Justia Insurance Law Opinion Summaries

Winter wheat farmers could purchase insurance to protect against below-average harvests. The policies at issue here offered yield protection. On July 1, 2014, the Federal Crop Insurance Corporation (“FCIC”) published an interim rule to implement the 2014 Farm Bill. In that interim rule, the FCIC warned that the APH yield exclusion “may not be implemented upon publication” because “[p]roduction data availability and intensive data analysis may limit FCIC’s ability to authorize exclusions of yields for all APH crops in all counties.” Therefore, the FCIC amended the Common Crop Insurance Policy (CCIP) Basic Provisions (the actual terms of the insurance policy offered for sale) “to allow the actuarial documents to specify when insureds may elect to exclude any recorded or appraised yield.” The revised CCIP Basic Provisions stated that farmers “may elect” the APH yield exclusion “[i]f provided in the actuarial documents.” The deadline for winter wheat farmers to purchase insurance for the 2015 crop year was September 30, 2014. When Plaintiffs purchased insurance, they elected to use the APH yield exclusion. But in a letter dated October 31, 2014, the USDA notified insurance providers that the APH Yield Exclusion would not be available for winter wheat for the 2015 crop year. The letter stated that insurance providers could respond to farmers’ elections by pointing them to the USDA’s “actuarial documents,” which did not yet “reflect that such an election is available.” Plaintiffs sought review of this denial through the USDA’s administrative appeals process. An administrative judge determined that she lacked jurisdiction over Plaintiffs’ challenge because the October 2014 letter to insurance providers was not an adverse agency decision. Plaintiffs then appealed to the Director of the National Appeals Division. The Director found that the October 2014 letter was an adverse agency decision, but affirmed the FCIC’s decision not to make the APH yield exclusion available to winter wheat farmers for the 2015 crop year. Plaintiffs appealed the Director’s decision to the United States District Court for the District of Colorado. The district court reversed the Director’s decision and remanded the case to the FCIC with instructions to retroactively apply the APH yield exclusion to Plaintiffs’ 2015 crop year insurance policies, reasoning the applicable statute unambiguously made the APH yield exclusion available to all farmers on the day the 2014 Farm Bill was enacted. Finding no reversible error in the district court’s judgment, the Tenth Circuit affirmed. View "Ausmus v. Perdue" on Justia Law

Plaintiff-Appellant Jeffrey Allen was injured in a car accident in May 2013. His automobile insurance policy included coverage for medical expenses arising from car accidents, but this coverage contained a one-year limitation period such that he could not obtain reimbursement for medical expenses that accrued a year or more after an accident. Allen sought reimbursement for medical expenses accruing more than a year after his accident, arguing this limitation period was invalid on two grounds: (1) a 2012 disclosure form that his insurer sent him stated that his policy covers reasonable medical expenses arising from a car accident, Colorado’s reasonable-expectations doctrine rendered the one-year limitations period unenforceable; and (2) Colorado’s MedPay statute, which required car insurance companies to offer at least $5,000 of coverage for medical expenses, prohibited placing a one-year time limit on this coverage. The district court granted summary judgment in favor of the insurer. After review, the Tenth Circuit rejected both of Allen’s arguments and affirmed the district court order. View "Allen v. USAA" on Justia Law

In 2013, while the disputed insurance policy was in effect, several guests at the Siloam Springs Hotel allegedly sustained injuries due to carbon monoxide poisoning stemming from an indoor-swimming-pool heater that had recently been serviced. The hotel sought coverage under the policy, and the insurer denied coverage based on the exclusion for “qualities or characteristics of indoor air.” This case made it back to the Tenth Circuit following a remand in which the district court was directed to determine whether there was complete diversity of citizenship between the parties, which was an essential jurisdictional issue that needed to be decided before it could properly address the merits of this case. On remand, the district court received evidence on this question and determined that diversity jurisdiction was indeed proper. The district court also certified a policy question to the Oklahoma Supreme Court, which held that the exclusion at issue in this case - however interpreted -should not be voided based on public policy concerns. Following the Oklahoma Supreme Court’s resolution of the certified question, the insurer asked the district court to administratively close the case, arguing that “no further activity in this case . . . remains necessary to render the [district c]ourt’s adjudication of the coverage issue which the case concerns a final judgment.” The hotel asked the court to reopen the case to either reconsider its previous order or to enter a final, appealable judgment against the hotel. The district court held that the case had already been administratively closed and it had no need to reopen the case, since “both its finding of diversity jurisdiction and the Oklahoma Supreme Court’s answer to the certified question did not alter in any way” the court’s summary judgment decision on the merits of the coverage dispute. The hotel appealed. The Tenth Circuit determined the hotel was entitled to coverage under the policy at issue, and reversed the district court's denial. The case was remanded for further proceedings on the question of damages. View "Siloam Springs Hotel v. Century Surety Company" on Justia Law

