Justia Insurance Law Opinion Summaries

In this case arising the death of James Savage after he was thrown from his motorcycle and run over by Oscar Ramos, the Supreme Court affirmed in part and reversed in part the judgment of the court of appeals remanding this case back to the circuit court for a new trial, holding that remand was required under the circumstances.Specifically, the Supreme Court held (1) Property & Casualty Insurance Company of Hartford was not the owner of the Jeep Wrangler at issue according to Ky. Rev. Stat. 186A.530(3), and Co-part of Connecticut, Inc. was required to obtain proof of insurance pursuant to sections 186A.215 and 186A.220; (2) the court of appeals improperly engaged in fact-finding that affected its judgment on other issues; (3) the court of appeals erred in ruling that the trial court abused its discretion by allowing Co-part to withdraw an admission; (4) strict liability does not apply as a matter of law for violations of Ky. Rev. Stat. 186A.500; and (5) Aull v. Houston, 345 S.W.3d 232 (Ky. App. 2010) is hereby abrogated to the extent that it can be read to hold that Social Security Disability benefits are inadmissible in a damages calculation in a wrongful death suit. View "Savage v. Co-Part of Connecticut, Inc." on Justia Law

The Supreme Court affirmed the decision of the court of appeals reversing the judgment of the trial court granting a directed verdict on a bad faith claim, holding that Wittmer v. Jones, 864 S.W.2d 885, 890 (Ky. 1993), established the applicable legal standard for both common law and statutory bad-faith claims.Cincinnati Insurance Company (CIC) brought a declaratory judgment action disputing coverage under a commercial general liability policy insuring K-2 Catering, LLC for claims Haley Belt made stemming from an accident that occurred during an event hosted by K-2's member-managers at their residence. Ultimately, judgment was entered declaring coverage under the policy. While the action was pending, Belt brought a separate action against K-2 and CIC, alleging bad faith and negligence in the settlement of her claims under K-2's policy. The negligence claims were settled and, after a jury trial, the jury returned a verdict against CIC. The court of appeals reversed, concluding that the trial court erred when it failed to grant CIC a directed verdict on the bad faith claims. The Supreme Court affirmed, holding that the trial court erred when it failed to apply the Wittmer standard and grant a directed verdict for CIC. View "Belt v. Cincinnati Insurance Co." on Justia Law

The Supreme Court reversed the opinion of the court of appeals determining that the prior notice of events exclusion (Exclusion 15) contained in the insurance policies applied to deny the coverage sought by King's Daughters Medical Center (KDMC) for claims made against it and that Insurers were entitled to recoupment of expenses, holding that the court of appeals erred as to both issues.Multiple medical malpractice claims were asserted against KDMC alleging unnecessary cardiac operations and lack of informed consent, among other allegations. Insurers subsequently filed a declaratory action in circuit court to determine their rights and coverage under the relevant policies. The circuit court granted summary judgment in favor of KDMC. The court of appeals reversed, ruling that Exclusion 15 applied to bar professional liability and excess coverage for the underlying litigation and that Insurers were entitled to recoupment of their expenses thus far in defending the litigation. The Supreme Court reversed, holding (1) Exclusion 15 did not bar coverage; and (2) the court of appeals lacked jurisdiction to rule on recoupment. View "Ashland Hospital Corp. v. Darwin Select Insurance Co." on Justia Law

The Supreme Court vacated the decision of the court of appeals affirming the summary judgment and fees ordered by the trial court in favor of Defendants' right to direct payment of basic reparation benefits within an element of loss under Kentucky's Motor Vehicle Reparations Act, holding that this Court lacked subject matter jurisdiction over this appeal.Defendants were involved in a collision while in a vehicle insured by Erie Insurance Exchange. Erie filed a declaratory judgment action to determine whether it was required to pay bills within an element of loss in an order directed by secured persons. Defendants filed a counterclaim seeking attorney's fees and excess interest for the unreasonable delay of the payment of their bills caused by Erie. The trial court granted Defendants' motion for an attorney's fee and denied Erie's second summary judgment motion, but did not indicate in its order that it granted Defendants' motion for summary judgment. The court of appeals affirmed. The Supreme Court vacated the order below, holding that no final and appealable orders were before the Court, and therefore, this Court lacked jurisdiction over the appeal. View "Erie Insurance Exchange v. Johnson" on Justia Law

The Supreme Court reversed the decision of the court of appeals affirming the judgment of the circuit court concluding that Zurich American Insurance company had a reasonable basis to deny James Nichols' claim for underinsured motorist benefits under a policy issued by Zurich to Nichols' employer, holding that the trial court erred.Zurich issued a commercial fleet policy to Nichols' employer providing underinsured motorist (UIM) coverage with $1,000,000 limits. Nichols was severely injured in an automobile collision and relied on various acknowledgments that the UIM coverage had $1,000,000 limits in settling with the tortfeasor. Zurich denied coverage, and Nichols filed this action to collect under the UIM provision. The trial court denied the motion. The Supreme Court remanded. On remand, Defendant amended his complaint to assert common law bad faith. Zurich settled Nichols' UIM claim for the police limits of $1,000,000, and the trial court granted Zurich's summary judgment motion for summary judgment on the bad faith claims. The Supreme Court reversed, holding that Nichols presented sufficient evidence to survive summary judgment on the bad faith claim. View "Nichols v. Zurich American Insurance Co." on Justia Law

