Justia Insurance Law Opinion Summaries

After discovering a number of defects in their home, plaintiffs Hugh and Katherine Carithers filed suit against their homebuilder, Cronk Duch, in state court. Cronk Duch’s insurance company, Mid-Continent Casualty Company, refused to defend the action on behalf of Cronk Duch. The Carithers and Cronk Duch then entered into a consent judgment in the underlying action for approximately $90,000, in favor of the Carithers. The consent judgment also assigned to the Carithers Cronk Duch’s right to collect the judgment amount from Mid-Continent. The Carithers then filed this action against Mid-Continent in state court to collect from Mid-Continent on the settlement. Mid-Continent removed the case to the Middle District of Florida. The Carithers are the Plaintiffs in this action due to Cronk Duch’s assignment of its rights to them. The Fifth Circuit, after careful consideration, affirmed in part, and reversed in part, addressing a number of coverage issues related to damage from the completed house caused by the defective work of subcontractors. View "Carithers v. Mid-Continent Casualty Company" on Justia Law

Plaintiff bought the property in 2007. The last tenants moved out in 2010. Gas and electric utilities were turned off. In 2011, Plaintiff submitted a claim to Fire Insurance Exchange for a fire at the property. Exchange retained a fire investigator, who reported, “it appears the fire may have been initiated as the result of an uncontrolled warming fire started by an unauthorized inhabitant. Signs of possible habitation were present and the relatively isolated location would permit this. … firewood … and the mattress next to the large hole in the floor also supports this theory.” The property did not have a fireplace. The claims adjuster concluded “Likely transient in house and warming fire got out of hand.” The policy did not “cover direct or indirect loss from: . . . Vandalism or Malicious Mischief, breakage of glass and safety glazing materials if the dwelling has been vacant for more than 30 consecutive days just before the loss.” Vandalism is not defined in the policy. After denial of the claim, Plaintiff filed a complaint for breach of contract and insurance bad faith. The trial court granted Exchange summary adjudication. The court of appeal reversed, finding that the exclusion did not apply. View "Ong v. Fire Ins. Exch." on Justia Law

Appellant Tommie Patterson was injured in a hit-and-run accident and sued his car insurance company claiming it had breached his insurance contract by failing to reasonably compensate him for his injuries. He later moved to amend his complaint to include racketeering, embezzlement, mail fraud, and bad faith claims, but the superior court denied the motion. A jury returned a liability verdict that was smaller than the insurance company's offer of judgment. The superior court ruled that the insurance company was the prevailing party and awarded attorney's fees and costs. Patterson appealed the denial of his motion to amend, the awarding of attorney's fees and costs, and several of the court's other procedural and evidentiary rulings. Finding no abuse of discretion in the court's rulings, the Alaska Supreme Court affirmed the judgment. View "Patterson v. GEICO General Insurance Company" on Justia Law

Petitioner Terry Ann Bartlett was injured in a motor vehicle accident in New York in August 2004, when the motorcycle owned and operated by Jeffrey Vilagos on which she was a passenger, was struck by a motor vehicle operated by Myroslaw Mykijewycz. Mykijewycz was insured by Allstate Insurance Company under a policy that provided liability insurance coverage up to $100,000 per person. Vilagos's motorcycle, which was registered and garaged in New Jersey, was insured by respondent Foremost Insurance Company. The Foremost policy was issued in New Jersey and provided uninsured/underinsured motorist (UIM) coverage up to $250,000 per person. Petitioner also owned a motorcycle, which was registered and garaged in New Hampshire, and which was insured by respondent Progressive Northern Insurance Comapny under a policy that also provided UIM coverage up to $250,000 per person. Petitioner's other vehicles, which were both registered and garaged in New Hampshire, were insured by respondent Commerce Insurance Company under a policy that provided UIM coverage up to $250,000 per person. Petitioner's home was also insured by Commerce under a policy that contains a personal umbrella endorsement that provides $1,000,000 of single limited UIM coverage. Petitioner's New York attorney requested coverage information from Foremost, which Foremost provided. In April 2005, petitioner's attorney informed Progressive and Commerce that the petitioner intended to pursue UIM claims. Allstate offered petitioner its policy limit ($100,000). Petitioner's attorney notified Foremost, Progressive and Commerce of this fact and advised the respondent-insurers that, pursuant to New York law, they were either "required to grant [petitioner] permission to collect" the $100,000 from the Allstate policy "or to pay [her] [that] amount] within thirty (30) days." However, the New York law to which the attorney referred did not govern any of the insurers. Only Commerce responded to petitioner's attorney, granting petitioner permission to settle with Allstate. Allstate was thereafter released from liability. Petitioner sued Foremost, Progressive, and Commerce in New York in January 2011, more than six years after the accident. That lawsuit was eventually dismissed. While the insurers' motions to dismiss were pending, petitioner filed the underlying petition in this case for declaratory judgment. She moved, and the insurers cross-moved, for summary judgment. Commerce appealed, and petitioner cross-appealed the Superior Court's order partially granting and partially denying petitioner's summary judgment motion, denying Commerce's cross-motion for summary judgment, and granting cross-motions for summary judgment filed by Foremost and Progressive. Upon review, the Supreme Court affirmed the trial court's determination that petitioner forfeited her right to recover primary insurance coverage under the Foremost policy and her right to recover excess insurance coverage under the Progressive policy and reversed its conclusion that Commerce had to "drop down" to provide primary coverage. The case was remanded for further proceedings. View "Bartlett v. Commerce Ins. Co." on Justia Law

