Justia Insurance Law Opinion Summaries

The City of Richmond Heights, Missouri filed a claim with Mt. Hawley Insurance Company under a commercial property policy for losses of tax revenue due to government-mandated COVID-19 closures. Mt. Hawley denied the claim and sued for a declaratory judgment that it was not obligated to cover the losses. Richmond Heights counterclaimed with five counts: (1) breach of contract, (2) vexatious refusal to pay, (3) fraudulent inducement and misrepresentation, (4) negligent misrepresentation, and (5) breach of fiduciary duty. The United States District Court for the Eastern District of Missouri dismissed the counterclaims, denied amendments to two of them, and granted declaratory judgment to Mt. Hawley. On appeal, the United States Court of Appeals for the Eighth Circuit affirmed the decision of the lower court.The appellate court held that the insurance policy required "direct physical loss of or damage to property" for coverage which was not met by the COVID-19 shutdowns. The court also rejected the city's argument that the Additional Covered Property Endorsement in the policy removed the "physical damage or loss" requirement for losses of sales tax revenues. Furthermore, the court found that the city's claims of fraud, misrepresentation and breach of fiduciary duty were not distinct from its breach of contract claim and thus were properly dismissed by the district court. Lastly, the court affirmed the district court's denial of the city's motion to amend its breach of contract and vexatious refusal claims, concluding that the proposed amendments would not have survived a motion to dismiss. View "Mt. Hawley Insurance Company v. City of Richmond Heights" on Justia Law

In the case of Brett Lane v. the State of Alaska, Department of Family & Community Services, Office of Children’s Services, the Supreme Court of the State of Alaska affirmed the lower court's decision denying the Office of Children's Services's (OCS) post-trial motion for a new trial on liability. The court concluded that the weight of the evidence supported the jury's verdict on Lane's theories of retaliation. However, the court found an error in the jury instruction relating to noneconomic damages caused by a dangerous client, Wilson. As a result, the court vacated the damages judgment and remanded for a new trial solely on noneconomic damages. The court also remanded the matter back to the lower court for an evidentiary hearing on OCS's claim that the jury award duplicated workers’ compensation benefits that Lane received. The court held that OCS should be given the opportunity to prove that the jury award created an impermissible duplication of damages. View "State of Alaska v. Lane" on Justia Law

Marshall Sandlin, a laborer at Mid American Construction LLC, suffered an injury to his left foot during work. After an initial medical examination conducted by a physician chosen by Mid American's insurance carrier, Grinnell Mutual, Sandlin underwent another independent medical examination (IME) by a physician of his choosing. Sandlin sought reimbursement for the full cost of this second examination, as he believed the first examination's evaluation was too low.The Supreme Court of Iowa had to decide whether an amendment to Iowa Code section 85.39(2) in 2017 limited an employee's reimbursement for an IME to only the cost of the impairment rating or included the full cost of the examination. The court held that the employee is eligible for reimbursement of the reasonable cost of the full examination to determine the impairment rating, not merely the cost of the impairment rating itself. The court interpreted the term "examination" as used in the statute to include review of medical records, physical examination, testing, and written report.However, the court found that the commissioner's analysis of the physician's fee as reasonable was incomplete. While the commissioner considered the physician's written opinion about the reasonableness of his fee, the commissioner failed to analyze the typical fee charged for such an examination in the local area where the examination was conducted, as required by the 2017 amendment to the statute. Consequently, the court remanded the case for further fact-finding on the issue of the reasonableness of the fee based on the typical fee charged in the local area.Thus, the Supreme Court of Iowa affirmed in part and vacated in part the decision of the Court of Appeals and affirmed in part, reversed in part, and remanded the judgment of the District Court. View "Mid American Construction LLC v. Sandlin" on Justia Law

In the United States Court of Appeals for the Eleventh Circuit, the Court reviewed a case involving the estates of two patients who passed away after undergoing liposuction procedures at CJL Healthcare, LLC in Georgia. After the patients' deaths, their estates filed lawsuits against the clinic and its doctor. The clinic's insurer, Prime Insurance Co., defended the clinic under a reservation of rights but ultimately withdrew its defense after the costs of defending the lawsuits exhausted the insurance coverage.The estates of the patients and the clinic then filed a lawsuit against the insurers, Prime Insurance Co., Prime Holdings Insurance Services, and Evolution Insurance Brokers, claiming they had breached their duties, contract, and acted negligently. They also claimed the insurers had unlawfully sold surplus lines insurance. The district court dismissed the case, and the plaintiffs appealed.The Court of Appeals affirmed the district court's decision. The Court held that the policy unambiguously provided a $50,000 limit for a single professional liability claim and a $100,000 aggregate limit for all claims. The Court further held that the insurers' duty to defend the clinic ended when the policy limits were exhausted by payment of damages and claim expenses. The Court also affirmed the district court's finding that the Georgia Surplus Lines Insurance Act did not provide a private cause of action for the unauthorized sale of surplus lines insurance. View "Jumlist v. Prime Insurance Co." on Justia Law

