Justia Insurance Law Opinion Summaries

Kiselewski was driving with his two granddaughters in the backseat. Klamm's vehicle crossed the center line and struck Kiselewski’s vehicle. Kiselewski, one granddaughter, and Klamm were killed. Klamm was insured under a Meridian policy issued to his mother that provides coverage for four vehicles. The policy contains an “antistacking clause” with respect to bodily injury liability limits of $100,000 per person and $300,000 per accident. In a declaratory judgment action, the circuit court found that the policy, taken as a whole, was ambiguous and declared that Meridian had a duty under the policy to aggregate the bodily injury coverage limits for all four vehicles covered by the policy, resulting in coverage in the amount of $400,000 per person and $1.2 million per accident.The Illinois Supreme Court reversed. When the declarations are read together with the antistacking clause, there is no ambiguity. The policy provides bodily injury liability coverage of $100,000 per person and $300,000 per accident, regardless of the number of claims, insureds, covered vehicles, premiums, or vehicles involved in the accident. The policy does not list liability limits separately for each covered vehicle. It lists the limits once on the first page of the declarations, next to Autos 1, 2, and 3, and once on the second page, next to Auto 4. View "Hess v. Estate of TJay Klamm" on Justia Law

While driving a car insured by Arizona Automobile Insurance Company, Marlena Whicker rear-ended a taxi and injured its passenger, Georgiana Chavez. Chavez sued Whicker in Colorado state court and won a default judgment when neither Whicker nor Arizona entered a defense. Whicker, unable to satisfy the judgment from the lawsuit, assigned her rights against Arizona to Chavez, who then filed this diversity suit against Arizona in federal court for failure to defend Whicker in the underlying state court action. Her theory was that Arizona had a duty to defend Whicker under Colorado law because Arizona knew that she was a driver covered under its policy. The district court disagreed with Chavez and granted Arizona’s motion to dismiss. The Tenth Circuit determined that under Colorado law, Arizona was only required to defend Whicker if Chavez’s complaint plausibly alleged Whicker was insured under the Arizona policy. It therefore reached the same conclusion as the district court and, affirmed its dismissal of Chavez’s case. View "Chavez v. Arizona Automobile Ins. Co." on Justia Law

ABK, LLC owned and operated a gas station in Post Falls, Idaho where underground storage tanks were damaged due to water infiltration into the gas stored in the tanks. After the damage occurred, ABK submitted a claim to its insurer, Mid-Century Insurance Company. Mid-Century denied the claim. ABK then sued Mid-Century alleging breach of contract and bad faith. Mid-Century moved for summary judgment on both claims. The district court granted summary judgment for Mid-Century on ABK’s breach of contract claim finding ABK failed to raise a genuine dispute as to the fact the underground storage tanks were damaged by water, specifically excluded by the terms of the policy. The district court also granted summary judgment for Mid-Century on ABK’s bad faith claim finding ABK failed to establish coverage. ABK appealed the district court’s grant of summary judgment in favor of Mid-Century on both claims. Finding no reversible error, the Idaho Supreme Court affirmed. View "ABK v. Mid-Century Insurance" on Justia Law

Plaintiff Robert Barnes filed a putative class action against defendant Security Life of Denver Insurance Company (SLD) alleging that SLD, in the course of administering life insurance policies purchased by Barnes and other similarly-situated class members, breached its contractual duties and committed the tort of conversion by imposing certain administrative costs that were not authorized under the terms of the policies. Jackson National Life Insurance Company (Jackson) moved to intervene, asserting that, as a result of reinsurance agreements entered into by SLD, Jackson was actually the entity responsible for administering Barnes’s policy and numerous other policies listed within the putative class. The district court denied Jackson’s motion. After reviewing the parties’ briefs and the record on appeal, the Tenth Circuit concluded Jackson established the requirements for intervention as of right, and accordingly reversed the decision of the district court and remanded with directions to grant Jackson’s motion to intervene. View "Barnes v. Security Life of Denver" on Justia Law

Geico Marine filed suit seeking a declaration that a navigational limit in the policy with defendant that required the vessel to be north of Cape Hatteras, North Carolina, during hurricane season barred coverage. The district court ruled against Geico Marine and declared that the policy covered the loss.The Eleventh Circuit reversed and remanded, holding that the navigational limit barred coverage. In this case, the policy was not ambiguous about whether it contained a navigational limit when the loss occurred, and the plain language of the policy contained a navigational limit. Because the navigational limit was dispositive where the vessel suffered damage while outside the covered navigational area, the court need not address the breach of a duty of uberrimae fidei. View "Geico Marine Insurance Co. v. Shackleford" on Justia Law

In 1997, Suffolk Construction Company entered into a contract with the University of Connecticut (“UConn”) for the construction of several buildings on UConn’s campus. UConn secured insurance policies from Reliance Insurance Company for the Project, naming Suffolk (and other contractors) as an insured. Suffolk completed the work in January 2001. The Reliance insurance policy was extended until January 2004. However, in late 2001, however, Reliance went into liquidation. In 2013 and 2014, UConn complained of defects in the construction that resulted in damage to its buildings. UConn initiated legal proceedings against Suffolk and other contractors. In 2016, Suffolk submitted a proof of claim to the Insurance Commissioner of Pennsylvania, as the statutory liquidator of Reliance. At issue before the Pennsylvania Supreme Court in this case involved the Pennsylvania Commonwealth Court's interpretation of certain contract language using Connecticut law. The Commonwealth Court found that the language of the contract was clear and unambiguous, thus precluding consideration of extrinsic evidence of the parties’ intent. The Supreme Court determined, however, a Settlement Agreement between the parties could have been construed as nothing more than a mutual general release between UConn and Suffolk: "The ambiguity stems not from Suffolk’s 'subjective perception' of the terms of the Settlement Agreement, but from the terms of the agreement itself, as the language releasing claims for 'insurance coverage' and 'indemnification' does not have a single, clear meaning." As such, the Commonwealth Court erred by failing to consider extrinsic evidence, outside of the terms of the Settlement Agreement, to discern the parties’ intent. The Supreme Court therefore vacated the Commonwealth Court decision and remanded for further proceedings. View "Suffolk Constr. v. Reliance Ins." on Justia Law

