Justia Insurance Law Opinion Summaries

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Prairie sued Coyle in Illinois state court concerning the replacement of valves purchased by Prairie. Coyle's insurer, Federated, sought a declaration that it had no duty to defend or indemnify Coyle in that suit. After Coyle answered Federated’s complaint, Federated moved for judgment on the pleadings. Coyle opposed the motion and later moved for leave to file supplemental briefs to show that the state-court action potentially fell within Federated’s coverage obligations. The district court denied Coyle’s motions to file supplemental briefs and granted Federated judgment on the pleadings. The court ruled that Prairie’s complaint did not allege “property damage” or an “occurrence” because Prairie only sought damages for the repair and replacement of defective products—purely economic losses. Prairie’s counsel had clarified at a discovery hearing that “Prairie was not making a claim for loss of use but rather for the costs of replacing the allegedly defective valves and the associate piping” and the defectiveness of the valves was foreseeable.The Seventh Circuit reversed. In granting Federated’s motion, the court relied on some of the new facts that Coyle had unsuccessfully moved to introduce through supplemental briefs while ignoring other facts. The court’s handling of the case ran afoul of local rules and the Federal Rules of Civil Procedure and deprived Coyle of its right to present material factual evidence bearing on the central issue in the case. View "Federated Mutual Insurance Co. v. Coyle Mechanical Supply Inc." on Justia Law

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After plaintiff's boat was stolen, Geico denied coverage based on plaintiff's misrepresentation that he was in possession of the boat. On appeal, plaintiff argued that the district court erred in applying the doctrine of uberrimae fidei.The Eleventh Circuit affirmed the district court's grant of summary judgment for Geico and denial of plaintiff's motion for partial summary judgment. The court held that plaintiff's misrepresentation voided his policy ab initio. Based on the record, the court concluded that plaintiff's initial policy, by its terms, expired on May 5, 2018, because he did not pay the required premium for the new policy period. Therefore, plaintiff's boat was uninsured between May 5, 2018, and when he first called Geico on May 25, 2018. Although plaintiff is correct that the doctrine of uberrimae fidei applies only when an insurer issues a policy, not when a policy is already in full force, his policy was not in full force on May 25th because it had expired. The court also concluded that plaintiff's statements were material to Geico's issuance of coverage on May 25, even if by renewal and backdating. Therefore, the district court properly applied the doctrine of uberrimae fidei and correctly held that plaintiff's renewal policy was void ab initio. View "Quintero v. Geico Marine Insurance Co." on Justia Law

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The underlying controversy entailed will-, estate-, and insurance-contest litigation commenced in 2008 by Appellee Jeffrey Stover in his capacity as the attorney for Appellant, David Clark, who was the testator’s brother. In 2010, Appellee Stover also lodged a second complaint on behalf of Monica Clark, the testator’s mother, now deceased. After the claims in both actions failed, Appellant and Mrs. Clark filed this legal malpractice action in 2015, advancing claims of professional negligence and breach of contract against Appellee Stover and his law firm. Upon Appellees’ motion, the common pleas court awarded summary judgment in their favor, finding, as relevant here, that Appellant and Mrs. Clark were aware of the alleged negligence and the asserted breach more than four years before they lodged the malpractice action. Since the applicable statutes of limitations provided for commencement of a negligence action within two years after accrual, and a contractual action within four years after breach, the county court found the claims to be untimely. The Superior Court affirmed on the "occurrence rule." The Pennsylvania Supreme Court granted discretionary review to address the "continuous representation rule," under which the applicable statutes of limitations would not run until the date on which Appellees' representation was terminated. Appellant maintains that this rule should be adopted in Pennsylvania to permit statutes of limitations for causes of action sounding in legal malpractice to be “tolled until the attorney’s ongoing representation is complete.” While the Supreme Court recognized "there are mixed policy considerations involved, as relating to statutes of limitations relegated to the legislative province, we conclude that the appropriate balance should be determined by the General Assembly." The Superior Court judgment was affirmed. View "Clark (Est of M. Clark) v. Stover, et al" on Justia Law

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In a matter of first impression, the Pennsylvania Supreme Court granted review in this case to consider whether Section 310.74(a) of the Insurance Department Act of 1921 prohibited a licensed insurance producer from charging fees in addition to commissions in non-commercial, i.e. personal, insurance transactions. During its investigation, the Department discovered that, between March 2011 and October 2015, appellants charged a non-refundable $60- $70 fee to customers seeking to purchase personal insurance products. These fees were collected from the customers before appellants prepared the insurance policy applications. One consumer complaint indicated appellants kept an “un- refundable broker application fee” when the consumer declined to buy a policy. The Department’s investigation also revealed appellants paid a “one-time” $50 referral fee to car dealership sales personnel when they referred their customers in need of insurance. The Department concluded appellants’ fee practices included improper fees charged to consumers “for the completion of an application for a contract of insurance” and prohibited referral payments to the car dealerships. The Supreme Court held lower tribunals did not err when they determined Section 310.74(a) of the Act did not authorize appellants to charge the $60-$70 non-refundable fee to their customers seeking to purchase personal motor vehicle insurance. The Commonwealth Court’s decision upholding the Commissioner’s Adjudication and Order was affirmed. View "Woodford v. PA Insurance Dept." on Justia Law

