Justia Insurance Law Opinion Summaries

Claimant Johnny Adger suffered an accidental injury to his left knee on while working as a police officer with the Manning Police Department. As a result, he was treated using various non-operative methods, including steroid injections. In January 2008, Claimant reached maximum medical improvement (MMI) and was assigned a 32% permanent impairment rating to his lower left extremity. However, in April 2008, Claimant returned to the doctor because he continued to experience swelling and pain in his left knee. Ultimately, Claimant underwent knee replacement surgery. Claimant continued to experience swelling and pain in his left knee, and Claimant followed up with the orthopaedic center for several months after the surgery. At the time of his injury, Claimant suffered from preexisting diabetes, which Claimant's employer was aware of prior to the injury. Claimant experienced problems with his diabetes for years before the accident and required medication to control the condition. Claimant's diabetes was medically controlled around the time of the injury; however, Claimant's diabetes was uncontrolled on several occasions during the course of his knee treatment. The State Accident Fund appealed an order from the Appellate Panel of the South Carolina Workers' Compensation Commission denying its request for reimbursement from the South Carolina Second Injury Fund for benefits paid to Claimant. The Supreme Court reversed and remanded. The Commission denied Appellant's claim for reimbursement in full. Without mentioning medical payments, the Commission stated that "Claimant's preexisting diabetes did not create substantially greater liability for permanent disability nor did it result in substantially greater lost time from work." However, these facts fell under the compensation liability prong of the applicable statute. Furthermore, the Supreme Court found that the Commission ignored expert opinion that Claimant's injury most probably aggravated his diabetes and resulted in substantially greater medical costs than would have resulted from his work-related injury alone. The Second Industry Fund presented no evidence or expert opinion that contradicted the statement concerning medical costs. Therefore, based on the fact that the medical evidence supported the conclusion that the Claimant's work-related injury aggravated his diabetes and resulted in increased medical costs, the Court held that the State Accident Fund satisfied the requirements of section 42-9-400(a), and the Commission's decision to deny its claim for reimbursement of medical payments was clearly erroneous. View "State Accident Fund v. SC Second Injury Fund" on Justia Law

The widow of a man killed in an automobile accident with an uninsured motorist (UM) sued her and her husband’s automobile liability insurance carrier seeking UM coverage for her husband’s wrongful death. The trial court granted summary judgment for the insurer, ruling that the insurer’s liability was limited to an “owned-vehicle” partial exclusion in the couple’s policies that limited coverage when the insured was injured while occupying a vehicle owned by the insured but not covered by the policy. The Supreme Court affirmed, holding that, because the partial exclusion was clear and unambiguous, the trial court did not err in finding that the partial exclusion limited the insurer’s liability in this case.View "Floyd-Tunnell v. Shelter Mut. Ins. Co." on Justia Law

The health care service plan in this case, Kaiser Permanente, covered three patients who received care at an emergency room operated by Dameron Hospital Association. The patients were injured due to the negligence of third party tortfeasors who had automobile liability insurance with California Automobile Association Inter-insurance Bureau (AAA) and Allstate Insurance Company. Unlike Kaiser, neither AAA nor Allstate had contracts with Dameron. In the absence of an agreement for negotiated billing rates, Dameron sought to collect from AAA and Allstate its customary billing rates by asserting liens filed under the Hospital Lien Act (HLA). AAA and Allstate, however, ignored Dameron’s HLA liens when paying settlements to the three Kaiser patients. Upon learning of the settlements, Dameron sued AAA and Allstate to recover on its HLA liens. The trial court granted insurers’ motions for summary judgment on grounds the patients’ debts had already been fully satisfied by their health care service plans. Reasoning the HLA liens were extinguished for lack of any underlying debt, the trial court dismissed the case. The trial court further found dismissal was warranted because Dameron failed to timely file some of its HLA liens against AAA. The question this case presented to the Court of Appeal was whether the health care service plan’s payment of a previously negotiated rate for emergency room services insulated the tortfeasor’s automobile liability insurer from having to pay the customary rate for medical care rendered. AAA and Allstate argued they were not responsible for any amount after Kaiser paid in full the bill for the emergency room services provided by Dameron. Dameron argued that it contracted with Kaiser to preserve its rights to recover the customary billing rates from tortfeasors and their automobile liability insurers, and that the tortfeasors and their liability insurers were responsible for the entire bill for medical services at the customary rate - not just the difference between the reimbursement received from Kaiser and the customary billing rate. The Court of Appeal concluded that the Dameron/Kaiser contract did not contain the term described by case law as sufficient to preserve the right to recover the customary billing rate for emergency room services from third party tortfeasors. Consequently, the trial court properly granted summary judgment in favor of AAA and Allstate. View "Dameron Hosp. Assn. v. AAA Nor. Cal., Nev. & Utah Ins. Exc." on Justia Law