The Supreme Court affirmed the decision of the court of appeals affirming the holding of the Workers' Compensation Board that the Administrative Law Judge properly found that Plaintiff's claim for workers' compensation benefits was barred by the applicable statute of limitations, holding that there was no error.Plaintiff received a workplace injury and filed a claim for benefits. Plaintiff never sought or received any temporary total disability benefits prior to the applicable statute of limitations expiring. The insurance adjuster for the employer's workers' compensation insurance carrier offered to settle Plaintiff's claim, but the parties never reached a settlement agreement. Plaintiff later filed an application for resolution of his claim, but the employer denied the claim on the grounds that it was time barred. The ALJ found that the claim was not timely under Ky. Rev. Stat. 342.185. The Board affirmed. The Supreme Court affirmed, holding that the ALJ properly determined that equitable principles did not warrant the tolling of the statute of limitations. View "Davis v. Blendex Co." on Justia Law

The Supreme Court affirmed the ruling of the court of appeals excluding from the definition of a "motor vehicle" or "trailer" a horse-drawn wagon for insurance coverage purposes, holding that the insurance policy was unambiguous and did not violate Plaintiff's reasonable expectations when she purchased her motorcycle coverage.While driving her motorcycle, Plaintiff encountered a horse-drawn buggy. The horse became spooked and jumped into oncoming traffic, gravely injuring Plaintiff when she collided with the horse. Plaintiff's motorcycle was insured by Progressive, and neither the driver of the buggy nor his father carried any form of insurance. Progressive denied Plaintiff's claim under the uninsured motorist provision of her motorcycle coverage on the grounds that a horse-drawn wagon was not covered under the policy. The circuit court granted Progressive's motion for summary judgment. The court of appeals affirmed, concluding that the horse-drawn wagon did not qualify as a "motor vehicle" or "trailer of any type" under the policy terms. The Supreme Court affirmed, holding that Plaintiff's assertions on appeal were unsupported. View "Davis v. Progressive Direct Insurance Co." on Justia Law

The Supreme Court reversed the opinion of the court of appeals reversing the decision of the circuit court granting summary judgment in favor of Defendant pursuant to Kentucky's Unfair Claims Settlement Practices Act (UCSPA) and dismissing Plaintiff's bad faith claim as barred by the statute of limitations, holding that the complaint was untimely.Plaintiff was injured in a motor vehicle accident and settled his dram shop liability claim against Pure Country, LLC, an establishment insured by United States Liability Insurance Company (USLI). Several years after settling, Plaintiff brought a bad faith claim against USLI under the UCSPA. The circuit court concluded that the action was untimely and granted summary judgment for Defendant. The court of appeals reversed. The Supreme Court reversed, holding (1) the trial court correctly determined that the bad faith claim against USLI was barred by the statute of limitations; and (2) the USCPA claim was not saved by relation back to an earlier filed or proposed pleading. View "United States Liability Insurance Co. v. Watson" on Justia Law

The Supreme Court affirmed the judgment of the court of appeals affirming the trial court's dismissal of this third-party bad-faith case against Arch Specialty Insurance Company and National Union Fire Insurance Company, holding that there was no error.At issue was whether the two insurance companies acted in bad faith while mediating negligence and wrongful death claims asserted by Plaintiff against the insureds of Arch and National Union after her husband died in a coal mining accident. The Supreme Court affirmed, holding that the trial court did not err in dismissing the third-party bad-faith claims and that there was no other error in the proceedings below. View "Mosley v. Arch Specialty Insurance Co." on Justia Law

In this insurance dispute, the Supreme Court affirmed the decision of the court of appeals reversing the trial court's grant of summary judgment in favor of the insureds (Insureds) but remanded the case to the trial court to allow Insureds an opportunity to litigate a lack of capacity defense, holding that the trial court's summary judgment against the insurer (Insurer) was erroneous.Insureds brought a declaratory judgment action to establish that Insurer owed payment under a homeowner's insurance policy for damage caused by a house fire. The house was damaged when Plaintiffs' son, Logan, attempted suicide. Insurer denied liability based on an "intentional loss" exclusion in the policy. The circuit court granted summary judgment for Insureds, declaring the exclusion inoperative. The court of appeals reversed. The Supreme Court affirmed, holding that, viewed objectively, undisputed evidence triggered the exclusion, and therefore, the summary judgment in favor of Insureds was erroneous. The Court then remanded the case to allow Insureds an opportunity to litigate a potential lack of capacity defense. View "Foreman v. Auto Club Property-Casualty Insurance Co." on Justia Law