Justia Insurance Law Opinion Summaries

Alfa Insurance Corporation, Alfa Mutual General Insurance Corporation, Alfa Life Insurance Corporation, and Alfa Specialty Insurance Corporation (collectively, "Alfa") petitioned the Alabama Supreme Court for a writ of mandamus requiring the Montgomery Circuit Court to vacate its May 23, 2018, orders: (1) denying Alfa's motion for a protective order as to materials Alfa contended were protected by the attorney-client privilege; and (2) compelling Alfa to produce such materials for in camera inspection and for discovery. The underlying suit arose out of a policy dispute in which one side invoked an arbitration clause in the policy at issue. The insured claimed Alfa breached the policy by refusing to provide a defense and/or indemnity coverage. After review, the Supreme Court was satisfied Alfa established the trial court exceeded its discretion when it disregarded the attorney-client privilege and entered the May 2018 orders denying Alfa's motion for a protective order and compelling Alfa to produce the materials sought for in camera inspection or for discovery. Accordingly, the Supreme Court granted Alfa's petition for the writ of mandamus and directed the trial court to vacate the May 2018 orders denying Alfa's motion for a protective order and compelling Alfa to produce the materials at issue. View "Ex parte Alfa Insurance Corporation et al." on Justia Law

The Fifth Circuit affirmed the district court's judgment in favor of Principal in an action brought by plaintiff, alleging that Principal abused its discretion by denying her benefits. The court held that Principal's benefits denial was supported by substantial evidence. The court held that, at bottom, there was no abuse of discretion in Principal's reliance on its own treating physicians' reports detailing an absence of plaintiff's impairments. The court also held that, although Principal had a structural conflict of interest that it both evaluates and pays claims, this factor had little weight in light of the extensive investigation that Principal conducted. View "Foster v. Principal Life Insurance Co." on Justia Law

The Second Circuit affirmed the district court's order denying GEICO and CCC's motions to compel appraisal in a suit brought by a GEICO policyholder. The court held that it had jurisdiction over this appeal because it had appellate jurisdiction over an order denying a motion to compel arbitration and the appraisal process in the policy fell within the meaning of arbitration. The court held that appraisal was not appropriate in this case where the dispute concerned a legal issue about the meaning of Regulation 64, which was incorporated into the policy. Finally, the district court denied CCC's motion to compel appraisal because CCC was not a signatory to the policy and had no other contractual relationship with the policyholder. View "Milligan v. CCC Info Services" on Justia Law

The Covenants for Berkeley’s East Shore Commercial Condominiums Owners’ Association require it to maintain a master policy of all risk property insurance coverage, naming as insured the Association, the owners and all mortgagees. “Any insurance maintained by the Association shall contain [a] ‘waiver of subrogation’ as to the Association, its officers, Owners and the occupants of the Units and Mortgagees.” Article 13.4 prohibits an individual owner from obtaining fire insurance while allowing an owner to obtain individual liability insurance. The defendants leased a Commercial Condominium for a furniture manufacturing business. The Lease required the Lessee to maintain liability insurance, naming Lessor as an additional insured but did not specify which party would carry fire insurance. Western issued an insurance policy to Eastshore for the commercial properties; each owner was a named insured. A fire erupted in the condominium leased by defendants, damaging that and other units. Western paid for the fire damage then filed a subrogation complaint against defendants, alleging the fire was caused by their negligence. The trial court concluded that the Lease contemplated that the Western policy would be for defendants’ benefit so that subrogation was inappropriate. The court of appeal affirmed, concluding that defendants reasonably expected their landlord, an insured under the policy, to procure fire insurance. Western was barred from suing its own insured for negligently causing a fire, and the defendants were implied insureds under the policy, even if defendants were negligent. View "Western Heritage Insurance Co. v. Frances Todd, Inc." on Justia Law

Plaintiff appealed a judgment in favor of Farmers Insurance Exchange and Truck Insurance Exchange after the trial court determined that she was entitled to coverage under the Farmers policy as an heir of an insured under Insurance Code section 11580.2, subdivision (a)(1), but was not entitled to coverage under the Truck umbrella policy.The Court of Appeal affirmed the trial court's judgment and held that it properly ruled that plaintiff was not entitled to the uninsured motorist coverage under the Truck umbrella policy, because section 11580.2, subdivision (a)(1) did not modify the language of the Truck uninsured motorist endorsement and the endorsement governed who would be paid by Truck. The court also held that the trial court properly denied leave to file a second amended complaint; plaintiff was not entitled to coverage by estoppel; and the complaint failed to allege facts sufficient to justify reformation. View "Komorsky v. Farmers Insurance Exchange" on Justia Law

