Justia Insurance Law Opinion Summaries

Plaintiffs are three skiers who purchased an Ikon Pass for the 2019–20 ski season. Each pass provided purchasers with unlimited ski access at participating Ikon resorts in North America. Along with their Ikon Pass, Plaintiffs purchased an optional Ski Pass Preserver insurance policy from Arch. After Plaintiffs purchased their passes, state and local governments issued orders, colloquially called “stay-at-home orders,” to prevent the spread of COVID-19. In response to these orders, ski resorts throughout North America closed with approximately one-third of the ski season remaining. Plaintiffs sought reimbursement for the loss of their ski pass benefits under the policy based on the Season Pass Interruption coverage. Arch denied their claims. The company took the position that the stay-at-home orders were not quarantines under the policy, later posting a “blanket denial” for such claims on its website. Plaintiffs filed one master consolidated class action complaint on behalf of themselves and a nationwide putative class of individuals who purchased the Ski Pass Preserver policy for the 2019–20 ski season. The district court concluded that Plaintiffs did not plausibly allege a covered loss because the term “quarantined,” as used in the policy, did not encompass stay-at-home orders that merely limited travel and activities.   The Eighth Circuit affirmed. The court explained that the ordinary person at the time the Ski Pass Preserver policy was purchased would have understood “quarantined” to mean the compulsory isolation of the insured. Reading the policy as a whole, this is the only reasonable construction, and the court agreed with the district court that the policy language is unambiguous. View "Mark Rossi v. Arch Insurance Company" on Justia Law

This appeal from summary judgment in favor of Sequoia Insurance Company (Sequoia) was one of thousands of cases nationwide involving a claim for business interruption coverage arising out of the COVID-19 pandemic. The outcome here turned on whether there was evidence creating a triable issue that the insured, Best Rest Motel, Inc. (Best Rest), sustained lost business income “due to the necessary ‘suspension’ ” of its operations “caused by direct physical loss of or damage” to the insured property. Best Rest contended its case fell directly within the exception discussed by the Court of Appeal in Inns-by-the-Sea v. California Mut. Ins. Co., 71 Cal.App.5th 688 (2021). Though the Court found Inns might undermine, if not entirely foreclose Best Rest’s case, the Court limited its holding by positing in dicta a “hypothetical scenario” where “an invisible airborne agent would cause a policyholder to suspend operations because of direct physical damage to property.” Here, the Court determined Best Rest's argument failed because the record contained no evidence creating a triable issue that the hotel “could have otherwise been operating” but for the presence of COVID-19 on the premises. Best Rest’s own evidence established the exact opposite was true: its vice president and operating partner testified that the phones were “ringing off the hook[ ]” with cancellations—not because of COVID-19 in the hotel, but because of government shut down orders and travel restrictions that shuttered tourism. Accordingly, the Court affirmed summary judgment in the insurance company's favor because there was no evidence creating a triable issue that COVID-19 in the hotel caused the claimed lost income. View "Best Rest Motel, Inc. v. Sequoia Insurance Co." on Justia Law

In 2014, plaintiffs Roberta and Kevin Haas' stopped car was struck by a car driven by defendant Mark Carter. Plaintiffs brought this negligence action against defendants, Carter's estate and State Farm Mutual Automobile Insurance Company, seeking to recover economic and noneconomic damages. Carter died after plaintiffs filed suit. State Farm was Roberta Haas' insurer, whom she sued for breach of contract, alleging it failed to pay all the personal injury protection benefits that were due. At trial, one of the primary issues was whether Carter’s driving was a cause-in-fact of the injuries that plaintiffs alleged, and the issue on appeal became whether the trial court properly instructed the jury on causation. The jury returned a verdict for defendants. After review, the Oregon Supreme Court determined the trial court did not err in instructing the jury on causation, and affirmed the circuit court's judgment. View "Haas v. Estate of Mark Steven Carter" on Justia Law

