Specialty Lines
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June 28, 2024
In Chevron Case, Justices Trade One Unknown For Another
The U.S. Supreme Court's decision to overrule a decades-old judicial deference doctrine may cause the "eternal fog of uncertainty" surrounding federal agency actions to dissipate and level the playing field in challenges of government policies, but lawyers warn it raises new questions over what rules courts must follow and how judges will implement them.
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June 28, 2024
Insurer Says Auto Co.'s COVID Coverage Suit Is Time-Barred
An auto parts manufacturer's lawsuit seeking $50 million in coverage for COVID-19-related losses is time-barred, an insurer told a North Carolina federal court Friday, arguing that the manufacturer filed suit a year after the policy's three-year limitation period.
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June 28, 2024
Insurer Says Kennel Expansion Complaints Not Covered
A Hanover unit told a California federal court that it has no obligation to defend a dog kennel in an underlying lawsuit alleging that the kennel's expansion, which increased capacity from about 20 dogs to 200 dogs, interfered with the community's rights of possession.
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June 27, 2024
Proposed Calif. Insurance Tradeoff Draws Mixed Reactions
Insurance industry representatives and consumer advocates in California are pitching opposing visions for a proposed regulatory tradeoff at the heart of state officials’ efforts to increase homeowners insurance availability at a time of heightening wildfire risks.
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June 27, 2024
Auto Software Outage Turns Policyholders To Cyber Coverage
A ransomware attack against auto software company CDK Global that caused an ongoing disruption in the operations of car dealerships has sent policyholder experts pointing to cyber insurance policies for immediate relief.
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June 27, 2024
11th Circ. Upholds Radiology Practice's FMLA Suit Win
The Eleventh Circuit on Thursday backed a Florida radiology practice's defeat of a doctor's lawsuit alleging he was fired because he requested medical leave, ruling a lower court didn't err when it blocked him from presenting evidence he hadn't previously disclosed.
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June 27, 2024
Insurance Litigation Week In Review
The D.C. Circuit ordered coverage for water damage stemming from an excluded peril, a Nevada state court let a COVID-19 coverage suit remain despite a pro-insurer pandemic ruling from the state's justices, Travelers avoided defending asbestos suits and Nautilus Insurance prevailed in a $3 million logging injury coverage row.
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June 27, 2024
2024 'Super Election Year' Shows Value In Risk Management
Insurance experts are warning of potentially heightened risks as the 2024 presidential race ramps up in the U.S. and elections take place abroad, advising policyholders and insurers to maintain a strong understanding of their policies ahead of potential political unrest.
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June 27, 2024
AG Says Trump Recusal Bid Relies On 'Distortion Of Facts'
New York's attorney general says Donald Trump is relying on a "distortion of facts" in seeking to oust the judge who ordered the former president to pay $465 million in penalties in his civil fraud case.
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June 27, 2024
Insurer Climate Risk Report Drawing Regulatory Attention
A recent report finding that insurers are making mixed progress on climate risk disclosures will draw regulators' attention as they continue to shape how carriers detail information about their emissions and climate policies, experts say.
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June 27, 2024
Paper Co. Settles Employee Theft Suit Coverage After Trial
Following a settlement, a paper manufacturer agreed to end its Tennessee federal suit against its insurer over coverage for an employee theft scheme that the paper company said caused $31 million in losses.
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June 26, 2024
Conn. Insurance Chief Can Limit Struggling Insurer's Payouts
A Connecticut state court imposed a temporary moratorium on certain benefits that a private equity-owned life insurer can pay out to policyholders until a rehabilitation plan can be confirmed for the failing carrier, granting the state insurance department's petition for a rehabilitation order.
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June 25, 2024
Wash. Contractor, Insurer Resolve Redress Cost Dispute
A Washington federal court tossed a dispute between a mechanical contractor and its insurer over coverage for about $355,500 in "redress expenses" the contractor claims it incurred while working on a surgical center remodeling project to prevent future claims lodged against it.
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June 20, 2024
'AI Washing' Actions Mark New Frontier In Coverage Disputes
Recent regulatory actions and shareholder suits over alleged misrepresentations of artificial intelligence use, or what is known as AI washing, may be the first wave of a surge of claims that will hit professional and management liability insurance lines.