Insurer Cincinnati Specialty Underwriters Insurance Company appealed a trial court's order granting summary judgment to defendants Energy Wise, Inc. and Michael and Shirley Uhler in this declaratory-judgment action. Energy Wise was a Vermont corporation that specialized in insulating buildings and homes. It purchased a commercial general liability (CGL) policy from insurer, effective March 1, 2010 to March 1, 2011. In late 2010, Energy Wise installed spray-foam insulation at the Shrewsbury Mountain School. A school employee, Shirley Uhler, and her husband later filed suit against Energy Wise. Ms. Uhler asserted that she was "exposed to and encountered airborne chemicals and airborne residues" from the spray-foam insulation and suffered bodily injury as a result. The Uhlers raised claims of negligence, res ipsa loquitur, and loss of consortium. Energy Wise requested coverage under its CGL policy, and insurer agreed to defend Energy Wise under a bilateral reservation of rights. In September 2012, insurer filed a complaint for declaratory judgment, asserting that its policy did not cover the claims at issue. Insurer cited the "Total Pollution Exclusion Endorsement" in its policy, which excluded coverage for "[b]odily injury . . . [that] would not have occurred in whole or in part but for the actual, alleged or threatened discharge, dispersal, seepage, migration, release or escape of ‘pollutants' at any time." Insurer argued that the court should have granted summary judgment in its favor because the "total pollution exclusion" in its policy plainly and unambiguously precludes coverage in this case. After review, the Supreme Court agreed with insurer, and therefore reversed the trial court's decision and remanded with instructions to enter judgment in insurer's favor. View "Cincinnati Specialty Underwriters Ins. Co. v. Energy Wise Homes, Inc." on Justia Law

The plaintiffs' complaint alleged that two groups of defendants, (1) Premera, Premera Blue Cross, and Life Wise Health Plan of Washington (collectively Premera) and (2) the Washington Alliance for Healthcare Insurance Trust and its trustee, F. Bentley Lovejoy (collectively WAHIT), colluded and made false and misleading representations to the plaintiffs that induced the plaintiffs to purchase health insurance policies under false pretenses. Plaintiff-policyholders claimed that Premera and WAHIT violated the Washington Consumer Protection Act (CPA). The plaintiffs requested only two specific forms of damages: (1) for the "unfair business practices and excessive overcharges for premiums," the plaintiffs requested "the sum of the excess premiums paid to the defendants;" and (2) "[i]f the surplus is excessive and unreasonable," the plaintiffs asserted that "the amount of the excess surplus should be refunded to the subscribers who have paid the high premiums causing the excess." On Premera and WAHIT's motion, the trial court dismissed the Policyholders' suit in its entirety based on the filed rate, primary jurisdiction, and exhaustion of remedies doctrines. Specifically, the trial court dismissed all claims of class B (small group) and class C (individuals) pursuant to CR 12(b )( 6) and dismissed all claims of class A (large group) on summary judgment under CR 56. The Court of Appeals reversed the trial court in relation to certain of the Policyholders' CPA claims. Because awarding the specific damages requested by the plaintiffs would require a court to inappropriately substitute its judgment for that of the Office of the Insurance Commissioner (OIC), the Supreme Court affirmed the trial court's dismissal of the plaintiffs' claims. View "McCarthy Fin., Inc. v. Premera" on Justia Law