Lou Hodges submitted a claim for long-term-disability (LTD) benefits to Life Insurance Company of North America (LINA) through his employer’s group-insurance plan. Although LINA approved his claim, Hodges contended LINA should have classified him as a “sales” employee under the policy, which would have entitled him to more benefits. This led Hodges to sue LINA. The district court remanded for further factfinding, but LINA once again reached the same result. The district court then reversed LINA’s decision, concluding that Hodges qualified as a salesperson under the policy. LINA appealed, but finding no reversible error, the Tenth Circuit affirmed that ruling. View "Hodges v. Life Insurance Co." on Justia Law

The Second Circuit affirmed the district court's dismissal of plaintiffs' amended complaint under Federal Rule of Civil Procedure 12(b)(6). This appeal arose from a multitude of lawsuits filed by Connecticut homeowners whose basements walls were likely constructed with defective concrete manufactured by the now‐defunct J.J. Mottes Company.The court held that the "collapse" provision in the Allstate homeowner's insurance policy in this case did not afford coverage for basement walls that exhibit signs of deterioration but that have not collapsed suddenly, accidentally, and entirely, as required by the policy. Therefore, the horizontal and vertical cracking in plaintiffs' basement walls did not constitute a covered "collapse" under the policy and Allstate did not breach its contract by denying coverage for plaintiffs' claim. View "Valls v. Allstate Insurance Co." on Justia Law

After its workers’ compensation insurance premiums rapidly increased, Jackpot believed that Applied Underwriters had mishandled its claims and had wrongfully failed to disclose how it calculated premiums. Jackpot filed suit. Applied sought to compel arbitration based on the arbitration agreement contained in a Request to Bind. Jackpot argued that the arbitration agreement was invalid. Applied contended that, under the Federal Arbitration Act, only the arbitrator could decide the threshold question of whether the arbitration agreement was enforceable. The trial court held that the arbitration agreement was invalid. The court of appeal affirmed. In light of Jackson’s specific arguments that the arbitration provision was unenforceable due to fraud, ambiguity, and unconscionability, the trial court was obligated to consider its validity. Allied violated California law in issuing the Request to Bind without first submitting it for regulatory approval. The policy does not provide for arbitration but allows for administrative review by the Insurance Commissioner for certain disputes and otherwise leaves Jackpot’s rights to judicial review intact. The Request to Bind’s arbitration agreement, which compels arbitration in Nebraska for a wide array of disputes, materially changes the policy's dispute-resolution terms and constituted “a collateral agreement that should have been filed and endorsed to the Policy” under Insurance Code section 11658. View "Jackpot Harvesting, Inc. v. Applied Underwriters, Inc." on Justia Law

John Teets, a participant in an employer retirement plan, invested money in Great-West Life Annuity and Insurance Company’s investment fund which guaranteed investors would never lose their principal or the interest they accrued. The investment fund was offered to employers as an investment option for their employees’ retirement savings plans, which were governed by the Employee Retirement Income Security Act (“ERISA”). Teets later sued Great-West under ERISA, alleging Great-West breached a fiduciary duty to participants in the fund or that Great-West was a nonfiduciary party in interest that benefitted from prohibited transactions with his plan’s assets. After certifying a class of 270,000 plan participants like Mr. Teets, the district court granted summary judgment for Great-West, holding that: (1) Great-West was not a fiduciary; and (2) Mr. Teets had not adduced sufficient evidence to impose liability on Great-West as a non-fiduciary party in interest. Finding no reversible error in that judgment, the Tenth Circuit affirmed the district court’s judgment. View "Teets v. Great-West Life" on Justia Law

The Supreme Court accepted a question certified to it by the United States District Court for the District of Montana to address an Estate's third-party claim to stacked liability limits in an aircraft insurance policy that covered multiple aircraft, concluding that the answer to the question, which the Court reformulated, was no.The Supreme Court reformulated the question as follows: "Is the Estate of Darrell L. Ward entitled to stack the limits of liability coverage for three separate aircraft under the terms of an insurance policy issued to the pilot of an aircraft in which Ward was a passenger at the time it crashed?" The Supreme Court answered no to the reformulated certified question because (1) the plain, unambiguous language of the contract limits the coverage to the aircraft that is involved in the accident; (2) there is no public policy or statute that mandates payment of the cumulative coverage for separate aircraft in an aviation liability insurance policy that does not provide for such payment; and (3) the insurance policy at issue was not subject to stacking of its passenger liability coverages. View "U.S. Specialty v. Estate of Ward" on Justia Law