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June 20, 2024
Attys See Huge Financial, Legal Stakes In Hawaii Climate Suit
A novel Hawaiian case over whether an AIG insurer needs to pay a Sunoco subsidiary’s legal fees to beat claims it contributed to climate change has huge stakes for carriers and policyholders as they increasingly tussle over the cost of Earth-warming emissions.
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June 20, 2024
Trump Calls For Engoron's Recusal In Civil Fraud Case
Former President Donald Trump and other defendants fighting a $465 million civil fraud judgment called on New York Supreme Court Justice Arthur Engoron to recuse himself Thursday in light of a once-suspended real estate attorney's recent judicial misconduct claims, which have since sparked a judicial investigation.
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June 20, 2024
Calif. Justices Give Insureds Certainty On Policy Exhaustion
The California Supreme Court's clarification that an insured can look to first-layer excess policies as soon as primary coverage for that period is exhausted has favorable implications for policyholders, experts say, yet questions remain as a lower court weighs whether excess insurers must contribute to a primary insurer's coverage.
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June 20, 2024
Insurance Litigation Week In Review
The California Supreme Court opened the door to excess coverage for a policyholder's asbestos injury suits, the Hawaii Supreme Court questioned whether reckless behavior could trigger a Sunoco subsidiary's liability coverage, and the Second Circuit affirmed a Liberty Mutual unit's coverage win in a family shareholder dispute. Here, Law360 takes a look at the past week's top insurance news.
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June 20, 2024
Novel Vermont Polluter Law Raises Insurance Liability Issues
A new Vermont law requiring fossil fuel companies to fund projects ameliorating the negative effects of climate change could raise questions about what constitutes a covered occurrence and how pollution exclusions may apply, while also igniting choice-of-law disputes, experts say.
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June 20, 2024
Nationwide Wins Mich. Combined Filing Tax Fight On Appeal
Nationwide entities can file as a unitary business in Michigan to share tax credits across their group members, the state Court of Appeals ruled Thursday, overturning a state tax tribunal decision that said insurance companies were required to file separate returns.
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June 18, 2024
'Reckless' Behavior Centered In Climate Coverage Suit Args
Attorneys for a Sunoco subsidiary and AIG offered sharply differing views to Hawaii's top court Tuesday in oral arguments over whether reckless behavior would trigger the oil company's liability coverage in a novel suit over coverage for underlying climate change claims.
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June 18, 2024
Insurer Countersues In Penile Implant Coverage Dispute
An insurer has no duty to defend or indemnify a urologist, his medical device company or his practice in a proposed class action over a penile enlargement implant and procedure, the company told a California federal court, saying the underlying suit doesn't seek bodily injury damages that would trigger coverage.
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June 17, 2024
No Coverage For Family Shareholder Row, 2nd Circ. Affirms
A Liberty Mutual unit had no duty to defend Paraco Gas Corp. and two of its executives in a family shareholder dispute, the Second Circuit affirmed Monday, finding that all claims in the underlying suit fell within the policy's contract exclusion.
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June 14, 2024
11th Circ. Shows Insurers Preference In D&O Coverage Row
The Eleventh Circuit appeared poised to affirm a Florida district court's finding that the successor of an insurance services firm is not owed coverage for underlying shareholder-related litigation under 2017 claims-made policies because the claims are connected to ones made under a 2016 policy.
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June 14, 2024
Insurer Seeks Quick Exit In Casino $130M COVID Loss Suit
The insurer of a casino operator with properties on the Las Vegas strip and beyond told a Nevada federal judge to toss a $130 million COVID-19 pandemic loss coverage suit, arguing it had already paid $1 million — the only benefits due under the all-risk policy.
Expert Analysis
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Del. Related Claims Ruling Is Good News For Insurers
The Delaware Supreme Court recently denied coverage for a shareholder class action in First Solar v. National Union First Insurance, rejecting the test for assessing relatedness-based coverage issues, and opening the door for insurers to rely on specific policy wording when evaluating related claims, say attorneys at Troutman Pepper.