Employee was injured in an automobile accident during the course of his employment with Employer. Employer and its Insurer paid workers’ compensation benefits. Employee subsequently settled a claim against the other driver involved in the accident. From that settlement, Employee reimbursed Insurer for the workers’ compensation benefits already paid out at the time of the settlement. The remaining amount of the settlement was determined to be “like damages” for which Employer and Insurer would receive an offset against future medical expenses related to the work injury. Thereafter, Employee submitted bills for ongoing care related to the work injury to his insurers, which paid the bills. Employee then filed a petition requesting workers’ compensation benefits. Employer and Insurer denied benefits, asserting that the amounts paid by other insurers could not be used to reduce the offset against future medical expenses. An administrative law judge and the circuit court concluded that medical expenses paid by Employee’s insurance were properly used to reduce the offset. The Supreme Court affirmed, holding that although Employee’s insurance paid medical bills resulting from his compensable injury, those payments were properly considered to reduce the offset because Employee would otherwise be entitled to receive compensation for those expenses. View "Milbrandt v. Bibb’s, Inc." on Justia Law

On April 24, 2008, Defendant ran a stop sign and struck Plaintiff’s vehicle, causing significant physical injuries. Plaintiff received basic reparations/personal injury protection benefits (PIP) from her insurer, Cincinnati Insurance Company (CIC). On September 21, 2011, Plaintiff filed her complaint. The circuit court dismissed Plaintiff’s claims with prejudice. At issue on appeal was when the last payment was made by the CIC. The CIC issued a check to a physical therapist on March 17, 2009 that was either received or lost and then issued a replacement check on September 25, 2009. The Court of Appeals affirmed the circuit court, concluding that a replacement check does not constitute making payment. The Supreme Court reversed, holding that the September 2009 check was the last “payment” of PIP. Remanded. View "Beaumont v. Zeru" on Justia Law

The home of Keith Conley was insured through an insurance policy issued by Kentucky Farm Bureau Mutual Insurance Company. Conley’s son fatally murdered his girlfriend, Jessica Newsome, in Conley’s home. Gregory and Loretta Newsome brought a wrongful death action against Conley for damages arising from Jessica’s death. Kentucky Farm Bureau provided a defense to Conley for the Newsomes’ claims against him and intervened in the action seeking a declaration that the policy did not provide coverage to Conley for the claims arising from Jessica’s murder. The trial court ruled that the homeowner’s policy provided coverage for Conley’s acts. Kentucky Farm Bureau subsequently filed a Ky. R. Civ. P. 59.05 motion asking the court to alter or amend its order. The trial court denied the motion. Kentucky Farm Bureau then filed a notice of appeal. The Court of Appeals dismissed the appeal, concluding that the Rule 59.05 motion was deficient due to a lack of “particularity” and therefore failed to toll the time for filing a notice of appeal. The Supreme Court reversed, holding that, although Kentucky Farm Bureau’s Rule 59.05 motion did not strictly adhere to the particularity requirement of Ky. R. Civ. P. 7.02, the defect was not so serious that it should have been stricken. View "Ky. Farm Bureau Ins. Co. v. Conley" on Justia Law

Plaintiff obtained an Standard Flood Insurance Policy from Middlesex Mutual Assurance Company that afforded flood coverage for Plaintiff’s home. The Policy excluded coverage for damage occurring in a “basement.” After a flood caused damaged to the lower level of his home, Plaintiff filed two flood claims claims to the adjuster retained by Middlesex Mutual. Middlesex Mutual paid the smaller claim but rejected the larger claim, concluding that the lower level of Plaintiff’s home was a “basement” under the Policy. Plaintiff appealed. The district court granted summary judgment for Middlesex Mutual. The First Circuit affirmed, holding that the lower level of Plaintiff’s home qualified as a “basement” under the Policy, and thus Middlesex Mutual appropriately denied his claim of loss for damages sustained during the flood. View "Matusevich v. Middlesex Mut. Assurance Co." on Justia Law