Justia Insurance Law Opinion Summaries

Kienstra, a Missouri resident, received treatment for uterine fibroid tumors at the Mayo Clinic in 2008. Her health plan concluded that her treatment fell outside the plan's coverage as experimental and requiring prior approval. Internal appeals failed. The plan is a self-funded multiple employer plan, maintained pursuant to collective bargaining agreements, and subject to the Employee Retirement Income Security Act, 29 U.S.C. 1002(1). The plan specified that any civil action for wrongful denial of medical benefits under ERISA must be filed within two years of the final date of denial. Kienstra filed suit almost two and a half years after she learned her claim had been denied. She unsuccessfully argued that the contractual limitations period was invalid because the plan's rules of construction stated that its terms should be read to comply with Missouri law, that a 10-year Missouri statute of limitations governed, and that a separate statute barred contracting parties from shortening that limitations period. The Eighth Circuit affirmed. There is no conflict between the plan's contractual limitations period and Missouri law; state law does not "apply of its own force to a suit based on federal law—especially a suit under ERISA, with its comprehensive preemption provision." View "Munro-Kienstra v. Carpenters' Health & Welfare Trust Fund of St. Louis" on Justia Law

Plaintiff filed suit against State Farm, seeking damages based on an uninsured motorist claim, bad-faith denial of the claim, and conversion. The district court granted summary judgment to State Farm and granted State Farm's motion to amend the judgment after a jury verdict on compensatory damages. The court concluded that plaintiff has not shown a genuine dispute of material fact that would have justified the denial of summary judgment on the claim of bad faith in refusing to offer payment of the policy limit on his claim; because State Farm has an arguable basis for the denial of plaintiff's claim for policy limits, the court need not consider whether the conduct was sufficiently egregious to rise to the level of an independent tort; and State Farm did not waive its argument that plaintiff's damages could not be more than that of the policy limit because it moved to have evidence of the policy limit excluded at trial. Accordingly, the court affirmed the judgment. View "Dey v. State Farm Mutual Auto Ins. Co." on Justia Law

Charles and Deborah Bate were both seriously injured in a head-on vehicle collision. After obtaining a judgment against the driver of the opposing vehicle the Bates sued Greenwich Insurance Company seeking underinsured motorist coverage under a policy allegedly issued to Charles Bate’s employer by Greenwich. Greenwich did not answer the petition, and the Bates obtained a default judgment in the amount of $3 million. More than two years later, Greenwich filed an amended motion to set aside the default judgment as void, arguing that service of process was invalid. The trial court set aside the default judgment as void, stating that there was no valid service of process. The Supreme Court reversed, holding that the Bates properly effected service of process under Mo. Rev. Stat. 375.906 and complied with all service requirements of that statute. View "Bate v. Greenwich Ins. Co." on Justia Law

The West Virginia State Treasurer separately filed sixty-three complaints against insurance companies doing business in West Virginia, alleging that the insurers unlawfully retained life insurance proceeds unclaimed by state residents in contravention of the West Virginia Uniform Unclaimed Property Act of 1997. The circuit court dismissed the complaints for failure to state a claim, concluding that the insurer should be permitted to retain the proceeds of the insured’s life insurance policy until someone having a contractually derived interest makes a formal claim in accordance with the policy. The Supreme Court reversed, holding that the Act requires insurers, as holders of property presumed abandoned, to account for and turn over that property to the Treasurer. View "State ex rel. Perdue v. Nationwide Life Ins. Co." on Justia Law

Tenth-grader Jesus Rodriguez was injured while traveling to a soccer match in the bed of a pickup truck driven by a fellow student and teammate. Mutual of Omaha Insurance Company had issued a policy to the Kansas State High School Activities Association, which administered various extracurricular activities in the state. Rodriguez’s mother (Plaintiff) filed a claim with Mutual of Omaha. Mutual of Omaha denied the claim, reasoning that the travel during which Rodriguez was injured did not qualify as covered under the policy. Plaintiff sued the school district, Mutual of Omaha, and other defendants. The district judge held that Mutual of Omaha should be dismissed as a defendant in the case because Rodriguez’s travel was neither authorized by the school district nor subject to reimbursement, the two requirements for “covered travel” under the definition in the Mutual of Omaha policy. The court of appeals affirmed, holding that the travel involved in this case did not qualify as subject to reimbursement, and thus there was no coverage under the policy. The Supreme Court reversed, holding that the travel during which Rodriguez was injured was “authorized” and “subject to reimbursement,” and therefore, there was coverage under the policy language. View "Rodriguez v. United Sch. Dist. No. 500" on Justia Law

Candelario Lopez, who was hired by Interstate Treating to work on the installation of a gas processing plant, was transporting two other Interstate Treating employees to the job site when he died in an automobile accident. Lopez’s wife, Maximina Lopez, sought death benefits from Interstate Treating’s workers’ compensation insurance carrier, SeaBright Insurance Co. SeaBright denied coverage, concluding that Lopez was not acting in the course and scope of his employment at the time of the accident. A hearing officer, however, determined that Lopez was acting in the course and scope of his employment and ordered SeaBright to pay death benefits. The trial court affirmed the administrative decision. The court of appeals affirmed the trial court’s judgment. The Supreme Court affirmed, holding that Lopez was acting in the course and scope of his employment when he died, and Maximina was entitled to benefits. View "Seabright Ins. Co. v. Lopez" on Justia Law