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How Sonic Boom Risk Informs 'Physical Loss' For COVID Era
Applied to today's COVID-19 business interruption insurance battles, insurers' historical treatment of damage associated with sonic booms — or explosive sounds stemming from supersonic airplane speeds — may call into question the many court rulings barring coverage for pandemic-related losses on narrow physical loss grounds, say Peter Kochenburger at the University of Connecticut and Jeffrey Stempel at University of Nevada, Las Vegas.
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Justices Must Apply Law Evenly In Shadow Docket Rulings
In recent shadow docket decisions, the U.S. Supreme Court has inconsistently applied the requirement that parties demonstrate irreparable harm to obtain injunctive relief, which is problematic for two separate but related reasons, says David Hopkins at Benesch.
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Preparing For New Mandatory Cyber Reporting Rules
The requirements of a new federal law mandating cyber incident reporting for critical infrastructure will not become operational for several months, but affected companies should begin assessing whether their response plans incorporate critical policies and procedures to ensure compliance, say Steven Stransky at Thompson Hine and Lacy Rex at Oswald Companies.
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What Cos. Can Glean From Early Cyber Policy Cases
Insurance claims for cyberattacks under cyber-specific policies have thus far been less contested than claims brought under commercial, crime and professional liability policies, however that may be changing, as cyber losses and liabilities continue to escalate and the market hardens, says Daniel Healy at Anderson Kill.
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A Guide To Extrinsic Evidence In Determining Duty To Defend
As the eight-corners rule for the duty to defend is increasingly riddled with exceptions to its strict formulation of confining the analysis to only the language of the insurance policy and the underlying complaint, Richard Mason at MasonADR discusses the newest notable decisions and offers strategies for attorneys litigating the duty to defend.
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What Insureds Should Look For In Excess Policies
A recent California appellate court decision, Truck Insurance Exchange v. Kaiser Cement, demonstrates how courts will protect policyholder expectations against primary insurance carriers' actions that might restrict available excess coverage, and highlights how insureds should be diligent in reviewing excess policies on primary erosion, say Courtney Horrigan and Elizabeth Taylor at Reed Smith.
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Political Risk Insurance May Help Cos. Hurt By Russian War
As Russia’s war on Ukraine causes severe economic fallout, it’s crucial that U.S. companies with operations in the region understand what losses might be covered by their political risk insurance policies, and take steps to ensure that all available coverage is preserved and maximized, says Micah Skidmore at Haynes and Boone.
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Recent Rulings May Support False Claims Act Coverage
Following a banner year for U.S. Department of Justice recoveries in False Claims Act cases and with FCA investigations likely to grow, companies and executives facing FCA exposures may find support in recent policyholder-friendly decisions for both their underlying defense and related insurance claims, says Geoffrey Fehling at Hunton.
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Anticipating Cyberinsurance Wartime Exclusion Questions
Amid threats that Russia and Moscow-sponsored groups may increase malicious cyberattacks, businesses can mitigate risk by analyzing how war and hostilities exclusions apply to their insurance policies and maintaining a comprehensive record of government cyberattack warnings, say Steven Stransky at Thompson Hine, David Finz at Alliant and Rick Yocum at TrustedSec.
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Check Your Policy Fine Print For Cyberwarfare Coverage
Given increasing risks of cyberwarfare following Russia's invasion of Ukraine, and with a recent policyholder-friendly ruling in Merck v. ACE from a New Jersey state court, those insured should take notice of certain insurers' expansive changes to war exclusions to broadly include cyberattacks, say Philip He and Colin Kemp at Pillsbury.
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How To Negotiate Better D&O Coverage For Antitrust Matters
In light of the Federal Trade Commission's recent indication that it will ramp up antitrust enforcement, Geoffrey Fehling and Christopher Dufek at Hunton discuss several issues corporate policyholders should review when placing and renewing directors and officers insurance coverage.
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New 'Bad Faith' Claim Law Holds NJ Insurers Accountable
New Jersey’s recently enacted Insurance Fair Conduct Act, giving policyholders a bad faith cause of action for claims involving uninsured and underinsured motorist coverage, is an important step toward countering unfair insurer advantage and expanding consumer protections, say attorneys at K&L Gates.