Justia Insurance Law Opinion Summaries

Plaintiff Kevin Krohn suffered a severe spinal fracture that left him a paraplegic. Plaintiff brought suit under the state no-fault act seeking personal protection insurance benefits from Defendant Home-Owners Insurance Company to cover costs incurred for a surgical procedure performed in Portugal. The procedure was experimental and was not considered a generally accepted treatment for Plaintiff's injury. The issue before the Supreme Court was whether the experimental procedure was a reasonably necessary service for Plaintiff's care, recovery or rehabilitation under state law. Upon review of the record below, the Court concluded that if a medical treatment is experimental and not generally accepted within the medical community, an insured seeking reimbursement for the treatment must present objective and verifiable medical evidence to establish that the treatment was efficacious. In this case, the Court found the procedure was an "understandable" personal decision that offered Plaintiff only a medically unproved "possibility" for an efficacious result. The Court held the procedure was not an allowable expense for insurance reimbursement. The Court affirmed the appellate court that ruled in favor of Defendant.

Plaintiff was employed full time with Able Body Temporary Services, Inc. (Able Body), a labor broker in the business of furnishing its day-laborer employees to clients on a temporary basis. Able Body supplied its client, Federal Marine Terminals, Inc. (FMT), with day-laborers, including plaintiff, for longshore services. Plaintiff was subsequently injured on the job and received benefits under the Longshore and Harbor Workers' Compensation Act (LHWCA), 33 U.S.C. 901 et seq. Plaintiff, seeking to supplement his workers' compensation benefits, brought this negligence action against FMT, claiming that the negligence of FMT's employees caused his injury. At issue was whether the district court erred in holding that FMT was plaintiff's employer and that section 905(a) of the LHWCA precluded his negligence claim. The court held that because all the elements necessary for a borrowed-employment relationship were satisfied in light of the undisputed evidence, FMT was plaintiff's borrowing employer for purposes of the LHWCA and consequently, plaintiff's negligence claim was barred by section 905(a). Therefore, the judgment of the district court was affirmed.

This suit arose out of a dispute between a ship repair contractor, barge owner, and insurance company over the terms of a ship repair service contract and a maritime insurance policy. The contractor appealed from the district court's ruling that that the contractor breached its contractual obligation to procure insurance coverage for the barge owner and that it was contractually obligated to defend and indemnify the barge owner against damages ensuing from a workplace injury that occurred while the barge was being repaired. The barge owner cross-appealed from the district court's ruling that it was not entitled to additional insured coverage under the contractor's insurance policy. The court affirmed the district court's holding that there was a written agreement between the contractor and the barge owner which obligated the contractor to defend, indemnify, and procure insurance for the barge owner. The court also affirmed the district court's holding that the barge owner, which was not named in the policy, was not an additional insured under the policy. The court held, however, that the district court made no ruling regarding attorney's fees and therefore, the court remanded to the district court for a determination of the barge owner's entitlement, if any, to attorney's fees.

Plaintiff filed suit against Liberty Mutual, both personally and on behalf of a putative class of similarly situated individuals, alleging that the company's failure to disburse "medical payments" coverage (MedPay) benefits to her constituted a breach of contract, a breach of implied covenant of good faith and fair dealing, and a violation of G.L.c. 93A, 2. At issue was whether a claimant could seek medical expense benefits under the MedPay of a standard Massachusetts automobile insurance policy where she had already recovered for those expenses under a separate policy of health insurance. The court held that plaintiff's complaint and the extrinsic materials submitted by Liberty Mutual contained alleged facts sufficient to "raise a right to relief above the speculative level." The court also held that Liberty Mutual had not demonstrated as a matter of law that plaintiff could not receive MedPay benefits when she already had received medical expense benefits under her policy of health insurance. Accordingly, the order allowing Liberty Mutual's motion to dismiss was reversed and the matter remanded.

After defendant denied plaintiff's claim for long-term disability benefits (LTD benefits), where plaintiff suffered from fibromyalgia, plaintiff filed a complaint against defendant pursuant to ERISA, 29 U.S.C. 1000 et seq. At issue was whether the district court properly granted summary judgment in plaintiff's favor finding that defendant had abused its discretion in denying benefits to plaintiff. The court held that the district court improperly determined that defendant abused its discretion when it ultimately denied the LTD benefits claim. Based on the record, there was more than a scintilla of evidence supporting defendant's conclusion that plaintiff's condition did not render him "disabled" under the policy's any occupation definition and defendant's decision was supported by substantial evidence, where a reasonable person could have reached a similar decision. The court also held that the fact that defendant operated under a structural conflict of interest, as both plan administrator and insurer, did not warrant a finding that defendant abused its discretion in denying plaintiff's claim. Accordingly, the court reversed summary judgment and remanded for further proceedings.