In 1994, the State contracted with Lombardo Brothers Mason Contractors, Inc. to perform masonry for the construction of the library at the University of Connecticut School of Law. In 2008, the State sued Lombardo for faulty construction. From 1994 to 2008, several insurance carriers assumed Lombardo’s risk, including Travelers Casualty and Surety Company of America and Travelers Indemnity Company (together, Travelers) and The Netherlands Insurance Company (Netherlands). Netherlands refused to provide a defense, and Travelers spent more than $482,855 defending Lombardo. Travelers then filed a complaint against Netherlands and other insurers, seeking a judgment declaring that Netherlands was obligated to defend Lombardo and pay to Travelers its pro rata share of the costs incurred in defending Lombardo. The trial court granted judgment in favor of Travelers. Netherlands appealed, raising a number of appellate issues. The Supreme Court affirmed, holding that the trial court did not err in its judgment.View "Travelers Cas. & Surety Co. of Am. v. Netherlands Ins. Co." on Justia Law

The Medicare as a Secondary Payer Act, 42 U.S.C. 1395y(b)(2) precludes Medicare from providing benefits when a “primary plan” could be expected to pay. When the primary plan does not promptly pay medical expenses, Medicare makes conditional payments and is entitled to reimbursement. Under the New Jersey Collateral Source Statute (NJCSS), N.J. Stat. 2A:15–97, a tort plaintiff cannot recover damages from a defendant when she has already received funding from a different source. Taransky was injured when she fell at a shopping center. Medicare conditionally paid for her care. She sued the owner, seeking damages for bodily injury, disability, pain and suffering, emotional distress, economic loss, and medical expenses. She settled for $90,000, granting a full release, stating that liens or subrogation claims would be satisfied from settlement proceeds, and stating that Taransky would indemnify the owner with respect to such claims. Based on the NJCSS, Taransky then claimed that her Medicare expenses were not included in the settlement and obtained an order that the settlement was solely recovery for bodily injury, disability, pain and suffering, emotional distress, and non-economic, otherwise-uncompensated loss. A Medicare contractor demanded reimbursement of $10,121.15. Taransky refused to pay, arguing that a tortfeasor was not a “primary plan” and that reimbursement would be inequitable because she had not recovered medical expenses. An ALJ ruled against Taransky. The Medicare Appeals Council affirmed. The district court dismissed, holding that it lacked jurisdiction over proportionality and due process claims because she had not raised them before the agency; that the NJCSS did not apply to conditional Medicare benefits; and that the MSP Act authorized reimbursement from the settlement. The Third Circuit affirmed. View "Taransky v. Sec'y U.S. Dep't of Heath & Human Servs." on Justia Law

The Alaska Workers' Compensation Board denied a death benefit claim filed by the decedent's same-sex partner because the death benefit statute grants benefits only to a worker’s "widow or widower" as defined by statute. The Board construed these terms by applying the Marriage Amendment to the Alaska Constitution, which defined marriage as "only between one man and one woman," thus excluding a decedent's same-sex partner. Because this exclusion lacked a fair and substantial relationship to the purpose of the statute, the Supreme Court concluded that this restriction on the statutory definition of "widow" violated the surviving partner's right to equal protection under the law. View "Harris v. Millennium Hotel" on Justia Law

