Justia Insurance Law Opinion Summaries
Gibson v. State Farm Mutual Automobile Insurance Co.
Basic underinsured motorist (UIM) coverage is equal to the policy's bodily injury limits; Pennsylvania insureds can reduce costs by making a “request in writing” for lower UIM coverage. Gibson signed a State Farm (SF) insurance application for bodily injury coverage of $250,000 with $100,000 in stacked UIM coverage; for the Gibsons' three cars, the total UIM coverage described was $300,000. The application's signature block attested that “the limits and coverages ... were selected by me”; the last page referenced other “required” documents, including an acknowledgment of UIM coverage selection. SF did not provide those additional forms. Gibson was seriously injured in an accident. Weeks later, Gibson returned to SF and signed the form, stating that UIM benefits “are available with limits up to the Liability Coverage limits for bodily injury” and that she had selected “lower limits of $100,000 (per person)/$300,000 (per accident).”Gibson sued for UIM coverage, breach of contract, and bad faith, demanding “the maximum amount of UIM coverage,” of “$300,000.” A Magistrate granted SF summary judgment on the bad faith claim. A jury awarded Gibson $1,750,000. SF moved to mold the verdict to the UIM policy limit, $300,000, listed on the application and in the complaint. Gibson successfully cross-moved to mold the verdict to $750,000 (the $250,000 bodily injury limit stacked for three cars), arguing that the application to elect a lower UIM policy limit did not comply with Pennsylvania’s Motor Vehicle Financial Responsibility Law. The Third Circuit reversed. The statute’s minimal requirement of a “request in writing” for the lower optional UIM coverage was met. The court affirmed the dismissal of the bad faith claim. View "Gibson v. State Farm Mutual Automobile Insurance Co." on Justia Law
State ex rel. COUNTRY Mutual Insurance Co. v. Honorable Brian H. May
The Supreme Court issued a permanent writ in prohibition directing Respondent, the Honorable Brian H. May, to vacate his orders in the case entered after Insurer filed its application for change of judge and to sustain the application for change of judge, holding that Insurer was entitled to the writ.In the underlying wrongful death suit Insurer filed a motion to intervene and stay proceedings while its contractual obligation to provide coverage was determined in a pending declaratory judgment action. Judge David Lee Vincent sustained the motion to intervene but overruled the motion to stay the proceedings. Thereafter, Judge Vincent entered an order of recusal, and the case was reassigned to Respondent. Insurer then filed this petition for writ of prohibition. The Supreme Court issued the writ and directed Respondent to vacate his order overruling Insurer's application for change of judge and the order sustaining a motion to quash Insurer's notice of deposition, holding that Insurer was entitled to a change of judge. View "State ex rel. COUNTRY Mutual Insurance Co. v. Honorable Brian H. May" on Justia Law
Collison v. Director of Revenue
The Supreme Court affirmed the decision of the Administrative Hearing Commission (AHC) finding that David and Gale Collison were not entitled to a sales tax credit following their purchase of a vehicle to replace another vehicle declared a casualty loss by their insurance company, holding that the Collisons could not prevail in this matter.In denying the requested sales tax credit the AHC found that a revocable trust, not the Collisons, owned the new vehicle and that the Collisions, and not the revocable trust, owned the replaced vehicle. On appeal, the Collisons argued that they and the revocable trust were the same owner of the separate vehicles and the same entity for purposes of the sales tax credit. The Supreme Court affirmed, holding that because Missouri law clearly considers a trust and the natural persons who create and control the trust to be separate and distinct entities, the Collisons and their revocable trust were legally separate owners. View "Collison v. Director of Revenue" on Justia Law
California v. Clapp
Defendant Daniel Clapp plead no contest to concealing the true extent of his physical activities and abilities from his employer, the Department of the California Highway Patrol (CHP), and the State Compensation Insurance Fund (SCIF). Consistent with a resolution negotiated by the parties, the trial court granted defendant three years’ probation, and as a condition of probation, ordered him to pay restitution. Following a hearing, defendant was ordered to pay $30,095.68 to SCIF for temporary disability benefits and $81,768.01 to CHP for benefits wrongfully obtained. He was also ordered to pay $1,350 and $70,159 to SCIF and CHP respectively for investigative costs. Defendant appealed the restitution award as to investigation costs contending that, as public investigative agencies, neither SCIF nor CHP was entitled to reimbursement for the costs of investigating his claim. After review, the Court of Appeal concluded that as direct victims of defendant’s fraud, both CHP and SCIF were indeed entitled to restitution for investigative costs incurred in an effort to justify discontinuance of payments and recoup money defendant fraudulently obtained. View "California v. Clapp" on Justia Law
Bernard v. Kansas City Life Insurance Co.