Appellant, the named beneficiary of an accident benefits plan that her husband obtained through his employer, brought suit under ERISA, 29 U.S.C. 1001 et seq., alleging that the plan administrator, Metropolitan Life Insurance (Metlife), abused its discretion in determining that her husband was intoxicated at the time of the accident and denying coverage. At issue was whether the district court properly granted summary judgment to Metlife because Metlife's interpretation of the relevant policies was arbitrary and capricious and not supported by substantial evidence. The court held that Metlife did not abuse its discretion as plan administrator when it denied benefits based on the general exclusion for intoxication that appeared in the certificate of insurance. The court also held that the toxicology report, which concluded that the husband's blood alcohol level was above the state limit, constituted evidence that a reasonable mind might accept as adequate to support a conclusion and therefore, satisfied the substantial evidence standard. The court also held that because it agreed with the district court's conclusion that the denial of benefits was justified in light of the intoxication conclusion, it need not address Metlife's assertion that the husband's death was not accidental because it was reasonably foreseeable or, alternatively, the result of intentional self-inflicted injury. Accordingly, summary judgment was affirmed.

Appellees Floyd Demaray and James Hagemann were sued for repeated tortious activity in discharging of pollutants into lakes and streams of a nearby property. Appellees, who owned separate but identical insurance policies with De Smet Farm Mutual Insurance, notified De Smet of the lawsuit. De Smet declined defense of the suit, asserting it owed no duty to defend under the insurance contract. Appellees obtained their own defense counsel and defended the matter through trial, where a jury ruled in their favor. Appellees then sued De Smet, alleging that the company breached its duty to defend them in the previous lawsuit and seeking indemnification for all costs and fees incurred as a result. The trial court granted Appellees' motion for summary judgment, holding that De Smet owed Appellees a duty to defend because the alleged claim, if true, fell within policy coverage. On appeal, the Supreme Court reversed, holding that the policy language was unambiguous and the complaint asserted no claim that would arguably invoke coverage. Remanded with directions to grant summary judgment for De Smet.

This case arose out of an accident that occurred when a truck collided with the Casper family's minivan. The Caspers brought suit against several defendants, including the truck driver, his two employers, an employer CEO, and an employer's excess insurer. The Supreme Court granted review, affirming in part and reversing in part the decision of the court of appeals. The Court (1) affirmed the decision of the appellate court in finding the circuit court did not erroneously exercise its discretion in (a) finding excusable neglect and granting the insurer's motion to enlarge time by seven days to answer the amended complaint, and (b) denying the Caspers' motion for default judgment; (2) reversed the decision of the appellate court affirming the lower court's ruling that a liability insurance policy needs to be delivered or issued for delivery in Wisconsin in order to subject the insurer to a direct action under Wis. Stat. 632.24 and 803.04(2); and (3) affirmed that a corporate officer may be liable for non-intentional torts committed in the scope of his employment but reversed the decision of the appellate court because in this instance, the CEO's actions were too remote to provide a basis for personal liability.

Appellants, Peachtree Construction, Ltd. (Peachtree) and Great American Insurance Company (Great American), which was Peachtree's excess liability insurer, appealed the district court's grant of summary judgment in favor of Appellee, Colony Insurance Company (Colony), which was the primary liability insurer to Peachtree and Peachtree's subcontractor (CrossRoads). Great American also appealed the lower court's Fed. R. Civ. P. 12(b)(6) dismissal of its complaint in intervention. At issue was whether, under Texas law, an insurer's duty to indemnify an insured was subordinate to the insurer's duty to defend that insured and whether an excess liability insurer could maintain a subrogation claim against a primary liability insurer after the insured had been fully indemnified. The court held that, in light of D.R. Horton-Texas, Ltd. v. Market Int'l Ins. Co., the district court's summary judgment for Colony was both premature and incorrect where the proffered evidence was more that sufficient to raise a question of fact concerning the existence of a "causal connection relation" between CrossRoads' subcontracted work and the accident in the underlying suit. The court also held that Mid-Continent Ins. Co. v. Liberty Mut. Ins. Co. did not control Great American's contractual subrogation claim against Colony and therefore, the court vacated the district court's Rule 12(b)(6) order that dismissed Great American's complaint in intervention.

The Estate of Mable Dean Bradley (Estate) filed suit against defendants, excess insurers, in federal district court seeking recovery for defendants' alleged bad faith failure to indemnify the Mariner defendants in an underlying state lawsuit and settlement. At issue was whether the district court properly denied the Estate's motion for summary judgment against both insurers, finding as a matter of law that defendants' respective policies did not require them to defend or indemnify Mariner in the lawsuit. The court held that because the actual facts giving rise to liability in the underlying suit occurred outside of defendants' policies, neither excess insurer had a duty to indemnify Mariner for the judgment or settlement in the underlying state suit. Therefore, there could be no breach of denying coverage. The Estate's bad faith action failed as a matter of law. Accordingly, summary judgment was affirmed.