Justia Insurance Law Opinion Summaries

The issue before the Supreme Court in this case concerned the applicability of an assault and/or battery exclusion in a commercial general liability insurance policy. Great American E&S Insurance Company filed a declaratory-judgment action against its insured, End Zone Pub & Grill of Narragansett, Inc. and Defendant Michael Gondusky. Gondusky previously had filed a civil suit against End Zone alleging that he had been seriously injured by two doormen who were employed by End Zone. The Superior Court entered both an order granting Great American's motion for summary judgment and a declaratory judgment decreeing that Great American "owe[d] no duty to defend or obligation to indemnify relative to the underlying action brought by Michael Gondusky against End Zone * * *." Gondusky appealed the Superior Court’s judgment. This case came before the Supreme Court pursuant to an order directing the parties to show cause why the issues raised in this appeal should not summarily be decided. After considering the parties' written and oral submissions and reviewing the record, the Court concluded that cause had not been shown and that this case could be decided without further briefing or argument. The Court affirmed the judgment of the Superior Court. View "Great American E&S Ins. Co. v. End Zone Pub & Grill of Narragansett, Inc. " on Justia Law

Plaintiff-Appellee William Mohr was struck in Delaware as a pedestrian by a car insured in Delaware. He recovered the minimum $15,000 coverage limit from the carrier that insured the striking car. Plaintiff also sought to recover from Defendant-Appellant Progressive Northern Insurance Company which sold an automobile insurance policy to Plaintiff's mother. Under the policy, Plaintiff's mother was the named insured, and Plaintiff was a member of her household. The Progressive policy, by its terms, did not cover Plaintiff as a pedestrian. The superior court held nonetheless that Plaintiff was entitled to recover under Progressive's policy because insofar as it denied PIP coverage, the policy conflicted with the Delaware automobile insurance statute which mandated such coverage. Progressive appealed. The court ordered Progressive to pay the difference between the amount Plaintiff recovered from the striking-car's policy and PIP limit of his mother's policy. Finding no error in the superior court's decision, the Supreme Court affirmed. View "Progressive Northern Insurance Co. v. Mohr" on Justia Law

The issue before the Supreme Court concerned the extent of uninsured motorist coverage provided under an automobile insurance policy issued to a husband and wife who were both injured by an uninsured motorist while riding their motorcycle. The husband, Leo Fontaine, died as a result of his injuries. The motorcycle in question was not expressly identified in the policy at issue. Plaintiff-Insurer New London County Mutual Insurance Company (NLC) filed suit for declaratory relief seeking clarification of the rights and obligations of the parties pursuant to their policy issued to the couple. Arguing that the policy language unambiguously excluded the defendants' claim for uninsured motorist benefits, NLC filed a motion for summary judgment, which was granted by the Superior Court. Defendants Karolyn Fontaine, individually and on behalf of the estate of her husband, Leo appealed the grant of summary judgment and contended that the pertinent policy provision was ambiguous and should have been construed in favor of coverage. Upon review, the Supreme Court held that the policy language explicitly excluded Defendants' claims from coverage. Accordingly, the Court affirmed the superior court's judgment. View "New London County Mutual Ins. Co. v. Fontaine" on Justia Law

Defendant-Appellee McKinley Hyten obtained a provisional driver's license in April 2004. In January 2007, Defendant's driver's license was suspended because of multiple moving violations and two minor traffic accidents. In light of what she perceived as assurances from her probation officer, Defendant anticipated that her license would be restored at a district court hearing scheduled for later that year. Defendant's mother Anne Johnson gave Defendant a vehicle, and given the anticipated restoration of the driver's license, sought to obtain automobile insurance for Defendant. Johnson telephoned an independent insurance agent who, after being told that the license had been suspended, informed Johnson that Defendant could not be insured until her license had been restored. Nonetheless, an application for insurance from Titan Insurance Company was filled out on Defendant's behalf, postdated to August 24, 2007. August 22, 2007, Defendant signed the application for insurance. At an August 24, 2007, hearing, Defendant's driver's license was not restored. Plaintiff-Appellee Titan Insurance Company was not informed of this fact. Subsequently, in February 2008, Defendant was driving the insured vehicle and collided with the vehicle of Howard and Martha Holmes, causing injuries to both. Titan then learned Defendant did not have a valid driver's license when the policy was issued. In anticipation that the Holmeses would be filing claims against Defendant for their injuries, Titan filed suit seeking a declaratory judgment. The trial court granted Defendant's motion for summary judgment. The Court of Appeals affirmed, asserting that once an insurable event occurred and a third party (the Holmeses) possessed a claim against the insured arising out of that event, the insurer was not entitled to reform the policy to avoid paying the third party. Titan appealed, and the Supreme Court reversed the Court of Appeals: in accordance with the Supreme Court's precedent in "Keys v Pace,"(99 NW2d 547 (1959)), the Court found "nothing in the law to warrant the establishment of an 'easily ascertainable' rule." The Court overruled "State Farm Mut Auto Ins Co v Kurylowicz," (242 NW2d 530 (1976)) and its progeny, and remanded the case for further proceedings. View "Titan Ins. Co. v. Hyten" on Justia Law