After plaintiff admitted to using fentanyl at work, he was terminated from his position as a certified nurse anesthetist at Mid-Missouri. Plaintiff then submitted claims for short- and long-term disability benefits to Kansas City Life, which issued disability insurance policies to Mid-Missouri as part of its employee benefit plan.The Eighth Circuit affirmed the the district court's conclusion that Kansas City Life had abused its discretion in denying plaintiff benefits under the Employee Income Security Act of 1974 (ERISA). The court concluded that Kansas City Life's denial of benefits is not supported by substantial evidence where reasonable minds could not reconcile Kansas City Life's position that plaintiff was unable to safely administer anesthesia on October 6, 2017, with its position that he had safely administered anesthesia while under the influence of fentanyl during the time period between his relapse and termination. Therefore, the evidence that plaintiff made no medical errors and did not seek treatment until after he was terminated, as well as the fact that the record does not disclose his exact date of disability, could not support Kansas City Life's conclusion that plaintiff was not disabled before his insurance coverage ended. View "Bernard v. Kansas City Life Insurance Co." on Justia Law
Boyer v. Schneider Electric Holdings, Inc.
Plaintiff sought life and accidental death benefits under her brother's insurance plan after he died in a single-vehicle crash. Unum Life paid plaintiff life insurance benefits, but denied her claim for accidental death benefits. Plaintiff filed suit under the Employee Retirement Income Security Act of 1974 (ERISA).The Eighth Circuit reversed the district court's grant of summary judgment for plaintiff, concluding that the administrator's decision was supported by substantial evidence. The court explained that the evidence is sufficient to support a reasonable finding that the brother's speeding and improper passing contributed to the crash; the crime exclusion applies to "accidental losses;" and Unum Life's interpretation of the "crime" exclusion was reasonable because the brother's conduct constituted a crime under Missouri law. In this case, the brother was driving more than twice the legal speed limit and passing vehicles in a no-passing zone on a two-lane road in icy road conditions. Furthermore, Missouri's classification of improper passing and speeding as misdemeanor offenses reinforces the reasonableness of Unum Life's determination. View "Boyer v. Schneider Electric Holdings, Inc." on Justia Law
Dillon Gage, Inc. v. Certain Underwriters at Lloyds
The Fifth Circuit certified the following questions to the Supreme Court of Texas: 1. Whether Dillon Gage's losses were sustained consequent upon handing over insured property to UPS against a fraudulent check, causing the policy exclusion to apply. And if that answer is yes: 2. Whether UPS's alleged errors are considered an independent cause of the losses under Texas law. View "Dillon Gage, Inc. v. Certain Underwriters at Lloyds" on Justia Law
Nationwide Property & Casualty Insurance Co. v. Selective Way Insurance Co.
The Court of Appeals affirmed the judgment of the court of special appeals concluding that prejudgment interest on defense costs where a party breaches its duty to defend does not fall within the exception to the "modified discretionary approach" and is within the discretion of the fact-finder.The modified discretionary approach used by Maryland courts in awarding prejudgment interest generally places the award of prejudgment interest within the discretion of the trier of fact but also recognizes exceptions where a plaintiff is entitled to prejudgment interest as a matter of right. At issue was whether prejudgment interest should be awarded as a matter of right. The Court of Appeals held (1) prejudgment interest on defense costs is left to the discretion of the fact-finder; and (2) where the jury in this case was not presented with a claim of prejudgment interest, was not instructed on the issue, and did not separately state an award of prejudgment interest in the verdict, the circuit court was not authorized to award prejudgment interest. View "Nationwide Property & Casualty Insurance Co. v. Selective Way Insurance Co." on Justia Law
Allianz Global Risks v. ACE Property & Casualty Ins. Co.