Zierle was driving and rear-ended Wolfe. Zierle’s blood alcohol level tested at 0.25%. Zierle had three prior DUIs. Wolfe required treatment at the emergency room. Zierle was insured by Allstate. Zierle’s policy stated that Allstate would not defend an insured for damages not covered by the policy. Zierle’s policy excluded coverage for punitive damages. Wolfe made a settlement demand of $25,000. Allstate counteroffered $1200. Wolfe filed suit. Allstate informed Zierle that he could face damages above the $50,000 policy limit and would be personally liable for the excess. During discovery, Wolfe learned of the extent of Zierle’s intoxication and added a claim for punitive damages. During settlement conferences, judges placed a value of $7500 on the compensatory damage claim. After trial, Allstate paid $15,000 in compensatory damages, but not a $50,000 punitive damages award. Zierle assigned his rights against Allstate to Wolfe, who sued, alleging breach of contract; bad faith; and violation of Pennsylvania’s Unfair Trade Practices Consumer Protection Law. The court denied Allstate’s motions for summary judgment, which argued that, since it had no duty to indemnify for punitive damages, it was not required to consider potential punitive damages when deciding whether to settle and that indemnification for punitive damages was impermissible under Pennsylvania law. The jury found violation of Pennsylvania’s bad faith statute and breach of contract; it awarded no compensatory damages, but $50,000 in punitive damages. The Third Circuit vacated and remanded for a new trial at which Wolfe will be barred from introducing evidence of the punitive damages award, affirming the denials of summary judgment. View "Wolfe v. Allstate Prop. & Cas. Ins. Co." on Justia Law

While keeping perishable foodstuffs at Economy International Systems, Inc., a cold-storage facility, Appellants lost more than one million dollars when the walk-in freezers at Economy malfunctioned. Appellants sought recovery under Economy’s insurance policy issued by Triple-S Propiedad, Inc. (“Triple-S”). The parties agreed that the policy provided coverage in this case, but the parties disagreed as to the amount of coverage. Appellant believed it was entitled to $500,000, and Triple-S stated that Appellant was only entitled to $25,000. Invoking diversity jurisdiction, Appellant filed suit against Triple-S seeking a ruling that it may recover $500,000 under the policy. The magistrate judge concluded that the policy’s coverage for losses caused by equipment breakdown was limited to $25,000. The First Circuit affirmed, holding that the most Appellant could recover for Economy’s loss of Appellant’s perishable goods was $25,000. View "AJC Logistics, LLC v. Triple-S Propiedad" on Justia Law

In 2010, Advance obtained a policy from Cincinnati Insurance on Middleton properties. After a 2011 hailstorm, Larson, Advance’s president, filled out a form reporting damage. Larson inspected the roof with Jorgenson, a Cincinnati claims representative. Jorgenson’s estimate “note[d] some dents to soft metal roof vents and AC fins but stated that he “did not observe any damage to roofing.” Jorgenson estimated $1,894.74 for repairs and sent Larson a check, calculating a $1,000 deductible. Six months later, Advance was considering selling the building. The potential buyer, Welton, had the roof inspected. The inspector’s report prompted Advance to ask Jorgenson to reopen Advance’s claim. He arranged for a new inspection. The resulting report noted roof panel denting that “will not affect the performance of the panels (roofs) or detract from the panels[’] (roofs[’]) life expectancy.” Months later, Advance sold the building, without any further developments relating to its claim. Advance sued. The district court held that the policy did cover the hail damage, but that Cincinnati’s refusal to acknowledge coverage was not in bad faith. The parties stipulated to the cost of a replacement roof, $175,500. The court entered a final judgment in that amount in favor of Advance. The Seventh Circuit affirmed. View "Advance Cable Co., LLC v. Cincinnati Ins. Co." on Justia Law

In 2010, two miners died in a mining accident while employed by Webster County Coal, LLC. That same year, another miner died in a mining accident while employed by River View Coal, LLC. Both River View and Webster County were wholly owned subsidiaries of Alliance Coal LLC, the parent company. Alliance, which had obtained a self-insurance contract, guaranteed payment of benefits under the Workers’ Compensation Act in the event its subsidiaries failed to pay benefits. Webster County and River View accepted the workers’ compensation claims made on behalf of the surviving widows and children of the deceased miners, and Alliance paid the benefits. Appellants filed lawsuits against Alliance alleging that it had liability for the miners’ deaths. The trial court granted summary judgment for Alliance, concluding that it had immunity under the Act. The court of appeals affirmed. The Supreme Court affirmed, holding that a parent company that completely self-insures the liability of its subsidiary is a carrier and immune from tort liability. View "Falk v. Alliance Coal, LLC" on Justia Law