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After Mark Braswell died when his road bike collided with a stopped truck, his survivors filed suit against the truck's owner, the Brickman Group. Brickman was primarily insured by ACE and secondarily insured by AGLIC. ACE rejected plaintiffs' three settlement offers before and during trial. The jury ultimately awarded plaintiffs nearly $28 million, plaintiffs and Brickman settled for nearly $10 million, and AGLIC paid nearly $8 million of the amount. AGLIC then filed suit against ACE, arguing that because ACE violated its Stowers duty to accept one of the three settlement offers for the primary policy limits, ACE had to cover AGLIC's settlement contribution. The district court agreed.The Fifth Circuit affirmed the district court's judgment and held that ACE's Stowers duty was triggered by plaintiffs' third offer, and that ACE violated this duty. In this case, the offer generated a Stowers duty because it "proposed to release the insured fully" and it was not conditional. Furthermore, the evidence was sufficient to support that ACE violated its Stowers duty by failing to reevaluate the settlement value of the case and accept plaintiffs' reasonable offer. View "American Guarantee & Liability Insurance Co. v. ACE American Insurance Co." on Justia Law

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The Supreme held that the trial court did not err in determining that Defendants were not afforded underinsured motorist and medical payments coverage under an insurance policy issued by Plaintiff, an insurance company, to a family member.Defendants argued that they were entitled to medical payments and underinsured motorist coverage under Plaintiff's policy because they were "residents" of the insured's "household." Plaintiff disputed coverage and filed a declaratory judgment action in superior court, arguing that Defendants were not residents of the insured's household at the time of the accident. The trial court entered summary judgment for Plaintiff, concluding as a matter of law that Defendants were not entitled to coverage under the policy. The court of appeals affirmed. The Supreme Court affirmed, holding that the court of appeals did not err in determining that Defendants are not entitled to coverage under the policy and that the trial court appropriately awarded summary judgment in favor of Plaintiff. View "N.C. Farm Bureau Mutual Insurance Co., Inc. v. Martin" on Justia Law

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Plaintiff filed suit against Safeco after the insurance company denied her underinsured motorist insurance (UIM) coverage. The district court granted summary judgment to Safeco.The Eighth Circuit affirmed, holding that this case does not involve a set-off within a policy but stacking of separate policies; the anti-stacking provision in the policy unambiguously limits the total of plaintiff's UIM coverage to the highest applicable limit; and Safeco's coverage is not illusory. Therefore, Safeco's anti-stacking provision does not preclude Safeco's excess coverage from ever applying—it simply prevents plaintiff from stacking coverage from different policies when she has already received the highest applicable limit of UIM coverage. View "Johnson v. Safeco Insurance Company of Illinois" on Justia Law

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The First Circuit reversed the order of the district court granting summary judgment in favor of General Star Indemnity Company, the excess insurer of Performance Trans., Inc. and Utica Mutual Insurance Company (collectively PTI) in this Massachusetts breach of contract and unfair and deceptive insurance practices action under Mass. Gen. Laws ch. 93A, 11, holding that the district court erred in finding the relevant excess policy provisions unambiguously excluded coverage.In 2019, a PTI tanker-truck spilled approximately 4,300 gallons of gasoline, diesel fuel, and dyed diesel fuel onto the roadway and into a nearby reservoir. After cleanup costs exceeded PTI's primary insurance limit, PTI made a claim with General Star under the excess liability policy. General Star disclaimed any coverage obligation. When this suit was brought, the district court granted summary judgment in favor of General Star on the breach of contract claim and dismissed the chapter 93A, section 11 claim with prejudice. The First Circuit reversed, holding (1) the excess policy was ambiguous; and (2) because ambiguity in the policy must be construed in favor of the insured, coverage was available to PTI. View "Performance Trans., Inc. v. General Star Indemnity Co." on Justia Law

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Tokiko Johnson's real property was damaged in a storm and she filed a claim with her insurance company. Johnson also executed an assignment of her insurance claim for the purpose of repairing the property with the execution in favor of Triple Diamond Construction LLC (the construction company). An appraiser retained by the construction company determined storm damage to the property in the amount of $36,346.06. The insurer determined the amount of damage due to the storm was $21,725.36. When sued, the insurer argued the insured property owner was required to obtain written consent from the insurer prior to making the assignment. The Oklahoma Supreme Court determined an insured's post-loss assignment of a property insurance claim was an assignment of a chose in action and not an assignment of the insured's policy. Therefore, the insured's assignment was not prohibited by either the insurance policy or 36 O.S. section 3624. Judgment was reversed and the matter remanded for further proceedings. The insurer's motion to dismiss the appeal was thus denied. View "Johnson v. CSAA General Insurance Co." on Justia Law

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Defendant Gemini Insurance Company appealed a district court's holding La. C.C. arts. 2315.1, 2315.2 and 199 were “unconstitutional as applied to children given in adoption” and overruling the defendants’ peremptory exceptions of no right of action. At issue was whether plaintiffs Daniel Goins and David Watts, two adult children who were given in adoption as minors, had a right to bring wrongful death and survival actions stemming from the deaths of their biological father and his two minor children, who were not given in adoption, and were plaintiffs’ biological half-siblings. After a de novo review, based on the clear and unambiguous wording of La. C.C. arts. 2315.1 and 2315.2, the Louisiana Supreme Court concluded Goins and Watts were “children of the deceased” and “brothers of the deceased” who were permitted to bring wrongful death and survival actions arising from the death of their biological father and half-siblings. In view of the Court's holding that plaintiffs had a right to assert survival and wrongful death actions, the Court declined to address their argument that La. C.C. arts. 2315.1, 2315.2 and 199 were unconstitutional as applied to children given in adoption. View "Rismiller v. Gemini Insurance Co." on Justia Law