After the decedent died, Plaintiff, his surviving spouse, filed suit seeking relief under a provision of the Employee Retirement Income Security Act allowing “a participant or beneficiary” of an employee benefit plan “to recover benefits due” “under the terms of [the] plan.” The parties submitted a joint stipulation of facts and an administrative record and cross-moved for judgment based on those undisputed materials. The district court entered judgment for Prudential. The court concluded Prudential “reasonably denied Plaintiff’s request for benefits” because “decedent received timely notice of his conversion rights” and “did not convert his life insurance to an individual policy during the conversion period.” The district court also rejected Plaintiff’s request to “apply the doctrine of equitable tolling and find that Plaintiff is entitled to the life insurance benefits she seeks.”   The Fourth Circuit affirmed. The court wrote that it agreed with the district court that the plan administrator did not abuse its discretion in concluding Plaintiff was not entitled to benefits under the terms of the plan. The court explained that “Employers have large leeway to design [employee benefit] plans as they see fit,” but “once a plan is established, the administrator’s duty is to see that the plan is maintained pursuant to that written instrument.” Here, Prudential did not abuse its discretion by fulfilling its duty here, and the district court correctly resolved the single claim before it based on the agreed-on facts and consistent with well-established law. View "Kathy Hayes v. Prudential Insurance Company of America" on Justia Law

Plaintiff sued Minnesota Life Insurance Company and Securian Life Insurance Company, alleging that their denial of her claim for life insurance benefits violated the Employee Retirement Income Security Act (“ERISA”). The district court dismissed her complaint under the Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim.   The Eighth Circuit affirmed. The court concluded that the district court properly dismissed Plaintiff’s Section 1132(a)(3) claim. First, her contention that Minnesota Life and Securian failed to notify her husband of his conversion right does not amount to a breach of fiduciary duty because the terms of her husband’s policy did not require notice, and Plaintiff points to no provision of ERISA that would require such notice. Second, her assertion that Minnesota Life and Securian misrepresented that her husband’s conversion window would be extended rests on a misreading of the February 24 letter; Minnesota Life and Securian made no such representation. View "Kristina Powell v. Minnesota Life Insurance Co." on Justia Law

After her husband died of a heroin overdose, Plaintiff sought accidental death benefits under an employer-sponsored benefit plan governed by the Employee Retirement Income Security Act of 1974 (ERISA). The plan’s insurer, Symetra Life Insurance Company, denied her claim, and Plaintiff sued. The district court granted summary judgment in Plaintiff’s favor. Symetra appealed, arguing that Plaintiff’s suit is barred by her failure to exhaust internal review procedures and that her husband’s death otherwise falls under an exclusion to coverage.   The Eighth Circuit affirmed. Symetra contends that the exclusion applies to Plaintiff’s husband’s death because he “purposely” used heroin. But just because the act of using an illegal substance is purposeful does not mean that an injury stemming from that act, including a fatal overdose, was too. Symetra also maintains that Plaintiff’s husband, as a “longtime drug user,” was surely aware of the risks of using heroin and that his “generalized knowledge” of such risks is sufficient for his death to fall under the “intentionally self-inflicted injury” exclusion. The court reasoned that even assuming Symetra’s characterization of Plaintiff’s husband’s drug use is accurate, the argument attempts to replace an exclusion that applies only to “intentionally self-inflicted” injuries with one that also includes injuries resulting from reckless, or even negligent, conduct. The court wrote that the plain language of Symetra’s “intentionally self-inflicted injury” exclusion does not apply to unintended injuries like Plaintiff’s husband’s heroin overdose. Thus, Symetra’s denial of Plaintiff’s claim for accidental death benefits based on that exclusion was erroneous. View "Terri Yates v. Symetra Life Insurance Company" on Justia Law

