Justia Insurance Law Opinion Summaries

In response to the COVID-19 pandemic, Kentucky temporarily (for about six weeks) barred healthcare corporations like Estes, which operates two dental clinics from providing nonemergency care. Estes lost substantial income as a result. Estes’ property insurance policy required Cincinnati Insurance to pay Estes for lost business income that results from a “direct” “physical loss” to its dental offices.The Sixth Circuit affirmed the dismissal of Estes’ suit against Cincinnati, noting that circuit courts have uniformly interpreted this “physical loss” language not to cover similar pandemic-related claims under the laws of many other states. The court concluded that Kentucky’s highest court would agree with those decisions. The phrase “physical loss” would convey to the “average person” that a property owner has been tangibly deprived of the property or that the property has been tangibly destroyed. COVID-19 and the government shutdown orders caused only intangible or economic harm. View "Estes v. Cincinnati Insurance Co." on Justia Law

Ikia Pope and Brandi Powell were in a motor vehicle collision. Pope left the scene of the collision. Powell alleged Pope drove a vehicle owned by third parties who gave permission for Pope to drive the vehicle. Progressive Direct Insurance Company insured the vehicle driven by Pope. Powell made bodily injury and property damage claims with Progressive Direct Insurance Company (insurer). Powell asserted she was entitled to treble property damages. Progressive sought a declaratory judgment for the purpose of adjudicating whether its insurance policy excluded treble damages pursuant to 47 O.S.2011, section 10-103. Progressive filed a motion for summary judgment, and the court concluded the treble damages provided by 47 O.S. 2011, section 10-103 were punitive in nature, and excluded by a clause excluding punitive damages. Powell appealed the subsequent consent judgment which was based, in part, upon the trial court's adjudication of the treble damages issue. The Oklahoma Supreme Court retained the appeal sua sponte, concurring with the district court that the statutory treble damages in 47 O.S.2011, section 10-103 were punitive in nature, and punitive damages were expressly excluded by the policy. View "Progressive Direct Ins. Co. v. Pope" on Justia Law

The Supreme Court affirmed in part and vacated in part the judgment of the intermediate court of appeals (ICA) in this dispute regarding payment of uninsured motorist (UM) and underinsured motorist (UIM) benefits to Plaintiff, holding that the circuit court properly excluded evidence related to an unleaded claim but erred in denying Plaintiff's motion to amend complaint solely on the basis of undue delay.Plaintiff, individually and as personal representative of the estate of her son, who died as a passenger in an automobile accident, brought this action seeking a declaratory judgment, arguing that Defendant improperly failed to recognize that UM and UIM coverages totaling $1.2 million were available to her. At issue before the Supreme Court was whether the circuit court erred in granting Defendant's motion to present evidence or in denying Plaintiff's motion to amend complaint. The ICA affirmed. The Supreme Court vacated in part, holding that the circuit court (1) did not abuse its discretion in granting Defendant's motion to preclude evidence; but (2) erred in concluding that Plaintiff could not amend her complaint due to undue delay. View "Carvalho v. AIG Hawaii Insurance Co." on Justia Law

In this case, the Supreme Court clarified the proper timing of Alvarado calculations, which determines the reimbursement due the insurer from a third-party settlement, and the reimbursement process for an insurer when the amount of workers' compensation (WC) benefits the insurer has already dispensed to the employee is less than the amount it owes the employee for its share of attorney's costs and fees for the third-party action.Petitioner received WC benefits from Respondent. Petitioner brought suit against the owner of the building in which she was injured and reached a settlement. Respondent then sought reimbursement of the WC benefits it had paid to Petitioner under Haw. Rev. Stat. 386-8 and Alvarado v. Kiewit Pacific Co., 993 P.2d 549 (Haw. 2000). At issue was whether certain WC benefits that Respondent owed Petitioner were properly classified as "paid compensation" and whether the process of Respondent's reimbursement of WC benefits exceeded the amount it had previously contributed to Petitioner as "paid compensation." The Supreme Court held (1) Alvarado calculations shall be performed based on the date on which the employee receives the third-party recovery; and (2) an insurer's "share" of the attorney's fees and costs the employee incurs while pursuing third-party recovery is based on the insurer's total WC liability. View "Moranz v. Harbor Mall, LLC" on Justia Law

