Justia Insurance Law Opinion Summaries

National Western Life Insurance Company (NWL) appealed after it was held liable for negligence and elder abuse arising from an NWL annuity sold to Barney Williams by Victor Pantaleoni. In 2016, Williams contacted Pantaleoni to revise a living trust after the death of Williams’ wife, but Pantaleoni sold him a $100,000 NWL annuity. When Williams returned the annuity to NWL during a 30-day “free look” period, Pantaleoni wrote a letter over Williams’ signature for NWL to reissue a new annuity. In 2017, when Williams cancelled the second annuity, NWL charged a $14,949.91 surrender penalty. The jury awarded Williams damages against NWL, including punitive damages totaling almost $3 million. In the Court of Appeal's prior opinion reversing the judgment, the Court concluded Pantaleoni was an independent agent who sold annuities for multiple insurance companies and had no authority to bind NWL. The Court determined that Pantaleoni was an agent for Williams, not NWL. The California Supreme Court vacated that decision and remanded, asking the appeals court to reconsider its finding that Pantaleoni did not have an agency relationship with National Western Life Insurance Company in light of Insurance Code sections 32, 101, 1662, 1704 and 1704.5 and O’Riordan v. Federal Kemper Life Assurance Company, 36 Cal.4th 281, 288 (2005). Upon remand, the Court of Appeal affirmed the judgment finding NWL liable for negligence and financial elder abuse. However, punitive damages assessed against NWL were reversed. The Court found no abuse of discretion in the trial court’s calculation of the attorney fee award, but remanded the case for the court to reconsider the award in light of the reversal of punitive damages. View "Williams v. Nat. W. Life Ins. Co." on Justia Law

This case arose from a claim for underinsured motorist (UIM) benefits by Plaintiff-Appellant Melinda Eckard (insured) against her insurer, Defendant-Appellee State Farm Mutual Automobile Insurance Company (State Farm). On summary judgment, the district court held that Eckard’s suit was time barred by Colorado Revised Statutes section13-80-107.5(1)(b). The Tenth Circuit reversed, finding the district court granted summary judgment to State Farm because it incorrectly found as a matter of law that Eckard “received payment of the settlement” when her lawyer received the settlement agreement and check on October 11, 2019. As was explained, Eckard actually “received payment of the settlement” when she executed the settlement agreement and authorized the check on November 7, 2019. As a result, section 13-80-107.5(1)(b) did not bar Eckard’s UIM claim against State Farm. View "Eckard v. State Farm Mutual Automobile" on Justia Law

Alissa's Flowers filed suit against State Farm, alleging that it had overpaid its premiums to State Farm in light of its significantly lower exposure rate due to COVID-19. State Farm moved to dismiss the amended complaint, arguing that Missouri law required that Alissa's Flowers bring its claims before the director of the Missouri Department of Insurance.The Eighth Circuit affirmed the district court's dismissal of the complaint, concluding that the administrative review process set forth in Mo. Rev. Stat. 379.348 applies in the commercial insurance context and to plaintiff's claims in this case. The court explained that the district court properly determined that Alissa's Flowers was required to exhaust administrative remedies because the claims, in essence, constitute a challenge to State Farm's rates, rating plan, rating system and underwriting rules. Finally, the complaint should not have been dismissed for lack of subject matter jurisdiction, but rather for lack of authority to grant relief. View "Alissa's Flowers, Inc. v. State Farm Fire & Casualty Co." on Justia Law

Erick Pena filed a declaratory action against Viking Insurance Company of Wisconsin (“Viking”), alleging the automobile insurance policy he purchased was illegal because it provided illusory minimum limits of UIM coverage. Pena then filed a motion for summary judgment asking the court to declare that the UIM coverage was illusory. Viking filed a cross-motion for summary judgment, arguing that the policy was not illusory because it provided tangible benefits to a group of insured persons and that the offset provision in the policy complied with Idaho public policy. The district court granted Viking’s motion for summary judgment. Pena timely appealed. After review, the Idaho Supreme Court reversed, finding the policy at issue indeed provided illusory coverage. View "Pena v. Viking Insurance Company" on Justia Law

The Fifth Circuit affirmed the district court's grant of summary judgment to Atlantic, concluding that the action is precluded on res judicata grounds. The court clarified some doctrinal confusion in its law about Louisiana principles of res judicata that one of its sister circuits has observed. The court concluded that this action arises out of the same nucleus of facts as plaintiff's initial suit, the issue of Atlantic's alleged bad faith misrepresentation of underinsured motorist coverage could have been raised in that initial suit, and plaintiff did not specifically reserve the right to bring this second suit as part of his settlement agreement with Atlantic. While plaintiff is correct that Louisiana's bad faith statutes impose duties on Atlantic that are separate and distinct from its duties under the insurance contract, this action remains barred by res judicata. Finally, this case does not present an exceptional circumstance exception to res judicata. View "Dotson v. Atlantic Specialty Insurance Co." on Justia Law