Plaintiff sustained a serious brain injury when he fell while climbing down from the roof of a residence while working for EWES. At the time of the accident, EWES held a commercial liability insurance policy issued by Maxum. Maxum denied coverage and refused to defend, citing the policy's Employer Liability Exclusion. After plaintiff obtained a negligence judgment against EWES, he filed suit against Maxum pursuant to an assignment of claims from EWES, asserting breach of the duty to defend and seeking indemnification. The court reversed as to the notice issue, finding that Maxum waived its right to assert a defense based on untimely notice because it did not properly alert EWES that the lack of timely notice would be a potential bar to coverage. The court also reversed the Court of Appeals' decision regarding Maxum's duty to defend, finding that since Maxum waived its right to assert a defense related to EWES' failure to give timely notice of the occurrence, timely notice of the occurrence was not a prerequisite to Maxum's duty to defend. View "Hoover v. Maxum Indemnity Co." on Justia Law

Respondents Kelly Rhoden and her daughters, Ashley Arrieta and Emerlynn Dickey, were involved in a motor vehicle accident while riding in a vehicle owned and operated by Arrieta. The parties stipulated that the Respondents are relatives residing in the same household, and that Arrieta's insurance policy with Nationwide did not provide UIM coverage. Rhoden owned two vehicles that she also insured through Nationwide under a policy that did provide UIM coverage. Rhoden's policy contained a term specifying that the insurance it provided was primary when the covered vehicle was involved in the accident but excess when the involved vehicle was not the covered vehicle but was owned by the policyholder or a resident relative. Nationwide brought a declaratory judgment action seeking a determination that UIM coverage was not available to any of the Respondents under Rhoden's policy. Nationwide contended that because Arrieta's policy had no UIM coverage, clause 3(b), a portability limitation clause, operated to prevent any Respondent from recovering under Rhoden's policy. The trial court held that UIM coverage under Rhoden's policy was available to all three Respondents because such coverage is personal and portable, and Respondents were either named insureds or resident relatives under Rhoden's policy. Nationwide appealed the decision to the court of appeals, which reversed the trial court with regard to Arrieta, and affirmed the trial court's ruling that UIM coverage was available to Rhoden and Dickey under Rhoden's policy. The issue on appeal to the Supreme Court was whether public policy was offended by the portability limitation clause preventing non-owner resident relatives from importing UIM coverage from an at-home vehicle's policy when the involved vehicle lacked UIM coverage. The Supreme Court held that South Carolina's public policy that UIM coverage is personal and portable requires UIM coverage to be provided to Rhoden and Dickey, who did not own the vehicle involved in the accident, while denied to Arrieta, who owned the vehicle involved in the accident but chose not to purchase UIM coverage. The Court affirmed the court of appeals' decision.

This case arose when a tower crane operated by Joy collapsed during construction of a high-rise condominium, killing seven people and injuring dozens, damaging several buildings and destroying one. At issue was the dispute in coverage under the excess policy for "additional insureds" within the meaning of the comprehensive general liability (CGL) policy. The court concluded that there were material issues of fact in this case as to whether the high-rise building under construction was residential or mixed-use; Admiral's other claims related to Joy's alleged misrepresentations in its underwriting submission were properly interposed against Reliance and the owners/developers as well as Joy; the LLC exclusion did not foreclose coverage of those owners/developers that were limited liability companies; and defendants' remaining arguments were without merit. Accordingly, the court held that the order of the Supreme Court, as modified by the Appellate Division, was not properly made.

Plaintiff brought suit against Deerbrook for breach of the implied covenant of good faith and fair dealing. Plaintiff was injured in an accident caused by Deerbrook's insured and after plaintiff received a judgment against the insured, the insured assigned his bad faith claim to plaintiff. Plaintiff argued that Deerbrook breached the implied covenant of good faith and fair dealing owed to its insured when Deerbrook did not attempt to reach a settlement of plaintiff's claims after the insured's liability in excess of the policy limit became reasonably clear. Plaintiff subsequently appealed the district court's rejection of his request to instruct the jury that it could consider Deerbrook's failure to effectuate a settlement in determining whether Deerbrook breached the implied covenant. The court concluded that plaintiff's proposed jury instruction was consistent with the law but that there was no evidentiary basis for the instruction. Accordingly, the court affirmed the judgment.

Mid-Continent appealed the district court's final judgment that it had a duty to indemnify Davis Construction in the underlying wrongful death action brought by the family of decedent Jorge Serrato. The court affirmed the district court's ruling, finding that the district court did not abuse its discretion in determining that Serrato was an independent contractor and not an employee of Davis Construction.

Stryker, a manufacturer of medical devices, sued its umbrella insurer XL, seeking coverage for claims stemming from the implantation of expired artificial knees. The dispute concerned the precise "defect" that triggers batch coverage under the Medical Products Endorsement. The district court held that XL was liable under the policy for the entirety of Stryker’s losses on both direct claims brought against Stryker, as well as claims brought against Pfizer that Stryker was obligated to reimburse under an asset purchase agreement. The court found that the items were defective if they were available in Stryker’s inventory for implantation by physicians beyond their shelf-life of five years. The Sixth Circuit affirmed XL’s liability for the full amount of Stryker’s losses and pre-judgment interest. XL’s payment to Pfizer applies to exhaust the policy with respect to the direct claims. The court reversed the holding that the aggregate limit of liability of the XL policy does not apply to the judgments on the direct claims and remanded for determination of what portion, if any, of the total liability for those judgments beyond $15 million represents consequential damages as defined under Michigan contract law.