The assignees of two Medicare Advantage Organizations seek reimbursements from insurance companies that they allege qualify as primary payers of beneficiaries’ medical expenses. The insurance companies argued, and the district courts agreed, that the assignees’ claims are barred because both assignees failed to satisfy a procedural requirement: a contractual claims-filing deadline in one case and a statutory requirement of a pre-suit demand in the other. The assignees contend that the procedural requirements are preempted by the Medicare Secondary Payer Act.   The Eleventh Circuit affirmed. The court reasoned that Florida’s pre-suit demand requirement does not meet this relatively high bar. The statutory notice requirement and corresponding 30-day cure period are procedural requirements that may result in a brief delay. But the Florida law does not prevent or meaningfully impede the reimbursement of Medicare Advantage Organizations that Congress sought to facilitate. So, the provision does not create an unconstitutional obstacle to the purposes or operation of the Medicare Secondary Payer Act. View "MSP Recovery Claims, Series LLC v. United Automobile Insurance Company" on Justia Law

Plaintiff appealed the district court’s order affirming the Social Security Administration’s (“SSA”) denial of her application for Social Security Disability Insurance (“SSDI”). In her application, she alleged major depressive disorder (“MDD”), anxiety disorder, and attention deficit disorder (“ADHD”). Following a formal hearing, the Administrative Law Judge (“ALJ”) determined that Plaintiff suffered from severe depression with suicidal ideations, anxiety features and ADHD, but he nonetheless denied her claim based on his finding that she could perform other simple, routine jobs and was, therefore, not disabled. Plaintiff contends that the ALJ erred by (1) according to only little weight to the opinion of her long-time treating psychiatrist (“Dr. B”) and (2) disregarding her subjective complaints based on their alleged inconsistency with the objective medical evidence in the record.   The Fourth Circuit reversed and remanded with instructions to grant disability benefits. The court agreed with Plaintiff that the ALJ failed to sufficiently consider the requisite factors and record evidence by extending little weight to Dr. B’s opinion. The ALJ also erred by improperly disregarding Plaintiff’s subjective statements. Finally, the court found that the ALJ’s analysis did not account for the unique nature of the relevant mental health impairments, specifically chronic depression. The court explained that because substantial evidence in the record clearly establishes Plaintiff’s disability, remanding for a rehearing would only “delay justice.” View "Shelley C. v. Commissioner of Social Security Administration" on Justia Law

The Supreme Court vacated the opinion of the intermediate court of appeals (ICA) reversing the order of the circuit court granting summary judgment in favor of Defendant in this insurance broker malpractice case, holding that the circuit court and the ICA majority incorrectly analyzed Defendant's burden regarding the causation element.Plaintiff brought negligence and negligent malpractice claims against Defendant. In the original proceedings, judgment was granted for Plaintiff. The ICA remanded the case to the circuit court to include previously excluded testimony. On remand, the circuit court granted summary judgment for Defendant. The ICA reversed. The Supreme Court vacated the ICA"s order and remanded the case to the circuit court for further proceedings, holding (1) to negate the causation element of the negligence and negligent malpractice claims against it Defendant would need to demonstrate that Plaintiff's insurer (Insurer) would not have been legally obligated to advance Plaintiff's defense costs even if Plaintiff's grand jury subpoena matter were timely tendered to Insurer; and (2) the lower courts incorrectly analyzed Defendant's burden regarding the causation element, requiring remand. View "Pflueger, Inc. v. AIU Holdings, Inc." on Justia Law

The Supreme Court affirmed the judgment of the trial court in favor of Plaintiffs in this action for a declaratory judgment to determine whether Plaintiffs were obligated to defend and indemnify Defendant under insurance policies for damages awarded against Defendant in a separate action, holding that Defendant was not entitled to relief on his allegations of error.At issue was whether Plaintiffs, insurers, were obligated to indemnify Defendant, a business owner, under an insurance policy for liability arising from Defendant's false imprisonment of his company's employment at her workplace. The trial court concluded that Plaintiffs had a duty to indemnify Defendant, but the appellate court reversed. The Supreme Court reversed and remanded the case. After a trial de novo, the trial court concluded that coverage was barred by the policy's "business pursuits" exclusion. The Supreme Court affirmed, holding (1) the trial court properly applied the preponderance of the evidence standard at the trial de novo; and (2) Defendant's remaining claims were without merit. View "Nationwide Mutual Insurance Co. v. Pasiak" on Justia Law