Daimler-Benz AG acquired Freightliner Corporation (Freightliner) from Consolidated Freightways (now Con-Way) in 1981. As part of the transaction, it liquidated Freightliner’s assets and liabilities into a subsidiary, Daimler Trucks North America LLC (Daimler). Between 1952 and 1982, Freightliner and then Daimler had engaged in business activities, primarily the manufacture of trucks, that subsequently led to several environmental remediation proceedings, including claims related to the Portland Harbor Superfund cleanup, and to some 1,500 asbestos personal injury claims. Plaintiffs Allianz Global Risk US Insurance and Allianz Underwriters Insurance Company (Allianz) insured Freightliner in 1981 and Daimler from 1981 to 1986 through a general commercial liability insurance policy. Daimler also purchased from Allianz another policy to provide coverage for future claims that might be made against Freightliner based on its past operations that were “incurred but not yet reported.” By the time it filed the operative complaint in this action in 2014, Allianz had spent more than $24 million defending and paying environmental and asbestos claims against Daimler and the now-dissolved Freightliner arising from Freightliner’s business operations between 1952 and 1982. In this litigation, Allianz sought contribution for the payments it has made and will make in the future based on those environmental and asbestos claims from insurance companies that insured Freightliner -- either directly or through its parent, Con-Way -- from 1976 to 1982. The Oregon Supreme Court reversed the Court of Appeals' holding that Daimler did not assume the contingent liabilities of Freightliner (including the liabilities at issue here) and affirmed the jury verdict on that issue. On Allianz's appeal, the Supreme Court agreed that the trial court erred in submitting to the jury the question of whether, because of side agreements between Con-Way/Freightliner and the insurers, those insurers had a "duty to defend or indemnify Freightliner" -- that question was to be decided by the trial court as a matter of law based on the relevant policies. As to the "London pollution exclusion", the Supreme Court agreed with Allianz that it was error for the trial court not to provide a legal interpretation of a key provision in the policy as part of the jury instructions. The Court also concluded that the jury instructions regarding the London pollution exclusion should be similar to those regarding the Domestic exclusion. The decision of the Court of Appeals was reversed. The limited judgments of the trial court were affirmed in part and reversed in part, and the case was remanded to the trial court for further proceedings. View "Allianz Global Risks v. ACE Property & Casualty Ins. Co." on Justia Law
Ryberg, et al. v. Landsiedel
Jason Ryberg appealed the dismissal of his complaint with prejudice after the district court granted Defendant Darren Landsiedel’s motion to enforce a settlement agreement. Nodak Insurance Company (“Nodak”) appealed the court’s order denying its motion to intervene in the case. In November 2016, Ryberg’s wife, Heather Ryberg, was killed when Landsiedel’s vehicle hit her on a rural Burleigh County highway in the early morning hours. In March 2018, Ryberg sued Landsiedel for the wrongful death of his wife. Landsiedel was insured by Allstate Insurance Company and had liability policy limits of $25,000. Ryberg was insured by Nodak, with “substantial” underinsured motorist (“UIM”) limits. Allstate offered Ryberg policy limits to settle his wrongful death claim. Ryberg notified Nodak of Allstate’s offer of the policy limits for “full and final settlement” of the wrongful death claim. Nodak agreed to advance payment of $25,000 to Ryberg to maintain its reimbursement or subrogation rights under N.D.C.C. 26.1-40-15.5. A week before the scheduled trial on Ryberg’s wrongful death action against Landsiedel, Nodak and Ryberg agreed to settle Ryberg’s UIM claim for $100,000, in addition to the $25,000 Nodak already paid under the statute. After being notified, Landsiedel’s counsel filed a notice of settlement with the district court, and the case was taken off the calendar. Because no closing documents were filed, the court set a status conference for February 27, 2020. On the day of the status conference, Nodak moved to intervene in the action, seeking to preserve its right of reimbursement or subrogation. Landsiedel filed a substitution of counsel, moved for an extension of time, and subsequently opposed the motion to intervene. The court denied Nodak’s motion to intervene, finding it was untimely. In June 2020, Landsiedel filed a motion to enforce a settlement agreement. Ryberg opposed the motion and requested oral argument. The district court granted Landsiedel’s motion. Judgment was entered dismissing the case with prejudice. The North Dakota Supreme Court found no evidence established the terms by which the parties intended to settle Ryberg’s action, thus, the district court erred in granting Landsiedel’s motion seeking to enforce a settlement agreement. The Court vacated the order denying intervention and reversed the judgment of dismissal. View "Ryberg, et al. v. Landsiedel" on Justia Law