In the Supreme Court of Wyoming, an appeal by Ronald Pinther, a former insurance agent, was dismissed. Pinther had worked for American National Property and Casualty Insurance Company (ANPAC) and American National Insurance Company (ANICO). He filed a lawsuit against ANPAC, ANICO, and another agent, Philip Maggard, claiming breach of contract, breach of good faith and fair dealing, fraudulent inducement, promissory estoppel, civil conspiracy, and age discrimination. The district court granted summary judgment in favor of ANPAC and Mr. Maggard. On appeal, the Supreme Court held that the district court had not erred in its decision. The court found that Mr. Pinther's breach of contract claim against ANPAC was governed by the Post-Termination Compensation Schedule outlined in the agent agreement. The court further held that Mr. Pinther's claim of a breach of an implied duty of good faith and fair dealing could not be maintained given the at-will nature of the agency contract. The court also dismissed Mr. Pinther's fraudulent inducement claim against ANPAC, noting that the recruiting brochure did not govern his agreement with ANPAC. The court further held that Mr. Pinther's claim for tortious interference with a contract against Mr. Maggard could not be maintained as the actions of Mr. Maggard, as an agent of ANPAC, were imputed to ANPAC. Lastly, the court held that Mr. Pinther's civil conspiracy claims against ANPAC and Mr. Maggard failed as the underlying tort claims did not survive summary judgment. View "Pinther v. American National Property and Casualty Insurance Company" on Justia Law

In this case, a group of healthcare providers (Providers) sued the insurer Sanford Health Plan, Inc. (SHP) for excluding them from participating in some of its health benefit plans. The Providers argued that according to South Dakota’s “Any Willing Provider” law (SDCL 58-17J-2), they had the right to participate as panel providers in all of SHP's plans. The law stipulates that a health insurer cannot block patient choice by excluding a willing and qualified healthcare provider from its panel of providers if the provider is within the geographic coverage area of the health benefit plan. The circuit court determined that the law did not permit SHP to exclude a qualified and willing healthcare provider from participating in every health benefit plan it offered, granting summary judgment in favor of the Providers.The Supreme Court of the State of South Dakota affirmed the circuit court's decision. It interpreted the law as plan-specific, meaning an insurer may not exclude any willing and fully qualified provider from any of its plans or from any tier within a plan. It also clarified that an insurer may still exclude providers from plans if they do not meet the statutory requirements for participation as a panel provider. The court concluded that, according to the law, SHP could not exclude the Providers from participating in its TRUE Plan or Tier 1 of the PLUS Plan, thus affirming the circuit court's granting of summary judgment in favor of the Providers. View "Orthopedic Institute v. Sanford Health Plan, Inc." on Justia Law

In this case, the United States Court of Appeals for the Eighth Circuit affirmed the lower court's decision that the Pacific Life Insurance Company did not owe benefits to Katie Blevins, the beneficiary of a life insurance policy taken out by her late fiancé, Dr. Travis Richardson. Richardson applied for a life insurance policy and paid the first month's premium three days before he died. He did not sign the received policy or any required amendments. Blevins claimed that the policy was in effect at the time of Richardson's death, despite the policy not being physically delivered or formally accepted. Blevins also brought claims of bad faith, promissory estoppel, and apparent authority against the insurance company. In its decision, the court stated the policy was clear in its conditions, which required physical delivery and acceptance before the policy was in force. The court found these conditions were not met, as the policy was neither delivered nor accepted by Richardson before his death. Therefore, no death benefit was owed. As a result, Blevins' bad faith claim was also dismissed, as the insurer could not have acted in bad faith if there was no obligation to pay out the policy. View "Pacific Life Insurance Company v. Blevins" on Justia Law

