Justia Insurance Law Opinion Summaries

The Supreme Court vacated the decision of the court of appeals reversing the decision of the district court affirming the Polk County assessor's original tax valuation of two large corporate office buildings in downtown Des Moines at $87,050,000 and $44,910,000, holding that the district court did not err by relying on the Board's expert appraisers when it affirmed the assessor's valuation.Nationwide Mutual Insurance Co., the owner of the buildings at issue, protested the valuation, and the Polk County Board of Review upheld the valuation. The district court affirmed the assessment after hearing appraisers appointed by both the Board and Nationwide as expert witnesses and finding the Board's experts more reliable. The court of appeals reversed and reduced the assessments. The Supreme Court vacated the appellate court's decision and affirmed the judgment of the district court holding (1) there was no basis to reject the district court's determination about the relative reliability of the expert witness testimony; and (2) the Board met its burden to prove that the valuation was not excessive. View "Nationwide Mutual Insurance Co. v. Polk County Board of Review" on Justia Law

Pursuant to an arbitration award, American Home paid workers’ compensation benefits to an employee injured in 2008. American did not file a notice before the arbitration that, pursuant to Iowa Code 85.21, it was paying the claim subject to a potential coverage issue. By 2013, American paid all the benefits owed under the arbitration award. In 2016, the employee sought to reopen the case. American then filed a section 85.21 notice seeking reimbursement of benefits paid to the employee, claiming that on the date of injury Liberty Mutual was providing the employer with workers’ compensation coverage.The workers’ compensation commissioner concluded that in order to be entitled to reimbursement, American was required to file section 85.21 notice before the arbitration proceeding and could not, years later, seek to be reimbursed. The district court reversed, reasoning that section 85.21 gave the commissioner broad power to order reimbursement, not time-limited in the statute. The court of appeals, agreeing with the commissioner, reversed. The Iowa Supreme Court agreed. The commissioner may require that insurance carriers obtain a section 85.21 reimbursement order before an evidentiary hearing in order to seek indemnity or contribution from another carrier. The procedural question is not controlled by the substantive provisions of section 85.21. The commissioner has simply established a rule of procedure for handling section 85.21 claims. View "American Home Assurance v. Liberty Mutual Fire Insurance Co." on Justia Law

The Supreme Court affirmed the order of the district court granting summary judgment in favor of Insurer in this insurance dispute, holding that summary judgment was properly granted.Insured, which operated a bar and restaurant, made a claim under its commercial property insurance policy for business interruption coverage for the period it closed its business in response to the order of the West Virginia Governor that bars and restaurants shut down in response to the COVID-19 pandemic. Insurer denied the claim. The Supreme Court affirmed, holding (1) the language "direct physical loss of or damage to Covered Property" requires a physical aspect to the property loss before coverage is triggered; and (2) Insured's claim failed under the provision that required actual damage to nearby property. View "Jesse’s Embers, LLC v. Western Agricultural Insurance Co." on Justia Law

The Supreme Court affirmed the order of the district court granting summary judgment in favor of an Insurer in this insurance dispute, holding that the mere loss of use of business property did not constitute "direct physical loss of or damage to property" to trigger coverage in this case.Insured, which operated a private golf and country club, made a claim under its all-risk commercial property insurance policy for income it lost during the time it temporarily closed its facilities in compliance with the Governor's 2020 proclamation restricting in-person services at bars and restaurants in response to the COVID-19 pandemic. Insurer denied the claim, and Insured sued. The district court granted Insurer's motion for summary judgment. The Supreme Court affirmed, holding that the mere loss of use of business property does not constitute “direct physical loss of or damage to property” to trigger coverage under the business interruption endorsement to an all-risk commercial property insurance policy like the one at issue in this case. View "Wakonda Club v. Selective Insurance Co. of America" on Justia Law

The Supreme Court reversed the district court's judgment denying Insurer's motion for directed verdict on this action concerning Insurer's alleged delay in paying a claim, holding that the district court erred in denying the motion for directed verdict on Insured's breach of contract and bad faith causes of action.A fire broke out in Insured's kitchen that resulted in a total loss of the building and its contents. Insured invoked its right to the appraisal process. The appraisers signed an appraisal letter establishing the loss amount at $502,000. Insurer paid the amount in full. Eight months later, Insured sued Insurer for breach of contract and bad faith based on Insured's failure to pay the $550,000 building coverage limit and for its actions during the appraisal hearing. The jury returned a verdict in favor of Insured and awarded $48,000 in damages. The Supreme Court reversed, holding (1) Insured's invocation of the appraisal process and Insurer's timely payment of the appraisal award required dismissal of the claims as a matter of law; and (2) Insured failed to prove bad faith for any actions taken after the appraisal hearing. View "Luigi's Inc. v. United Fire & Casualty Co." on Justia Law