Belsen Getty, LLC, a registered investment adviser owned by Terry Deru, obtained a claims-made financial-services-liability policy (the Policy) from XL Specialty Insurance Company covering Belsen Getty and its advisers for the period for one year. Under the policy, XL had no duty to defend. During the policy period James, Jenalyn, and Wade Morden brought claims against Belsen Getty and Deru alleging improper and misleading investment advice. XL denied coverage, asserting the Mordens’ claims and claims brought by the Securities and Exchange Commission (SEC) before the policy period concerned “Interrelated Wrongful Acts,” as defined by the Policy, and that the Policy therefore required treating the two claims as one claim made before the policy period. Belsen Getty and Deru then settled with the Mordens, assigning their rights against XL; and the Mordens sued XL in federal district court, raising the assigned claims that XL breached its covenant of good faith and fair dealing and its fiduciary duties to Belsen Getty and Deru in denying coverage under the Policy. XL counterclaimed that the Policy’s Interrelated Wrongful Acts provision precluded coverage. The Mordens moved for partial summary judgment on the counterclaim and on several of XL's affirmative defenses. XL moved for summary judgment based on the policy and for failure to prove bad faith or breach of fiduciary duty. The district court denied XL's counterclaim, but granted summary judgment on the bad-faith and fiduciary-duty claims. The Mordens appealed summary judgment against them on their bad-faith and fiduciary-duty claims and on the denial of their motion to amend their complaint to add a breach-of-contract claim. XL cross-appealed the summary judgment against it on its counterclaim that the Policy’s Interrelated Wrongful Acts provision barred all the Mordens’ claims. The Tenth Circuit reversed the denial of XL’s motion for summary judgment on its counterclaim: this reversal undermined the Mordens’ challenges to the summary judgment against them and the denial of their motion to amend. The Court therefore affirmed summary judgment against the Mordens on their claims and the denial of their motion to amend. View "Morden v. XL Specialty Insurance" on Justia Law

The plaintiffs in consolidated appeals each settled a claim under their automobile-insurance policies with the defendants. But plaintiffs maintained the defendants illegally reduced their settlement offers by taking into account certain benefits they had previously paid plaintiffs. The district courts dismissed the plaintiffs’ putative class-action lawsuits after concluding the plaintiffs each waived their rights to collect further damages from the defendants on their settled claims. The Tenth Circuit reversed in part and remanded to the district court with instructions to vacate its judgment in favor of USAA Casualty Insurance Company because it lacked jurisdiction to hear the claims against that defendant. Otherwise, the Court affirmed. View "McCracken v. Progressive Direct Ins. Co." on Justia Law

Auto-Owners Insurance Company provided automobile insurance to Frank and Nancy Csaszar and their daughter, Jennifer. But when that policy’s term came to a close, Auto-Owners informed Mr. and Mrs. Csaszar that, because of their daughter’s driving record, it would only renew their policy if it excluded her from coverage. The Csaszars agreed. The policy accordingly included an “excluded-driver” provision that stated the policy “shall provide no coverages” for “claims arising out of [Jennifer Csaszar’s] operation or use of any automobile. While this new policy was operative, an uninsured motorist rear-ended Jennifer while she was driving a vehicle not scheduled under her parents’ Auto-Owners policy. Jennifer filed a claim with Auto-Owners, requesting it pay her $500,000 in uninsured and underinsured motorist (UM/UIM) coverage. Auto-Owners denied the claim because it believed the excluded-driver provision barred Jennifer from such coverage. It then sought a declaratory judgment that Jennifer was not entitled to any coverage, including UM/UIM coverage, under her parents’ policy. In response, Jennifer filed a counterclaim seeking a declaration she was, in fact, entitled to this coverage. The district court granted Auto-Owners’ motion for summary judgment. Finding no reversible error in that judgment, the Tenth Circuit affirmed the district court. View "Auto-Owners Insurance Company v. Csaszar" on Justia Law

