Justia Insurance Law Opinion Summaries

Plaintiffs Candice Reis and Melvin Williams appealed the grant of summary judgment to defendant OOIDA Risk Retention Group, Inc. (“OOIDA”) in a direct action against OOIDA and others arising from a vehicular collision involving Plaintiffs and a motor carrier insured by OOIDA. At issue was whether provisions in the federal Liability Risk Retention Act of 1986 (“the LRRA”), 15 USC 3901, et seq., preempted Georgia’s motor carrier and insurance carrier direct action statutes, OCGA sections 40-1-112 (c),1 40-2-140 (d) (4), in regard to risk retention groups, thereby precluding this direct action against OOIDA. After review of the statutes at issue here, the Georgia Supreme Court concluded there was indeed federal preemption of this action against OOIDA, and consequently, affirmed summary judgment. View "Reis et al. v. OOIDA Risk Retention Group, Inc. et al." on Justia Law

Nielsen Contracting, Inc. and T&M Framing, Inc. (collectively Nielsen) sued several entities (defendants) alleging these entities fraudulently provided workers' compensation policies to Nielsen that were illegal and contained unconscionable terms. Defendants moved to compel arbitration and stay the litigation under an arbitration provision in one defendant's contract, titled Reinsurance Participation Agreement (RPA). Nielsen opposed the motion, asserting the arbitration provision and the provision's delegation clause were unlawful and void. After briefing and a hearing, the trial court agreed and denied defendants' motion. Defendants appealed, arguing: (1) the arbitrator, and not the court, should decide the validity of the RPA's arbitration agreement under the agreement's delegation clause; and (2) if the court properly determined it was the appropriate entity to decide the validity of the delegation and arbitration provisions, the court erred in concluding these provisions are not enforceable. The Court of Appeal rejected these contentions and affirmed. View "Nielsen Contracting, Inc. v. Applied Underwriters, Inc." on Justia Law

The three-year statute of limitations set forth in N.Y. C.P.L.R. 214(2) applies to no-fault claims against a self-insurer.Girtha Butler sustained personal injuries in a motor vehicle accident involving a New York City Transit Authority (Defendant) bus in which she was a passenger. Plaintiff provided health services to Butler for her injuries, and Butler assigned to Plaintiff her right to recover first-party benefits from Defendant, who was self-insured. Plaintiff then brought this action seeking reimbursement for allegedly outstanding invoices it had submitted to Defendant. Defendant moved to dismiss the complaint based on Plaintiff’s failure to bring the action within the three-year statute of limitations under N.Y. C.P.L.R. 214(2). Civil Court denied the motion, ruling that the six-year statute of limitations set forth in N.Y. C.P.L.R. 213(2) controlled this case. The Court of Appeals reversed, holding that the three-year period of limitations in N.Y. C.P.L.R. 214(2) should control this case. View "Contact Chiropractic, P.C. v. New York City Transit Authority" on Justia Law

Defendant Allstate Insurance Company appealed a superior court order granting the motion for partial summary judgment filed by plaintiff Joseph Rizzo, and denying the cross-motion for partial summary judgment filed by Allstate. Rizzo alleged he was injured in an automobile accident while a passenger in a car insured by Allstate. Rizzo sought uninsured motorist coverage under the Allstate policy, and, after Allstate denied his claim, the claim went to arbitration. The uninsured motorist provision in the Allstate policy provided that if the arbitration award exceeded $25,000, the financial responsibility limit in New Hampshire, the insured and Allstate had the right to elect a trial de novo following arbitration. Allstate rejected the arbitration award, which exceeded the financial responsibility limits, and requested a trial de novo. The trial court ruled that the trial de novo provision in the policy was not enforceable because it was unconscionable, ambiguous, and violated public policy, and confirmed the arbitration award. The New Hampshire Supreme Court concluded the trial de novo provision did not contravene New Hampshire public policy regarding arbitration. Nor did the Supreme Court find the trial de novo provision unconscionable. Accordingly, the Court reversed and remanded for further proceedings. View "Rizzo v. Allstate Insurance Company" on Justia Law

The Court of Appeals correctly applied the principles of Cincinnati Insurance Co. v. Motorist Mutual Insurance Co., 306 S.W.3d 69 (Ky. 2010), to hold that a contractor’s faulty workmanship on the basement and foundation of an existing structure, which resulted in extensive damage to the entire building, was not an accident triggering coverage as an occurrence under the contractor’s commercial general liability (CGL) insurance policy.The policy provided that the insurer (Insurer) would pay for property damage if it resulted from an “occurrence.” The trial court ruled that Plaintiff could recover from Insurer under the policy for the damage to the structure above the basement level because the damage was an unexpected and unintended consequence of the contractor’s faulty work on the basement. The court of appeals reversed, ruling that none of the structural damage qualified as an accident triggering coverage as an occurrence under Insurer’s CGL policy. The Supreme Court affirmed, holding that the trial court failed to focus on the proper elements from Cincinnati. View "Martin/Elias Properties, LLC v. Acuity, a Mutual Insurance Co." on Justia Law