In 2012, the Archdiocese purchased a roof membrane system from Siplast, for installation at a Bronx high school. Siplast guaranteed that the system would “remain in a watertight condition for a period of 20 years.” In 2016, school officials observed water damage in the ceiling tiles after a rainstorm and notified the installing contractor and Siplast. A designated Siplast contractor unsuccessfully attempted to repair the damage and prevent leaks. The Archdiocese ultimately obtained an estimate for remediation and replacement of approximately $5,000,000.The ensuing lawsuit alleged “Breach of the Guarantee” Siplast submitted a claim to its insurer, EMCC, asserting coverage under commercial general liability policies that covered “property damage” caused by an “occurrence,” defined as “an accident, including continuous or repeated exposure to substantially the same general harmful conditions.” The policies were subject to exclusions for “Your Product/Your Work” and “Contractual Liability.” The district court granted EMCC summary judgment, finding that while the complaint did allege property damage that was caused by an “occurrence,” the alleged damage fit within the Your Product/Your Work Exclusion. The Fifth Circuit reversed, finding that EMCC had a duty to defend. The underlying complaint contains allegations of damage to property other than Siplast’s roof membrane as part of the claim against Siplast; the exclusion does not apply. View "Siplast, Inc. v. Employers Mutual Casualty Insurance Co." on Justia Law

The Supreme Judicial Court affirmed the judgment of the superior court entering summary judgment in favor of Joann Parker and dismissing this interpleader action, holding that summary judgment was properly allowed.When Sean Parker purchased a life insurance policy he named his then-wife, Dawn Diana-Parker, as the primary beneficiary and Joann, his mother, as alternative beneficiary. After Sean and Dawn divorced Sean did not amend his beneficiary designation. Following Sean's death, American Family Life Assurance Company of Columbus, Sean's insurer, brought this interpleader action to determine whether Mass. Gen. Laws ch. 190B, 2-804, the Massachusetts Uniform Probate Code's revocation of probate and nonprobate transfers by divorce provision, terminated Dawn's beneficiary status by operation of law. The judge held that section 2-804 applied to Sean's policy and granted summary judgment for Joann. The Supreme Judicial Court affirmed, holding that Dawn's arguments on appeal were unavailing. View "American Family Life Assurance Co. of Columbus v. Parker" on Justia Law

The Supreme Judicial Court affirmed the superior court's judge's denial of Plaintiff's motion for a preliminary injunction, holding that the judge did not commit an abuse of discretion in denying Plaintiff's motion.Plaintiff, a professor at Harvard University, was indicted on two counts of making false statements to a government agency. Plaintiff made. Written request for indemnification and advance payment of his legal fees and expenses pursuant to Harvard's indemnification policy, which provides for the indemnification of qualified persons against liabilities and expenses incurred in connection with, inter alia, the defense of criminal proceedings the person may be threatened with by reason of serving in a "covered role." Harvard denied indemnification. Thereafter, Plaintiff brought this action asserting several claims with respect to the failure to provide indemnification. Plaintiff also filed a motion seeking a preliminary injunction requiring Harvard to provide advancement of his legal fees and expenses. A superior court judge denied the motion. The Supreme Judicial Court affirmed, holding that the motion judge did not abuse her discretion in concluding that Plaintiff did not establish a likelihood of success on the merits of his claims seeking advancement of fees and expenses. View "Lieber v. President & Fellows of Harvard College" on Justia Law