An explosion at the Omega Protein Plant in Moss Point, Mississippi killed one man and seriously injured several others. Multiple lawsuits were filed against Omega in federal district court. Colony Insurance Company filed a declaratory judgment action in state circuit court seeking a declaration that it did not cover bodily injuries arising out of the Moss Point facility explosion. Evanston Insurance Company intervened also seeking a declaration of no coverage for the same injuries: Evanston provided a $5 million excess liability policy, which provided coverage after Colony’s $1 million policy was exhausted. Because Colony settled one of the underlying personal injury cases for $1 million (the limits under its policy), Omega sought excess coverage from Evanston for the injuries that occurred at its plant. A special master was appointed, and the trial court granted Evanston’s motion for summary judgment, finding that the pollution exclusion in the insurance contract barred coverage. Omega appealed that grant of summary judgment. The Mississippi Supreme Court found that a pollution exclusion in the insurance contract was ambiguous, and should have been construed in favor of the insured, allowing coverage. Further, the Court found the question of whether coverage was triggered was governed by the language of the contract, and that Evanston failed to prove there could be no coverage under the excess liability policy. Therefore, the Supreme Court reversed the trial court’s grant of summary judgment as to all issues and remanded the case for further proceedings. View "Omega Protein, Inc. v. Evanston Insurance Company" on Justia Law

William Greenwood was in the business of salvaging valuable materials from old buildings. Greenwood was insured by Mesa Underwriters Specialty Insurance Company through a policy sold by Dixie Specialty Insurance. Greenwood was later sued by adjoining building owners who complained he had damaged their property, and Mesa denied coverage based, in part, on a policy exclusion for demolition work. Greenwood later brought suit against his insurers alleging breach of contract and bad-faith denial of coverage. Greenwood averred that his business was actually “deconstruction” rather than demolition, but the trial court granted summary judgment to the insurers. Finding no reversible error in that judgment, the Mississippi Supreme Court affirmed the trial court. View "Estate of Greenwood v. Montpelier US Insurance Company, et al." on Justia Law

Through a bankruptcy proceeding, Bristol became the successor-in-interest to Haven, an accredited mental-health and substance-abuse treatment center that regularly serviced patients insured by Cigna. Bristol alleged that Cigna violated the Employee Retirement Income Security Act of 1974 (ERISA) and state law by denying Haven’s claims for reimbursement for services provided. Haven was out-of-network for Cigna’s insureds. The district court dismissed Bristol’s ERISA claim, as an assignee of a healthcare provider, for lack of derivative standing, or lack of authority to bring a claim under ERISA, 29 U.S.C. 1132(a)(1)(B).The Ninth Circuit reversed. Under ERISA, a non-participant health provider cannot bring claims for benefits on its own behalf but must do so derivatively, relying on its patients’ assignments of their benefits claims. Other assignees also may have derivative standing if extending standing would align with the goal of ERISA. Refusing to allow derivative standing for Bristol would create serious perverse incentives that would undermine the goal of ERISA. Denying derivative standing to health care providers would harm participants or beneficiaries because it would discourage providers from becoming assignees and possibly from helping beneficiaries who were unable to pay up-front. View "Bristol SL Holdings, Inc. v. Cigna Health and Life Insurance Co." on Justia Law

Ikia Pope and Brandi Powell were in a motor vehicle collision. Pope left the scene of the collision. Powell alleged Pope drove a vehicle owned by third parties who gave permission for Pope to drive the vehicle. Progressive Direct Insurance Company insured the vehicle driven by Pope. Powell made bodily injury and property damage claims with Progressive Direct Insurance Company (insurer). Powell asserted she was entitled to treble property damages. Progressive sought a declaratory judgment for the purpose of adjudicating whether its insurance policy excluded treble damages pursuant to 47 O.S.2011, section 10-103. Progressive filed a motion for summary judgment, and the court concluded the treble damages provided by 47 O.S. 2011, section 10-103 were punitive in nature, and excluded by a clause excluding punitive damages. Powell appealed the subsequent consent judgment which was based, in part, upon the trial court's adjudication of the treble damages issue. The Oklahoma Supreme Court retained the appeal sua sponte, concurring with the district court that the statutory treble damages in 47 O.S.2011, section 10-103 were punitive in nature, and punitive damages were expressly excluded by the policy. View "Progressive Direct Ins. Co. v. Pope" on Justia Law

Appellees, Rite Aid Corporation, Rite Aid Hdqtrs. Corp., and Rite Aid of Maryland, Inc. (collectively, “Rite Aid”), held a general liability insurance policy underwritten by defendany Chubb, Limited ("Chubb"). Rite Aid and others were defendants in multi-district litigation before the United States District Court for the Northern District of Ohio (the “MDL Opioid Lawsuits”). Plaintiffs in that suit filed over a thousand suits in the MDL Opioid Lawsuits against companies in the pharmaceutical supply chain for their roles in the national opioid crisis. Certain suits were bellwether suits - including the complaints of Summit and Cuyahoga Counties in Ohio (“the Counties”) which were at issue here. The question this case presented for the Delaware Supreme Court was whether insurance policies covering lawsuits “for” or “because of” personal injury required insurers to defend their insureds when the plaintiffs in the underlying suits expressly disavowed claims for personal injury and sought only their own economic damages. The Superior Court decided that Rite Aid’s insurance carriers were required to defend it against lawsuits filed by two Ohio counties to recover opioid-epidemic-related economic damages. As the court held, the lawsuits sought damages “for” or “because of” personal injury because there was arguably a causal connection between the counties’ economic damages and the injuries to their citizens from the opioid epidemic. The Supreme Court reversed, finding the plaintiffs, governmental entities, sought to recover only their own economic damages, specifically disclaiming recovery for personal injury or any specific treatment damages. Thus, the carriers did not have a duty to defend Rite Aid under the governing insurance policy. View "ACE American Insurance Company v. Rite Aid Corporation" on Justia Law