Justia Insurance Law Opinion Summaries

The Supreme Court held that a commercial property insurance policy did not provide coverage for the economic losses JGB Vegas Retail Lessee, LLC suffered when COVID-19 forced JGB to shut down abruptly.JGB was insured under a policy with Starr Surplus Lines Insurance Co. amidst the closures and accompanying financial troubles of the COVID-19 pandemic, JGB filed a claim with Starr seeking coverage for lost business income, extra expenses, and other applicable coverage. When Starr did not respond JGB brought suit, claiming that the presence of COVID-19 on the property created the requisite "direct physical loss or damage" covered under the policy. Starr moved for summary judgment, which the district court granted in part. Thereafter, Starr filed the instant petition seeking a writ of mandamus challenging the denial of summary judgment on the remaining claims. The Supreme Court affirmed, holding that the district court erred in denying summary judgment because JGB's claims for losses resulting from COVID-19 were excluded from coverage. View "Starr Surplus Lines Insurance Co. v. District Court" on Justia Law

The Supreme Court reversed the judgment of the appeals officer denying Claimant's request to reopen his industrial claim, holding that the appeals officer misapplied Nev. Rev. Stat. 616C.065(7) and failed to properly consider whether Claimant satisfied the requirements of Nev. Rev. Stat. 616C.390.Claimant, a high school teacher, was injured while diverting a student altercation and requested workers' compensation from the school district's industrial insurer (Insurer). Insurer's acceptance of coverage was restricted to Claimant's cervical strain and thoracic sprain. Insurer, however, did not expressly deny coverage for treatment to Claimant's lumber spine. Claimant later sought the reopening of his industrial claim under Nev. Rev. Stat. 616C.390 for treatment to his lumbar spine. Insurer denied the request, and a hearing officer affirmed. The appeals officer also affirmed. The Supreme Court reversed, holding (1) the appeals officer misapplied section 616C.065(7) to find that the lumbar spine was not within the scope of Claimant's accepted industrial claim; and (2) Claimant's failure to appeal after receiving Insurer's determination of claim acceptance or closure did not preclude him from subsequently seeking to reopen his claim under section 616.390. View "Gilman v. Clark County School District" on Justia Law

The Supreme Court affirmed the judgment of the district court enjoining a regulation to the extent it required insurers to give retroactive premium refunds but otherwise rejecting the lawsuit brought by National Association of Mutual Insurance Companies (NAMIC), holding that the Nevada Division of Insurance (Division) had the statutory and constitutional authority to promulgate R087-20.While the Nevada Insurance Code permits insurers to use customer credit information when underwriting and rating personal property and casualty insurance, the Division promulgated a regulation, R087-20, after the governor's COVID-19 declaration of emergency led to mass unemployment across the state. R087-20 prohibited insurers from adversely using consumer credit information changes that occurred during the emergency declaration, plus two years. On behalf of itself and its members, NAMIC sued to invalidate the regulation. The district court largely rejected NAMIC's claims. The Supreme Court affirmed, holding that the Division did not exceed its authority in promulgating R087-20. View "Nat'l Ass'n of Mutual Insurance Cos." on Justia Law

The Supreme Court answered certified questions brought to it by the Ninth Circuit Court of Appeals as to whether, in Nevada, the insured or the insurer has the burden of proving that an exception to an exclusion of coverage provision applies.The Ninth Circuit asked whether, under Nevada law, the burden of proving the applicability of an exception to an exclusion of coverage in an insurance policy falls on the insurer or the insured and whether the party that bears that burden may rely on extrinsic evidence to carry its burden. The Supreme Court answered (1) the burden of proving the applicability of an exception to an exclusion for coverage in an insurance policy falls on the insured; and (2) the insured may rely on any extrinsic evidence that was available to the insurer at the time the insured tendered the defense to the insurer. View "Zurich American Insurance Co. v. Ironshore Specialty Insurance Co." on Justia Law

The Supreme Court affirmed the order of the district court finding that an exclusion in a personal umbrella liability insurance policy expressly excluding coverage for damages that are "payable to any insured" was valid and precluded coverage, holding that the district court did not err.Plaintiff sought coverage for injuries he incurred as the passenger on a motorcycle that crashed. At the time of the crash, Plaintiff's wife was the named insured on a personal umbrella policy directly underwritten by Farmers Insurance Exchange. Farmers denied coverage under the umbrella policy under the exclusion at issue. Because Plaintiff was an insured under the umbrella policy, argued Farmers, he was not entitled to payment under the policy. The district court granted summary judgment for Farmers. The Supreme Court affirmed, holding (1) Nev. Rev. Stat. 687B.147 does not apply to umbrella policies; (2) an insured who alleges that an exclusion was not disclosed must make that allegation in an affidavit rather than rely solely on the arguments of counsel; and (3) there was no other error on the part of the district court. View "Sciarratta v. Foremost Insurance Co. Grand Rapids Michigan" on Justia Law