Cynthia Bowen purchased an insurance policy from Farm Bureau Property & Casualty Insurance Company ("Farm Bureau") for her pick-up truck. She was injured when an employee of Menard, Inc. ("Menards") accidentally dropped a large board on her while helping load her truck at a store. Bowen sued Menards for damages, alleging negligence. Menards then filed an action against Farm Bureau seeking a declaratory judgment that it was entitled to a defense and indemnification from Farm Bureau under Bowen's insurance policy. The district court ruled in favor of Menards, finding that Menards and its employee were covered insureds under the policy and that no policy exclusion applied.On appeal, the United States Court of Appeals for the Eighth Circuit reversed the district court's decision. The court concluded that the policy's "Intrafamily Immunity" exclusion applied to the case. This exclusion stated that there was no coverage for any bodily injury to any "insured," which, in this case, included both Bowen and Menards. Therefore, the policy provided no liability coverage for Bowen's claim against Menards, another insured party. The court rejected the district court's reasoning that the term "intrafamily" limited the application of the exclusion, finding that the plain meaning of the operative policy provision prevailed. The court also rejected Menards' argument that Farm Bureau was estopped from asserting this defense to coverage. Consequently, the court reversed the district court's judgment, ruling that Farm Bureau was not obligated to provide defense and indemnification for Menards in connection with the lawsuit brought by Bowen. View "Menard, Inc. v. Farm Bureau P&C Ins. Co." on Justia Law

In the case before the Supreme Court of the State of Hawai‘i, the issue was whether a subrogee insurance company, which timely intervened pursuant to HRS § 386-8(b), has an independent right to continue to pursue claims and/or legal theories against a tortfeasor that were not asserted by the subrogor employee, after summary judgment has been granted against the subrogor employee, on the subrogor employee’s claims. This case involved Hyun Ju Park, a bartender who was shot by an off-duty Honolulu Police Department officer while at work. Park sued the City and County of Honolulu, alleging negligence and other claims. Dongbu Insurance Co., Ltd., the workers' compensation insurance carrier for Park's employer, intervened in the case, alleging additional negligence claims that Park had not raised. The City moved to dismiss all of Park’s claims and some of Dongbu's claims, which the court granted, leaving two of Dongbu's claims - negligent supervision and negligent training - remaining. The City then moved for summary judgment against Dongbu, arguing that since Park's claims were dismissed, Dongbu's claims also failed.The Supreme Court of Hawai‘i held that a subrogee insurance company, which timely intervened, does have an independent right to continue to pursue claims and/or legal theories against a tortfeasor that were not asserted by the subrogor employee, even after summary judgment has been granted against the subrogor. The court reasoned that an affirmative answer protects subrogation, aligns with Hawai‘i’s workers’ compensation subrogation law, and does not undermine employers’ and insurers’ intervention rights. The court also rejected the City's claim preclusion argument, stating that Dongbu's remaining claims for negligent supervision and negligent training had not yet been decided and were not barred by res judicata. Therefore, Dongbu may continue to pursue its non-dismissed claims. View "Park v. City and County of Honolulu" on Justia Law

This case involves a dispute between a homeowner, Mario Rodriguez, and his insurance company, Safeco Insurance Company of Indiana. After a tornado damaged Rodriguez's home, Safeco issued a payment of $27,449.88, which Rodriguez accepted. Rodriguez's counsel then informed Safeco that it owed an additional $29,500 and threatened to sue. Rodriguez sued Safeco, bringing several claims, including breach of contract and statutory claims under the Insurance Code. Safeco invoked the insurance policy’s appraisal provision and subsequently issued a check to Rodriguez for $32,447.73, which it viewed as full payment of the appraisal amount due under the policy. Safeco also paid an additional $9,458.40, which it claimed would cover any interest possibly owed on the appraised amount.The Supreme Court of Texas was asked to answer a certified question from the United States Court of Appeals for the Fifth Circuit: “In an action under Chapter 542A of the Texas Prompt Payment of Claims Act, does an insurer’s payment of the full appraisal award plus any possible statutory interest preclude recovery of attorney’s fees?” The Supreme Court of Texas held that the answer is yes. When an insurer has fully discharged its obligations under the policy by voluntarily paying the appraised amount, plus any statutory interest, in compliance with the policy’s appraisal provisions, section 542A.007 of the Insurance Code prohibits an award of attorney’s fees. This is because there is no remaining “amount to be awarded in the judgment to the claimant for the claimant’s claim under the insurance policy,” which means no attorney’s fees are available under section 542A.007(a)(3)’s formula. View "RODRIGUEZ v. SAFECO INSURANCE COMPANY OF INDIANA" on Justia Law