A credit union sued former members of the credit union’s board of directors. The former directors submitted the lawsuit to the credit union’s insurer, seeking coverage under the policy. The insurer denied coverage. The former directors sued, seeking a declaratory judgment that the policy covered the credit union’s claims. The district court ruled in favor of the former directors but later reconsidered and granted summary judgment to the insurer. The former directors settled with the credit union while reconsideration was pending. The Supreme Court affirmed the grant of summary judgment for the insurer, holding that the district court did not abuse its discretion in (1) vacating its earlier judgment granting the former directors’ motion for declaratory judgment, as the former directors did not establish that they were entitled to summary or declaratory judgment; and (2) allowing the insurer to amend its answer, as the settlement potentially gave rise to new policy-based defenses that were not barred by equitable estoppel.View "Breci v. St. Paul Mercury Ins. Co." on Justia Law

The Eastern Municipal Water District (EMWD) hired general contractor S.J. and Burkhardt, Inc. (SJB) for a public works construction project in 2006. Safeco Insurance Company (Safeco) executed performance and payment bonds for the project. Plaintiff Golden State Boring & Pipe Jacking, Inc. (GSB) was a subcontractor for the project, completing its work by September 2006, but it did not receive payment. In March 2008, SJB sent a voluntary default letter to Safeco. In July 2008, GSB sued SJB, EMWD, and Safeco for the unpaid amounts under the contract, separately seeking payment from Safeco under its payment bond. EMWD filed a cross-complaint to interplead retained sums. Safeco made a motion for summary judgment on the cause of action for payment under the bond on the ground that GSB’s claim was untimely. The trial court granted the motion, finding that there had been three cessations of labor that triggered GSB’s duty to file a stop notice in order to secure payment under Safeco's payment bond. At a subsequent court trial on the contract claims, GSB was awarded judgment against SJB, and Safeco was awarded judgment on the interpleader action. GSB appealed the summary judgment ruling, arguing: (1) the trial court erroneously overruled its objections to evidentiary matters presented in support of Safeco’s summary judgment; and (2) the court erred in finding the action was untimely. Finding no reversible error, the Court of Appeal affirmed. View "Golden State v. Eastern Municipal Water Dist." on Justia Law

Russell Adams sustained injuries while plowing snow for his employer, the Village of Fontana. Adams sued Northland Equipment Company, which had repaired the plow before the accident, and its insurer, pursuant to Wis. Stat. 102.29(1). The Village’s worker’s compensation insurer accepted Northland’s offer to settle Adams’ claim and moved the circuit court to compel Adams to accept the settlement as well. The circuit court granted the motion. Adams appealed, arguing that a worker’s compensation insurer cannot compel an employee to accept settlement of a third party tort claim. The Supreme Court affirmed, holding (1) a circuit court may compel an employee to accept settlement of the claim the legislature created in Wis. Stat. 102.29(1); and (2) the circuit court’s authority to compel an employee to accept settlement does not violate the employee’s right to a jury trial or procedural due process.View "Adams v. Northland Equip. Co., Inc." on Justia Law

This case arose from the liquidation proceedings of Reliance Insurance Company. One of Reliance's policyholders, Warrantech Consumer Products Services, Inc., submitted various proofs of claim seeking reimbursement under two insurance policies in which Reliance agreed to indemnify Warrantech for all future liabilities arising under certain warranty/service contracts Warrantech entered during the applicable policy period. The Commonwealth Court denied Warrantech's claims, holding that 40 P.S. 221.21 of the Insurance Department Act applied to terminate coverage for all "risks in effect" under a policy of insurance no later than thirty days after the respective insurer enters liquidation, notwithstanding that the relevant policies of insurance were cancelled prior to the date of liquidation. Finding no reversible error, the Supreme Court affirmed the Commonwealth Court's judgment. View "Warrantech v. Reliance Ins Co." on Justia Law