A-1 Self Storage Inc.’s alternative indemnity agreement was not subject to regulation under the Insurance Code because (1) A-1 was not acting as an agent for an insurer, and (2) the indemnification agreement was incidental to the principal object and purpose of renting storage space. See Cal. Ins. Code 1758.7 et seq.In its rental agreements with tenants, A-1 required the tenant to obtain insurance for loss of or damage to a tenant’s stored property, stating that A-1 shall not be liable for such losses. A-1 also offered an alternative to the requirement that the tenant obtain insurance. In exchange for an additional amount in rent per month, A-1 provided that it would reassume the risk of such losses, up to $2,500. Plaintiff brought this putative class action arguing that the alternative constituted an insurance policy, which A-1 was not licensed to sell, and therefore, A-1’s sale of this indemnity agreement violated the Insurance Code. The trial court concluded that the alternative indemnity agreement was not insurance and entered judgment for Defendants. The court of appeal affirmed. The Supreme Court affirmed, holding that the alternative indemnity agreement did not constitute insurance subject to regulation under the Insurance Code. View "Heckart v. A-1 Self Storage, Inc." on Justia Law

The Court of Appeal reversed the trial court's entry of judgment for Gursey in an action alleging that plaintiffs had been damaged because they could not collect the additional money they would have been entitled to had Gursey purchased an insurance policy with the limits they had requested. The court held that plaintiffs did not incur actual damages until they became entitled to the benefits of the underinsured motorist policy. Consequently, plaintiffs' causes of action against Gursey accrued less than two years before they filed this action, and the trial court erred in holding that plaintiffs' claims were time-barred. View "Lederer v. Schneider" on Justia Law

In 2012, Dr. Jacobs hired All Green to perform electrical work for Jacobs’s MRI and X-ray facility, including a room in which a mammography unit was to be installed. Hologic installed that unit but discovered it was not operating correctly due to a magnetic field in the room. All Green ran power to another room but the magnetic field persisted; the unit continued to malfunction. The magnetic field continued to interfere with the unit's operation after installation of steel shielding. Jacobs then hired an electromagnetic field expert who determined that the problem was caused by a loose bolt in an electrical cabinet installed by All Green. When the bolt was tightened, the magnetic field instantly disappeared. Jacobs filed suit. All Green tendered defense of the lawsuit to its insurer, SNIC, under policies covering bodily injury and property damage liability. All Green denied the allegations of negligence, stating that all bolts had been properly tightened and that its work had passed two inspections. SNIC denied the claim citing the “impaired property” exclusion. The court of appeal affirmed summary judgment, holding that SNIC had no duty to defend. If Jacobs’s allegations were found true, SNIC would not have to indemnify, nor would SNIC have to indemnify if, as All Green contended, it was not responsible for the loose bolt. View "All Green Electric, Inc. v. Security National Insurance Co." on Justia Law

“Covered persons” as used in Mass. Gen. Laws ch. 176I, 11 refers solely to natural persons who, as employees, receive insurance coverage for health care services under a group insurance plan, rather than employer entities.At issue in this case was whether, when an employer purchases insurance on behalf of its employees, the insurer owes tax on premiums paid by on or behalf of only those individuals who live in Massachusetts or whether the insurer owes tax on all premiums received from the Massachusetts-based employer regardless of where its individual employees reside. The Supreme Judicial Court affirmed the judgment of the Appellate Tax Board, holding that the term “covered persons” in section 11 refers to the natural person receiving health care coverage under a preferred provider arrangement policy, including his or her spouse and additional dependents, not the employer-organization with whom the insurer contracts. View "Dental Service of Massachusetts, Inc. v. Commissioner of Revenue" on Justia Law

Plaintiff Robert Ferrante was involved in an automobile accident in 2006 where the other motorist caused the collision. Without informing his auto insurance carrier, defendant New Jersey Manufacturers Insurance Group (“NJM”), Ferrante initiated a negligence lawsuit against the tortfeasor, who had a liability limit of $100,000 on his insurance policy. The parties participated in mandatory arbitration, which set Ferrante’s damages at $90,000. Again, without informing NJM and allowing it to exercise its subrogation rights, Ferrante rejected the award, and sought a trial de novo. He also refused a $50,000 settlement offer without notifying NJM. Prior to the trial, Ferrante entered into a high-low agreement with the tortfeasor, which set the range of damages between $25,000 and $100,000, notwithstanding a jury verdict. Ferrante did not communicate this agreement or the trial itself to NJM, either. Following the trial, a jury awarded plaintiff $200,000 in damages, but the Law Division entered a judgment of $100,000 based on the high-low agreement. For the first time in 2011, Ferrante sent NJM a letter required by Longworth v. Van Houten, 223 N.J. Super. 174 (App. Div. 1988), stating that he was seeking UIM benefits. In the letter, Ferrante wrote that the other motorist was willing to settle for $100,000. However, Ferrante failed to mention the arbitration, high-low agreement, completed trial, or jury verdict. Based on this information, NJM told Ferrante to accept the offer. NJM and Ferrante proceeded to litigation over UIM coverage; only during a pretrial discovery exchange did Ferrante finally disclose his past dealings. NJM moved to dismiss the complaint, and the Law Division granted the motion, finding that Ferrante violated Longworth by not notifying NJM of any of the proceedings with the other motorist. On appeal, a split panel of the Appellate Division reversed. The majority held that because the trial court did not consider if NJM was actually prejudiced by the lack of notice, a remand was needed to determine if NJM sustained any prejudice. The New Jersey Supreme Court reversed: due to the complete absence of notice by Ferrante to NJM at any point over years of litigation, including the lack of notice about the high-low agreement or completed jury trial during the UIM process, NJM could refuse to pay the UIM benefits. View "Ferrante v. New Jersey Manufacturers Insurance Group" on Justia Law