Justia Insurance Law Opinion Summaries

The New York City Off-Track Betting Corporation (NYC OTB) was a public benefit corporation charged with operating an off-track pari-mutuel betting system within the City. Later, NYC OTB filed for bankruptcy and shut down. The City's Corporation Counsel then announced that NYC OTB retirees would lose coverage under the City's health insurance and welfare benefit plans because the Corporation was no longer able to reimburse the City. A union representing NYC OTB employees and retirees and others (collectively, Plaintiffs) brought suit against the State and City, seeking a judgment declaring that the failure of the State and City to fund, and the termination of retiree health insurance and supplemental benefits, violated the City Administrative Code and other express and implied obligations. Supreme Court rejected the four theories advanced by Plaintiffs to support State or City liability for NYC OTB retiree health benefits. The appellate division affirmed. The Court of Appeals affirmed, holding (1) Plaintiffs did not demonstrate a likelihood of success on the merits of their claim against the City; and (2) because NYC OTB had a legal identity separate from the State, Plaintiffs stated no viable theory under which the State could be held liable in this case. View "Roberts v. Paterson" on Justia Law

In a 5-4 ruling, the Supreme Court has upheld the 2010 Patient Protection and Affordable Care Act. While only four Justices found its requirement that certain individuals pay a financial penalty for not obtaining health insurance (26 U.S.C. 5000A) constitutional under the Commerce Clause, Chief Justice Roberts found it constitutional by reasonably characterizing it as a tax. Chief Justice Roberts wrote: “it is not our role to forbid it, or to pass upon its wisdom or fairness." The penalty is to be paid to the IRS, along with the individual’s income taxes. In a limited ruling, the Court held that the Act’s “Medicaid expansion” is unconstitutional in threatening states with loss of existing Medicaid funding if they decline to comply, but that the penalty provision is severable (which means that failure of that provision does not cause the entire Act to fail). The Act requires that state programs provide Medicaid coverage by 2014 to adults with incomes up to 133 percent of the federal pov­erty level, (many states now cover adults with children only if their income is considerably lower, and do not cover childless adults at all) and increases federal funding to cover states’ costs, 42 U.S.C. 1396d(y)(1). The decision leaves intact less controversial provisions, protecting individuals with preexisting conditions, allowing children to be covered by parents’ insurance until age 26, and prohibiting higher costs for insuring women. View "Nat'l Fed'n of Indep. Bus. v. Sebelius" on Justia Law

The United States Court of Appeals for the Eleventh Circuit certified two questions to the Georgia Supreme Court: "(1) Did the Georgia Insurance Commissioner act within his legal authority when he promulgated Ga. Comp. R. & Regs. 120-2-20-.02, such that a multiple-line insurance policy providing first-party insurance coverage for theft-related property damage must be reformed to conform with the two-year limitation period provided for in Georgia's Standard Fire Policy, Ga. Comp. R. & Regs. 120-2-19-.01?; and, (2) is this action barred by the Policy's one-year limitation period?" These questions arose from a dispute over Petitioner Ricardo White's purchase of a homeowner's insurance policy from Respondent State Farm Fire and Casualty Company. The insurance policy was a first-party insurance contract that provided multiple-line coverage, including coverage for loss or damage caused by both fire and theft. The policy contained a limitation provision stating that a lawsuit against State Farm must be brought "within one year of the date of loss or damage." After his home was burglarized in January 2008 (within the period of coverage), Petitioner filed a claim for the loss of more than $135,000 in personal property. State Farm denied the claim based on its determination that Petitioner misrepresented material information in filing his claim. Waiting more than one year after his date of loss, Petitioner filed a June 2009 complaint against State Farm in state court alleging claims for breach of contract, bad faith, and fraud. Upon review of the facts of this case, the Supreme Court found that: (1) the Georgia Insurance Commissioner did not act within his legal authority and (2) this action was barred by the one-year limitation period in his insurance policy. View "White v. State Farm Fire & Casualty Co." on Justia Law

This case involved a policy for uninsured-motorist (UM) coverage issued by Defendant State Farm Mutual Automobile Insurance Company which contained a 30-day notice provision regarding hit-and-run motor vehicle claims. Upon review, the Court held that an unambiguous notice-of-claim provision setting forth a specified period within which notice must be provided is enforceable without a showing that the failure to comply with the provision prejudiced the insurer. Therefore, State Farm properly denied the claim for UM benefits sought in the instant case because it did not receive timely notice, a condition precedent to the policy's enforcement. In this case, the Court reversed the judgment of the Court of Appeals and remanded the case to the trial court for entry of summary disposition in favor of State Farm.