The Supreme Court affirmed in part and reversed in part the judgment of the district court holding that a commercial general liability (CGL) policy and a related excess liability declaration do not cover claims brought by the estate and spouse of an employee who was fatally injured while working for Adventureland Amusement Park, holding that the district court erred in granting summary judgment.The decedent was serving as a loading assistant on a river ride when he was fatally injured. The decedent's estate and his widow filed a district court action, later removed to federal court, alleging that the decedent's injuries were a result of grossly negligent acts by the ride's operator, the decedent's coemployee. The insurer filed a declaratory action in state court seeking a declaration that it had no duty to defend or indemnify the coemployee in the federal action. The district court granted summary judgment for the insurer. The Supreme Court reversed in part, holding that there remained a question of fact as to whether the estate has a claim that amounts to gross negligence but is within the scope of the coverage of the CGL policy. View "T.H.E. Insurance Co. v. Estate of Booher" on Justia Law

The Supreme Court affirmed the decision of the district court granting summary judgment in favor of an insurer on the grounds that the plaintiff's contractual assignment was unenforceable, holding that a residential contractor acting as an unlicensed public adjuster cannot enforce its post-loss contractual assignment of insurance benefits against the homeowner's insurer.The contractor in this case represented homeowners as an assignee of their insurance claim for storm damage to their home. The district court concluded that the contractor's contractual assignment was invalid because the contractor acted as an unlicensed public adjuster. The Supreme Court affirmed, holding that the district court did not err in ruling that the contractor acted as an unlicensed public adjuster and that the assignment contract was void and unenforceable under Iowa Code 103A.71(5). View "33 Carpenters Construction, Inc. v. IMT Insurance Co." on Justia Law

The Supreme Court affirmed the district court's grant of summary judgment for an insurer on the grounds that the plaintiff's contractual assignment was unenforceable, holding that a residential contractor acting as an unlicensed public adjuster cannot enforce its postloss contractual assignment of insurance benefits against the homeowner's insurer.Iowa Code 103A.71(5) declares void contracts entered into by residential contractors who perform public adjuster services without the license required under Iowa Code 522C.4. The contractor in this case represented homeowners as an assignee of their insurance claim for hail damage to their home. The district court concluded that the contractor's contractual assignment was invalid under section 103A.71(5) because the contractor acted as an unlicensed public adjuster. The Supreme Court affirmed, holding that the district court did not err in ruling that the contractor acted as an unlicensed public adjuster and that the assignment contract was unenforceable and void under Iowa law. View "33 Carpenters Construction, Inc. v. State Farm Fire & Casualty Co." on Justia Law

The Supreme Court affirmed the decision of the court of appeals affirming the district court's grant of summary judgment in favor of Cincinnati Insurance Company in this insurance dispute, holding that, for the reasons set forth in 33 Carpenters Construction, Inc. v. State Farm Life & Casualty Co., __ N.W.2d __ (Iowa 2020), an assignment contract entered into by a residential contractor acting as an unlicensed public adjuster is void under Iowa Code 103A.71(5).After a hailstorm and windstorm damaged Gregg Whigham's residence, Whigham and 33 Carpenters Construction, Inc. entered into an agreement under which 33 Carpenters would repair the damage in exchange for Wigham's insurance proceeds. A 33 Carpenters representative and Whigham then signed an assignment of claim and benefits. Later, 33 Carpenters sued Whigham's insurer, Cincinnati, claiming that Cincinnati breached the insurance policy by failing to by 33 Carpenters all benefits due and owing under the policy that had been assigned to it. The district court granted summary judgment to Cincinnati, concluding that the purported assignment of Whigham's insurance claim was invalid. The Supreme Court affirmed, holding that because 33 Carpenters was operating as an unlicensed public adjuster, the assignment contract was unenforceable. View "33 Carpenters Construction, Inc. v. Cincinnati Insurance Co." on Justia Law

The Supreme Court affirmed the judgment of the district court entering judgment against a commercial general liability (CGL) insurer on a homeowners’ insurer’s lawsuit seeking reimbursement for the amount it paid to settle a death claim, holding that the district court correctly interpreted the CGL insurance contract, and substantial evidence supported the court’s factual findings on potential liability and the reasonableness of the settlement.A dentist and his wife formed a limited liability company (LLC) that held title to investment properties, including a farmhouse. An accidental shooting at the farmhouse resulted in a death, and a death claim followed. The dentist had purchased homeowners liability insurance and CGL insurance from separate insurers. The CGL insurer denied coverage. The homeowners’ insurer settled the death claim for $900,000. Thereafter, the homeowners’ insurer filed this action seeking subrogation from the CGL insurer. The district court entered judgment against the CGL insurer for $450,000. The Supreme Court affirmed, holding that the LLC, as owner of the farmhouse, had potential liability under a premises liability theory for a dangerous condition and that the CGL insurer, as coinsurer of the farmhouse property, was obligated to indemnify the homeowners’ insurer for half of the $900,000 settlement. View "Metropolitan Property & Casualty Insurance Co. v. Auto-Owners Mutual Insurance Co." on Justia Law