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

Mealey's Catastrophic Loss

August 28, 2023
Insurers Tell 5th Circuit $7M Hurricane Ida Dispute Belongs In Arbitration

NEW ORLEANS — A group of foreign and domestic insurers tells the Fifth Circuit U.S. Court of Appeals in an appellee brief that it should affirm a Louisiana federal court’s ruling compelling arbitration of property owners’ claims for $7 million in damages caused by Hurricane Ida and for bad faith, writing that the arbitration is required under the insureds’ policies and the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the Convention).
August 24, 2023
Bad Faith Claim Against Homeowners Insurer Fails, Louisiana Federal Judge Says

SHREVEPORT, La. — A bad faith claim against a homeowners insurer cannot proceed because the insureds failed to meet their burden of showing that the insurer acted arbitrarily and capriciously in handling their claim for damages sustained to their home by hail, a Louisiana federal judge said in granting the insurer’s motion for partial summary judgment.
August 23, 2023
Homeowner Seeks Video Conference In Hail Damage Suit Against Insolvent Insurer

GALVESTON, Texas — A Texas homeowner filed a motion in Texas state court asking for a scheduled status conference to be held via video in his breach of contract suit against a now-insolvent insurer over its purported failure to cover hail damage, asserting that remote conferencing would be appropriate due to the “unnecessary travel time” needed for legal counsel to appear in person.
August 23, 2023
Guaranty Association Seeks Stay In Breach Of Contract Suit Over Windstorm Damages

SARASOTA, Fla. — The Florida Guaranty Association (FIGA) moved to enforce a mandatory six-month stay in a homeowner’s breach of contract suit filed against FIGA and a now-insolvent insurer for failure to adequately compensate for a wind damage claim, arguing that pursuant to Florida law, proceedings involving an insolvent insurer shall be stayed for six months.
August 23, 2023
Illinois Law, Not New Jersey Law, Governs Travel Insurance Policies, Judge Says

NEWARK, N.J. — A New Jersey federal judge granted an insurer’s motion to dismiss a putative class action complaint alleging claims for violations of New Jersey law, breach of contract and bad faith based on the insurer’s denial of claims for the reimbursement of premiums paid for travel insurance policies following trip cancellations caused by the coronavirus pandemic because the master policy, which governs the travel insurance policies, is governed by Illinois law and not New Jersey law.
August 22, 2023
8th Circuit Affirms No Coverage Ruling In Kansas City Restaurants’ COVID-19 Suit

ST. LOUIS — The Eighth Circuit U.S. Court of Appeals on Aug. 21 affirmed a Missouri federal court’s judgment in favor of a commercial property insurer in a breach of contract lawsuit brought by the owner of several Kansas City restaurants and bars that were forced to close or reduce their operations as a result of the COVID-19 pandemic, finding that even if the insured discovered the coronavirus at its insured properties, it failed to meet the standard for physicality.
August 22, 2023
4th Circuit Denies Insurer’s Motion For Rehearing In Silo Collapse Dispute

RICHMOND, Va. — The Fourth Circuit U.S. Court of Appeal denied a petition for rehearing or rehearing en banc filed by insurers in a coverage dispute arising out of the collapse of the insured’s silo, refusing to reconsider its finding that a district court erred in reducing a jury’s $7.6 million award in favor of the insured based on the conclusion that the district court did not properly calculate the period of restoration pursuant to the policy’s terms.
August 22, 2023
Hurricane Ida Coverage Suit Against Insolvent Insurer Dismissed By Property Owner

NEW ORLEANS — The owner of a New Orleans multifamily dwelling allegedly damaged by Hurricane Ida voluntarily dismissed his breach of contract and breach of the duty of good faith and fair dealing suit filed in a Louisiana federal court against his insurer, a Florida company that was placed into receivership by a Florida court.
August 21, 2023
Alaska Federal Judge Limits Testimony Of Expert In Insurance Coverage Spat

ANCHORAGE, Alaska — An insurance industry standards expert is not qualified to opine on building codes or construction, an Alaska federal judge ruled, also finding that testimony that constitutes a legal conclusion in a dispute over insurance coverage for a damaged roof is excluded.
August 21, 2023
California High Court Agrees To Review Tribe’s Coronavirus Coverage Dispute

SAN FRANCISCO — The California Supreme Court granted an Indian tribe insured’s petition to review a state appellate court’s finding that the insured and its experts failed to present sufficient evidence to demonstrate that the coronavirus caused property damage to the tribe’s casino and resort.
August 18, 2023
Hurricane Coverage Suit Dismissed After Guaranty Association Added As Defendant

NEW ORLEANS — A Louisiana federal judge granted a homeowner’s motion to add the Louisiana Insurance Guaranty Association (LIGA) as a defendant and dismissed the homeowner’s breach of contract suit against LIGA and a now-insolvent insurer, finding that the court no longer has subject matter jurisdiction because the homeowner and LIGA are both citizens of Louisiana.
August 15, 2023
Judge Stays Wind Damage Case Against Homeowners Insurer, Cites Receivership Filing

McALLEN, Texas — A Texas federal judge on Aug. 14 stayed a breach of contract case against a homeowners insurer related to its purported failure to adequately cover a claim for wind damages, finding that a stay is merited because the Florida Department of Financial Services’ (DFS) “filing of the petition for receivership operates as an automatic stay under Florida law.”
August 14, 2023
Trial Court Erred In Denying Request To Add Punitive Damages Claim, Panel Says