This appeal arose from an insurance coverage dispute where the City sought coverage from Genesis for 42 U.S.C. 1983 claims in the nature of malicious prosecution. Genesis filed suit against the City, seeking a declaratory judgment that its policies provided no coverage for the underlying actions. The district court granted summary judgment to Genesis and the City appealed, arguing that the district court erred in ruling as a matter of law that the policies did not provide the City insurance coverage for the claims. Because Genesis did not have an insurance contract with the City in 1977, when the underlying charges were filed, it did not have a duty to defendant and indemnify the city in the suits. Accordingly, the court affirmed the judgment.

A 2011 amendment to Section 71-3-51 provides that, "from and after July 1, 2011," decisions of the Mississippi Workers' Compensation Commission may be appealed directly to the Supreme Court, rather than to the circuit court, as required under the previous version of the statute. On July 1, 2011, the Commission denied Petitioner Joseph Dewayne Johnson’s claim for benefits, so he appealed to the Supreme Court. The ordered the parties to brief two issues: whether Section 71-3-51, as amended was constitutional; and whether the Court had appellate jurisdiction over direct appeals from the Commission. Upon review, the Court concluded that Section 71-3-51 was constitutional, and that the Court had appellate jurisdiction over direct appeals from the Commission.

Following the destruction of his home in Hurricane Katrina, plaintiff sued Liberty Mutual for negligent misrepresentation to recover the difference between his flood insurance coverage he had and the coverage he could have purchased under the preferred riskier insurance policy. The district court concluded that plaintiff's claim was not preempted by federal law and sent the case to the jury which awarded plaintiff in compensatory damages. Because plaintiff's dispute with Liberty Mutual related to his renewal of a policy already in place, Campo v. Allstate Ins. Co. did not control and the court held that plaintiff's state law claim was preempted. Because the Federal Emergency Management Agency (FEMA) was presumed to be paying both the litigation expenses and any resulting damage award, the district court erred in submitting this case to the jury. Because Liberty Mutual was not offering insurance advice, was not a fiduciary of plaintiff, and did not offer any statement to plaintiff to imply the lack of alternative insurance options, Mississippi law would not recognize negligent misrepresentation as a cause of action against Liberty Mutual and the submission of negligent misrepresentation to the jury was error. Accordingly, the court reversed with instructions to dismiss plaintiff's claim

Mary Arnold, who was injured in an automobile collision, brought a negligence action against the other driver, Jonathan Wallace, who was uninsured. Travelers Insurance Company, Arnold's carrier, defended the suit pursuant to its uninsured motorist coverage. The jury awarded a verdict for Arnold in the amount of $9,134. Arnold appealed. The Supreme Court affirmed, holding that the circuit court (1) did not err in admitting medical records under the business records exception, as there was established a sufficient foundation for the admission of the evidence; and (2) did not abuse its discretion in finding an expert physician qualified to testify when her partner previously had been retained by the opposing counsel.

Plaintiff's son, Hayden, was involved in a near-drowning accident in which he suffered severe permanent injuries. Plaintiff subsequently sought coverage for the cost of his treatment from Wasatch Crest Mutual Insurance, under which Hayden was insured. Wasatch Crest was later declared insolvent, and Plaintiff filed a claim against the Wasatch Crest estate. The liquidator of the estate denied Plaintiff's claim, concluding that Wasatch Crest had properly terminated coverage under the language of the plan. The Supreme Court reversed, interpreting the plan in favor of coverage. Plaintiff resubmitted her claim for medical expenses to the liquidator for payment under the Utah Insurers Rehabilitation and Liquidation Act. One year later, Plaintiff filed a motion for summary judgment with the district court. The liquidator subsequently issued a second amended notice of determination denying Plaintiff's claim on the merits. The district court then denied Plaintiff's motion for summary judgment, as Plaintiff had not yet challenged the second amended notice of determination and could do so under the Liquidation Act. Plaintiff appealed the district court's order. The Supreme Court dismissed the appeal because Plaintiff did not appeal from a final judgment and had not satisfied any of the exceptions to the final judgment rule.

Casey Stuivnga and Britni Evans were injured in a single-vehicle accident. The vehicle was owned by Stuivenga. Both Stuivenga and Evans claimed the other person was driving and was liable to the other for their injuries. They both sought proceeds available under an automobile insurance policy issued to Stuivenga by Progressive Direct Insurance Company. Progressive determined that Evans' and Stuivenga's competing claims could not be settled in an amount equal to or less than the policy's per person liability limit of $25,000. Progressive commenced an interpleader action and deposited the $25,000 with the district court, asking the court to determine to whom the funds should be issued. Ultimately, a jury found that Evans was the driver at the time of the accident and released the $25,000 to Stuivenga. The Supreme Court affirmed, holding (1) this appeal was not moot, as the issue presented at the outset of the action of who was driving had not ceased to exist, and Stuivenga's payment of the funds to third parties did not render the Court unable to grant effective relief; and (2) the district court did not abuse its discretion in denying Evans' motion for a new trial.