Appellees, Rite Aid Corporation, Rite Aid Hdqtrs. Corp., and Rite Aid of Maryland, Inc. (collectively, “Rite Aid”), held a general liability insurance policy underwritten by defendany Chubb, Limited ("Chubb"). Rite Aid and others were defendants in multi-district litigation before the United States District Court for the Northern District of Ohio (the “MDL Opioid Lawsuits”). Plaintiffs in that suit filed over a thousand suits in the MDL Opioid Lawsuits against companies in the pharmaceutical supply chain for their roles in the national opioid crisis. Certain suits were bellwether suits - including the complaints of Summit and Cuyahoga Counties in Ohio (“the Counties”) which were at issue here. The question this case presented for the Delaware Supreme Court was whether insurance policies covering lawsuits “for” or “because of” personal injury required insurers to defend their insureds when the plaintiffs in the underlying suits expressly disavowed claims for personal injury and sought only their own economic damages. The Superior Court decided that Rite Aid’s insurance carriers were required to defend it against lawsuits filed by two Ohio counties to recover opioid-epidemic-related economic damages. As the court held, the lawsuits sought damages “for” or “because of” personal injury because there was arguably a causal connection between the counties’ economic damages and the injuries to their citizens from the opioid epidemic. The Supreme Court reversed, finding the plaintiffs, governmental entities, sought to recover only their own economic damages, specifically disclaiming recovery for personal injury or any specific treatment damages. Thus, the carriers did not have a duty to defend Rite Aid under the governing insurance policy. View "ACE American Insurance Company v. Rite Aid Corporation" on Justia Law

Ingham, Jackson, and Calhoun County, Michigan (collectively, the Counties) filed an action alleging that they had a right to receive a decade’s worth of surplus contributions (surplus equity) made to the Michigan County Road Commission Self-Insurance Pool (the Pool). The Counties believed they were the successors in interest to their dissolved road commissions and, as such, were entitled to the surplus equity that the commissions might have received had they not been dissolved and withdrawn from the Pool. Jackson County made one other argument: because its road commission never formally withdrew from the Pool, the county said it had a right to receive surplus equity on the same terms as any current member. The Pool disagreed, contending the Counties had no right to surplus equity because the documents governing the Pool’s operations and its contracts with its various members provided the Pool with discretion in distributing surplus equity. This included, the Pool contended, the power to exclude former members should a distribution be made. The Court of Appeals sided with the Counties, holding that the Counties were the successors in interest to their dissolved road commissions and, as a matter of public policy, the Counties had a right to receive surplus equity for fiscal years in which their road commissions were members of the Pool. The Court of Appeals also determined that the dissolution of the Jackson County Road Commission did not disqualify Jackson County from membership in the Pool, and therefore, the county could receive surplus equity regardless of any public-policy considerations. The Michigan Supreme Court reversed. The Court agreed with the Pool that the Counties did not have a contractual right to receive surplus equity and that such an arrangement was not contrary to public policy. For Jackson County, the Court held that the dissolution of its county road commission did not transfer membership in the Pool from the road commission to the county itself, so the Pool could exclude Jackson County from post-dissolution distributions. View "County Of Ingham v. Michigan County Road Commission Self-Insurance Pool" on Justia Law

TBB filed suit seeking to recoup losses stemming from the limitations on the operations of nonessential businesses during the COVID-19 pandemic through its commercial property insurance policy which covers business interruption losses caused by "direct physical loss of or damage to property."The Fifth Circuit concluded that the suspension of dine-in services during the COVID-19 pandemic is not a direct physical loss of or damage to property. Applying Texas law, the court concluded that the district court correctly determined that TBB's losses are not covered by either the business income and extra expense coverage (BI/EE) or the restaurant extension endorsement (REE) provision. Without coverage, the court need not address whether any policy exclusions also apply. In regard to TBB's extra-contractual claims, the court concluded that they were properly dismissed as abandoned. Finally, the court found no err in the district court's decision to deny TBB leave to amend. Accordingly, the court affirmed the district court's grant of judgment on the pleadings in favor of the insurer. View "Terry Black's Barbecue, LLC v. State Automobile Mutual Insurance Co." on Justia Law