The Supreme Court answered a certified question under Nev. R. App. P. 5 concerning an insurer's right to reimbursement, holding that when a party to a contract performs a challenged obligation under protest and a court subsequently determines that the contract did not require performance, the party may generally recover in restitution, thus giving effect to the terms of the parties' bargain.Insurer filed this declaratory judgment action seeking reimbursement of expenses it had occurred in defending Insured against a suit by a third party. The district court concluded that Insurer was not entitled to reimbursement. The Ninth Circuit Court of Appeals affirmed, concluding that the suit did not trigger a duty to defend. The Supreme Court accepted a certified question from the Ninth Circuit regarding the issue. The Supreme Court then held (1) no contract governed the right to reimbursement in this case; and (2) under the principle of unjust enrichment, a party that performs a disputed obligation under protest and does not in fact have a duty to perform is entitled to reimbursement. View "Nautilus Insurance Co. v. Access Medical, LLC" on Justia Law

The Supreme Court reversed in part the order of the district court denying Petitioner's petition for judicial review of an order of the Nevada Division of Insurance, holding that remand was required with the instruction that the district court grant judicial review in part.Choice Home Warranty (CHW) marketed and sold Home Warranty Administrator of Nevada, Inc. (HWAN)'s home warranty service contracts, in which HWAN was the obligor. The Department of Business and Industry, Division of Insurance filed a complaint alleging that HWAN, dba CHW, made false entries by answering no to a question in certificate-of-registration renewal applications, conducted business in an unsuitable manner, and failed to make records available to the Division. A hearing officer found that HWAN committed all of the alleged violations. The district court denied HWAN's petition for judicial review. The Supreme Court reversed in part, holding (1) under Nev. Rev. Stat. 690C.150, a provider of home warranty services is not simply an entity that issues, sells, or offers for sale service contracts but the obligor in those contracts; (2) CHW was not an obligor so it was not a provider and need not have held a certificate of registration; and (3) HWAN did not act improperly by selling its contracts through an unregistered entity. View "Home Warranty Administrator of Nevada, Inc. v. State, Department of Business & Industry" on Justia Law

The Supreme Court reaffirmed in this case that undocumented aliens who are injured while working for a Nevada employer may be eligible for monetary disability benefits, holding that these monetary benefits, paid by the insurer, do not conflict with federal law or undermine the Legislature's intent.Respondent, an undocumented Nevadan, was severely injured while working for High Point Construction and applied for permanent total disability (PTD) status. Associated Risk Management (ARM), High Point's insurance administrator, denied the request. An appeals officer reversed and granted Respondent PTD status pursuant to the "odd-lot doctrine." ARM petitioned for judicial review, arguing that the appeals officer committed legal error by granting PTD to an undocumented alien. The Supreme Court affirmed, holding (1) undocumented aliens are not precluded from receiving disability benefits under Nevada's workers' compensation laws; (2) although federal law prohibits employers from knowingly employing an undocumented alien, it does not prohibit insurers from compensating undocumented aliens for injuries they sustain while working; and (3) the appeals officer's decision was based on substantial evidence. View "Associated Risk Management, Inc. v. Ibanez" on Justia Law

The Supreme Court granted Petitioners' petitions for extraordinary relief in part and denied the petitions in part, holding that intervention after final judgment is impermissible under Nev. Rev. Stat. 12.130 and that an action that reached final judgment has no pending issues and, therefore, consolidation is improper.In 2007, Gary Lewis struck Cheyenne Nadler in an automobile accident. When Lewis and his insurer, United Automobile Insurance Company (UAIC), failed to defend Nalder's tort action, a default judgment was entered. In 2018, Nadler attempted to collect on the judgment through a new action. UAIC moved to intervene in and consolidate the 2007 case and the 2018 action. The district court granted the motions. The Supreme Court held (1) the district court erred in granting intervention in the 2007 action because a default judgment had been entered, but the court properly granted intervention in the 2018 action because a final judgment had not yet been entered; (2) the district court improperly consolidated the two cases; and (3) the district court properly vacated a judgment erroneously entered by the district court clerk when a stay was in effect. View "Nalder v. Eighth Judicial District Court" on Justia Law

The Supreme Court answered a certified question submitted by the United States District Court for the District of Nevada by holding that, under Nevada law, an insurer’s liability where it breaches its contractual duty to defend is not capped at the policy limits plus any costs incurred by the insured in mounting a defense. Instead, an insurer may be liable for any consequential damages caused by its breach. Further, good faith determinations are irrelevant for determining damages upon a breach of the duty to defend.Respondents filed suit against Appellant-insurer for breach of contract and other causes of action. The federal court concluded that Appellant did not act in bad faith but did breach its duty to defend. The federal court subsequently entered an order staying the proceedings until resolution of the certified question by the Supreme Court. The Supreme Court answered as set forth above, holding that an insured may recover any damages consequential to the insurer’s breach of its duty to defend, and therefore, an insurer’s liability for breach of that duty is not capped at the policy limits, even if the insurer did not act in bad faith. View "Century Surety Co. v. Andrew" on Justia Law