DAYTONA BEACH, Fla. — A trial court erred in denying an insured’s motion for leave to amend a breach of contract and bad faith complaint to add a claim for punitive damages because the insured presented sufficient evidence in support of her contention that the insurer misrepresented the available coverage under the policy and that the insurer’s failure to properly investigate her claim was a general practice of the insurer.
August 11, 2023
Georgia Panel Affirms Dismissal Of Coronavirus Coverage Dispute

ATLANTA — A Georgia appeals panel affirmed a lower court’s grant of insurers’ motion to dismiss their mutual insured’s breach of contract lawsuit seeking coverage for its losses arising from the COVID-19 pandemic, saying the “overwhelming majority” of federal and state courts have rejected similar pandemic coverage claims.
August 09, 2023
Urban Outfitters Asks 3rd Circuit To Stay Appeal Of Coronavirus Coverage Suit

PHILADELPHIA — URBN US Retail LLC (Urban Outfitters) asked the Third Circuit U.S. Court of Appeals to stay its appeal of a lower federal court’s dismissal of its coverage lawsuit arising from the COVID-19 pandemic until the Pennsylvania Supreme Court has decided two cases that involve “the same issues of insurance law.”
August 08, 2023
Panel: Louisville Restaurant Owner Fails To Allege Loss In Coronavirus Coverage Suit

FRANKFORT, Ky. — A Kentucky appeals panel affirmed a lower court’s summary judgment ruling in favor of an insurer in a Louisville restaurant insured’s lawsuit seeking coverage for its lost income when it limited operations in response to the COVID-19 pandemic, finding the insured failed to assert a “loss” as defined by the policy.
August 07, 2023
Connecticut Judge Rules For Insurer In Coronavirus Coverage Dispute

HARTFORD, Conn. — A Connecticut judge granted a business owner insurer’s motion for summary judgment in its insured’s lawsuit seeking coverage for its losses arising from the coronavirus pandemic, rejecting the insured’s argument that the adhesion of coronavirus-infected respiratory droplets to its property caused direct physical loss or damage.
August 04, 2023
Federal Judge Grants University’s Motion To Remand Coronavirus Coverage Dispute

SEATTLE — A federal judge in Washington granted The Board of Regents of the University of Washington’s motion to remand its breach of contract and bad faith lawsuit seeking coverage for the alleged losses to its medical and athletic properties arising out of the coronavirus pandemic, finding that for the purposes of diversity jurisdiction, the university is an “arm of the state.”
August 03, 2023
Federal Judge Grants Insured’s Appraisal Motion In Hurricane Ida Coverage Dispute

NEW ORLEANS — A federal judge in Louisiana granted a commercial property owner insured’s motion to compel appraisal and stay its coverage lawsuit pending completion of appraisal, finding that the appraisal request complied with the insurance policy’s requirements for invoking appraisal and the insurers failed to contend otherwise.
August 02, 2023
Quoting A Showtune, 5th Circuit Affirms Ruling In Hurricane Sally Coverage Dispute

NEW ORLEANS — Opening with a quote of “Hello, Dolly” from the Broadway show with the same name and using a few nautical puns, the Fifth Circuit U.S. Court of Appeals on Aug. 1 affirmed a Louisiana federal court’s various rulings in favor of an insurer in its lawsuit alleging that a policy that insured the yacht HELLO DOLLY VI was void ab initio because the insured breached the warranty under the Hurricane Questionnaire/Plan.
August 02, 2023
Breach Of Contract, Bad Faith Claims Fail In Water, Mold Damage Suit

MOBILE, Ala. — Breach of contract and bad faith claims against a homeowners insurer fail because the insureds did not show that their home sustained a direct physical loss as a result of a hurricane or that a material issue of dispute exists as to whether the insurer acted in bad faith in investigating and adjusting their claim for water and mold damages, an Alabama federal judge said in granting the insurer’s motion for summary judgment.
August 01, 2023
Panel Affirms Ruling In Insurer’s Favor In Medical Provider’s COVID-19 Suit

PORTLAND, Ore. — After the Oregon Supreme Court declined to answer a certified question in a coronavirus coverage dispute, the Ninth Circuit U.S. Court of Appeals on July 31 reassumed jurisdiction and concluded that the Oregon high court would interpret the phrase “direct physical loss or damage” to require physical alteration of the insured property and affirmed a federal court’s finding that a medical provider insured failed to state a claim for coverage for its losses arising from the pandemic.
July 31, 2023
Federal Judge Dismisses Hurricane Harvey Coverage Dispute Between Insureds, Broker

HOUSTON — A federal judge in Texas dismissed with prejudice a Hurricane Harvey coverage dispute the same day the insureds and their insurance broker filed a joint stipulation of dismissal.
July 28, 2023
Federal Judge Remands Hailstorm Damage Suit Against Homeowners Insurer, Agency

OKLAHOMA CITY — An Oklahoma federal judge remanded a lawsuit filed by insureds against their homeowners insurer and insurance agency after determining that the insurer failed to carry its burden of proving that the agency was fraudulently joined to the breach of contract and bad faith suit to defeat federal diversity jurisdiction.
July 28, 2023
Breach Of Contract, Bad Faith Suit To Remain In Oklahoma Federal Court

OKLAHOMA CITY — A breach of contract and bad faith suit filed against a homeowners insurer will remain in Oklahoma federal court because at the time of removal from state court, the insurer made a plausible showing that the amount in controversy exceeded the federal jurisdictional minimum of $75,000, an Oklahoma federal judge said in denying the insureds’ motion to remand.