeals court panel on Jan. 8 held that a lower court did not abuse its discretion by staying a subcontractor’s pass-through coronavirus-related claim in its lawsuit against the port of Seattle, a prime contractor and their sureties pending final resolution of the prime contractor’s suit against the port, finding that the plain language of the subcontract explicitly waives the subcontractor’s right to sue under Washington’s Little Miller Act.
January 08, 2024
Magistrate: Summary Judgment Not ‘Ideal Vehicle’ For Insurer’s Damages Argument

FORT MYERS, Fla. —A federal magistrate judge in Florida on Jan. 5 denied an insurer’s motion for partial summary judgment in a condominium insured’s bad faith lawsuit seeking coverage for property damage caused by Hurricane Irma, finding that “summary judgment is not the ideal vehicle” for addressing the insurer’s arguments against the insured’s claim for damages.
January 08, 2024
New Jersey Panel Affirms Dismissal Of Wawa’s Coronavirus Coverage Dispute

TRENTON, N.J. — A New Jersey appeals court panel on Jan. 5 affirmed a lower court’s ruling dismissing with prejudice Wawa Inc.’s first amended complaint seeking coverage for its losses arising from the COVID-19 pandemic, finding that the court’s holdings and reasonings in Mac Prop. Grp., LLC v. Selective Fire & Cas. Ins. Co. apply to Wawa's commercial liability insurance policies and, therefore, no coverage is owed.
January 08, 2024
Insured Fails To Support Breach Of Contract, Bad Faith Claims, Federal Judge Says

NEW ORLEANS — A Louisiana federal judge dismissed an insured’s breach of contract and bad faith claims against his homeowners insurer after determining that the insured failed to provide sufficient facts showing that the insurer breached its contract and acted in bad faith in its adjustment of the insured’s claim for damages caused by Hurricane Ida.
January 05, 2024
Clothing Retailer Asks North Carolina High Court To Review COVID-19 Coverage Suit

RALEIGH, N.C. — A clothing retailer insured petitioned the North Carolina Supreme Court to review an appeals court’s ruling that affirmed a lower court’s dismissal of its lawsuit seeking coverage for its losses arising from the coronavirus pandemic, challenging the lower courts’ reliance on North State Deli v. Cincinnati Ins. Co. in dismissing its case.