Plaintiffs Steve and Pamela Zannini, appealed a superior court order granting summary judgment to defendant Phenix Mutual Fire Insurance Company, on plaintiffs’ breach of contract and declaratory judgment claims. In March 2016, the plaintiffs’ Ashland, New Hampshire residence sustained “significant flooding” as the result of burst pipes. The house was insured by defendant, and plaintiffs filed a claim for water damage. Defendant sent an adjuster to investigate, who instructed plaintiffs to remove the floor of the house so that he could investigate the area underneath. After they did so, the house began to collapse, and plaintiffs repaired its framing to prevent it from collapsing completely. As a result of removing the floor, plaintiffs “suffered a complete loss [of the house] and direct physical loss of [their] personal property and use of the [house] for a substantial amount of time.” On May 3, 2016, defendant sent the plaintiffs a letter denying coverage of the damage caused by the collapse. Plaintiffs argued on appeal to the New Hampshire Supreme Court that: (1) a provision in the insurance policy at issue requiring that suits be brought within one year of the date of loss was unenforceable because it violated public policy; and (2) genuine issues of material fact existed as to whether defendant’s communications tolled the one-year period, and defendant was estopped from asserting or waived it as a defense. The Supreme Court affirmed, finding the one-year limitation period did not violate the public policy underlying statutes of limitations. Further, the communications between the parties did not create issues of material fact as to whether the one- year period was tolled or whether the defendant waived or was otherwise estopped from asserting the provision as a defense. View "Zannini v. Phenix Mutual Fire Insurance Company" on Justia Law

The Supreme Judicial Court affirmed the decision of the superior court allowing Insurer's motion for summary judgment and dismissing Plaintiffs' action claiming that Insurer failed to effectuate a prompt, fair, and equitable settlement, holding that consent-to-settle clauses in professional liability policies do not violate Mass. Gen. Laws ch. 176D, 3(9)(f).Insurer issued a professional liability policy to Insured that contained a consent-to-settle clause. Plaintiffs sued Insured for engineering design errors in their house, and Insured refused to consent to settle. Plaintiffs then brought this action under Mass. Gen. Laws ch. 93A. The motion judge granted summary judgment in favor of Insured, concluding that the consent-to-settle clause in this case limited Insurer's ability to engage in further settlement practices with Plaintiffs once Insured refused to give Insurer consent to settle Plaintiffs' claims. The Supreme Judicial Court affirmed, holding that where Insurer made good faith efforts to investigate the claim and encourage Insured to settle and where Insurer's shortcomings did not proximately cause harm to Plaintiffs the superior court did not err in allowing Insurer's motion for summary judgment. View "Rawan v. Continental Casualty Co." on Justia Law

The Supreme Court affirmed the order of the circuit court granted summary judgment in favor of Shelter Mutual Insurance Company on Plaintiffs' claim arising from medical expenses they incurred following an automobile accident, holding that the trial court did not err in granting summary judgment.On appeal, Plaintiffs argued that the language in the relevant insurance policy was ambiguous or, in the alternative, the policy language was against public policy and should be declared void. The Supreme Court affirmed, holding (1) the applicable policy language was not ambiguous, and the policy was not against the public policy of the State of Arkansas; and (2) Plaintiffs' argument that the trial court erred in denying their motion in limine was moot. View "Crockett v. Shelter Mutual Insurance Co." on Justia Law

In 2014, Brian Shotts was injured in a car accident caused by Dana Pollard. Shotts was insured under a policy issued by GEICO General Insurance Company (“GEICO”), which included underinsured motorist (“UM”) coverage. Pollard had automobile insurance through Farmers Insurance (“Farmers”). Shotts filed a claim with Farmers, which offered Pollard’s policy limits as settlement. Before accepting the offer, Shotts notified GEICO of the accident. GEICO opened a claim, assigned an adjuster, and began an investigation. GEICO also waived its subrogation rights, allowing Shotts to accept the offer from Farmers. GEICO’s investigation determined that Shotts’s injuries exceeded Pollard’s policy limits by $3,210.87. GEICO offered Shotts a settlement of that amount, but Shotts declined the offer as “unreasonably low.” Shotts demanded GEICO promptly “pay the first dollar of his claim, up to the value of [the] claim or the total available UM limits” of $25,000. He also asked GEICO to reevaluate the offer. In response, GEICO requested additional information about Shotts’s injuries. It then proposed a peer review to determine whether his injuries exceeded the $3,210.87 offer. Shotts sued for bad faith breach of contract, alleging that GEICO acted in bad faith by: (1) conducting “a biased and unfair investigation and evaluation of [his] claim”; and (2) failing to pay the full value of his claim. He also requested punitive damages. The district court granted summary judgment for GEICO on both bad faith claims and denied punitive damages. Finding no reversible error, the Tenth Circuit affirmed the district court. View "Shotts v. GEICO" on Justia Law