This appeal involved the extent of a duty to defend under a “professional services” policy of liability insurance issued to a law firm. The issue arose when the law firm was confronted with allegations of overbilling. The insurer, Evanston Insurance Company, defended the law firm, The Law Office of Michael P. Medved, P.C., under a reservation of rights but ultimately concluded that the allegations of overbilling fell outside the law firm’s coverage for professional services. The law firm disagreed with this conclusion; the district court agreed with the insurer. The Tenth Circuit concurred with the district court and affirmed summary justment in favor of Evanston on all claims and counterclaims. View "Evanston Insurance v. Law Office Michael P. Medved" on Justia Law

This appeal stemmed from a dispute between Summit Park Townhome Association and its insurer, Auto-Owners Insurance Company, over the value of property damaged in a hail storm. To determine the value, the district court ordered an appraisal and established procedural requirements governing the selection of impartial appraisers. After the appraisal was completed, Auto-Owners paid the appraised amount to Summit Park. But the court found that Summit Park had failed to make required disclosures and had selected a biased appraiser. In light of this finding, the court vacated the appraisal award, dismissed Summit Park’s counterclaims with prejudice, and awarded interest to Auto-Owners on the amount earlier paid to Summit Park. Summit Park appealed, raising six issues of alleged error with the proceedings. The Tenth Circuit affirmed, however, finding that in the absence of a successful appellate challenge to the disclosure order, Summit Park was obligated to comply and did not. The court was thus justified in dismissing Summit Park’s counterclaims. In addition, Summit Park’s failure to select an impartial appraiser compelled vacatur of the appraisal award under the insurance policy. View "Auto-Owners v. Summit Park" on Justia Law

This appeal stemmed from a dispute between Summit Park Townhome Association and its insurer, Auto-Owners Insurance Company, over the value of property damaged in a hail storm. To determine the value, the district court ordered an appraisal and established procedural requirements governing the selection of impartial appraisers. After the appraisal was completed, Auto-Owners paid the appraised amount to Summit Park. But the court found that Summit Park had failed to make required disclosures and had selected a biased appraiser. In light of this finding, the court vacated the appraisal award, dismissed Summit Park’s counterclaims with prejudice, and awarded interest to Auto-Owners on the amount earlier paid to Summit Park. Summit Park appealed, raising six issues of alleged error with the proceedings. The Tenth Circuit affirmed, however, finding that in the absence of a successful appellate challenge to the disclosure order, Summit Park was obligated to comply and did not. The court was thus justified in dismissing Summit Park’s counterclaims. In addition, Summit Park’s failure to select an impartial appraiser compelled vacatur of the appraisal award under the insurance policy. View "Auto-Owners v. Summit Park" on Justia Law

This appeal grew out of a dispute between an insured (Summit Park Townhome Association) and its insurer (Auto-Owners Insurance Company) over the value of property damaged in a hail storm. To determine the value, the district court ordered an appraisal and established procedural requirements governing the selection of impartial appraisers. After the appraisal was completed, Auto-Owners paid the appraised amount to Summit Park. But the court found that Summit Park had failed to make required disclosures and had selected a biased appraiser. In light of this finding, the court vacated the appraisal award, dismissed Summit Park’s counterclaims with prejudice, and awarded interest to Auto-Owners on the amount earlier paid to Summit Park. Summit Park appealed, but the Tenth Circuit affirmed. “In the absence of a successful appellate challenge to the disclosure order, Summit Park was obligated to comply and did not. The court was thus justified in dismissing Summit Park’s counterclaims. In addition, Summit Park’s failure to select an impartial appraiser compelled vacatur of the appraisal award under the insurance policy. Finally, Summit Park obtained due process through the opportunity to object to the award of interest.” View "Auto-Owners v. Summit Park" on Justia Law