Mealey's Insurance Bad Faith : Mealey's : Legal News & Analysis

Mealey's Insurance Bad Faith

April 07, 2025
Multiple Claims Alleged By Insured In Faulty Work Coverage Suit Dismissed

NEWARK, N.J. — A New Jersey federal judge granted a professional liability insurer’s motion to dismiss an insured’s claims alleging breach of contract, bad faith, unjust enrichment and declaratory judgment after determining that the insured failed to identify a policy provision that was breached and failed to show that the insurer’s denial of coverage for an underlying suit related to the insured’s architectural work was unreasonable.
April 07, 2025
Judgment Denied In Breach Of Contract, Bad Faith Suit Over $70K Life Policy

ALBANY, Ga. — A Georgia federal judge granted in part and denied in part a motion for summary judgment filed by a life insurer in a breach of contract and bad faith suit against it by the beneficiary of a $70,000 life insurance policy, finding in part that a dispute of facts remains as to whether the decedent made misrepresentations in the policy application.
April 04, 2025
California Panel Reverses Judgment For Insurer In HOA’s Suit Over Water Damage

LOS ANGELES — Finding that there are issues of material fact regarding whether the water damage and faulty workmanship exclusions in a condominium homeowners association’s all risks policy preclude coverage for rain damage that occurred during a reroofing project, a California appellate panel reversed a lower court’s grant of summary judgment to the insurer on the association’s breach of contract and bad faith claims.
April 02, 2025
5th Circuit Says No Additional Coverage Owed For Insured’s Hurricane Damage Claims

NEW ORLEANS — An insurer properly adjusted an insured’s claims for hurricane damages based on the actual cash value of the damages to the insured’s properties and did not act in bad faith in handling the claims, the Fifth Circuit U.S. Court of Appeals said in affirming a series of rulings issued by a district court.
April 01, 2025
Suit Against Contractors Pollution Liability Insurer Will Remain In Federal Court

BATON ROUGE, La. — A Louisiana federal judge adopted a magistrate judge’s report and recommendation and denied an insured’s motion to remand a bad faith lawsuit filed against a contractors professional and pollution liability insurer, agreeing with the magistrate judge that the suit is not a direct action suit under federal law as required to avoid federal jurisdiction.
April 01, 2025
Judge Says Policies’ Limit Is Based On Per-Claim Calculation Of Lead Injury Claims

ST. LOUIS — A Missouri federal judge denied an insurer’s motion for summary judgment in a coverage dispute over underlying personal injury claims arising out of the insured’s lead-smelting operations, rejecting the insurer’s argument that the total limit of liability under its first two policies issued to the insured is $1.5 million and explaining that the total limit of liability under the first two policies is $21.5 million based on a policy endorsement that changed the limits of liability to $500,000 per claim.
April 01, 2025
Insurer, Reinsurer Seek To Oppose Reconsideration Of Cleanup Case Production Ruling

PADUCAH, Ky. — An insurer and reinsurer seek leave from a Kentucky federal magistrate judge to file an opposition to a ferrosilicon producer’s motion for reconsideration of a January ruling that denied the producer’s motion to compel production of documents from the insurers in a dispute over pollution-related cleanup costs; they argue in their reply in support of their motion for leave that the motion for reconsideration violates at least two prior orders and improperly raises new arguments.
April 01, 2025
Washington Panel: Tribe Fails To Show COVID-19 Caused Direct Physical Loss, Damage

SEATTLE — A Washington appeals court panel on March 31 held that a federally recognized Indian tribe did not state a claim that the coronavirus caused “direct physical loss or damage” to its insured properties, affirming a lower court’s dismissal of the insured’s bad faith complaint arising from the pandemic.
March 31, 2025
Grant Of Summary Judgment Recommeded On Contract Breach Claim In Disability Suit

BUFFALO, N.Y. — A New York federal magistrate judge on March 28 recommended that a disability claimant’s motion for summary judgment on a breach of contract claim be granted because the evidence shows that the claimant remained disabled; however, the magistrate judge recommended that the claimant’s motion be denied on a claim alleging breach of the covenant of good faith and fair dealing because questions of fact exist on whether the insurer’s termination of benefits was reasonable.
March 31, 2025
Panel Reverses Ruling Based On Insureds’ Failure To Serve Remedy Notice To Insurer

MIAMI — The Third District Florida Court of Appeals reversed a trial court’s denial of an auto insurer’s motion for summary judgment in a bad faith suit after determining that the trial court erred in finding that the suit could proceed even though the insurer was not served with a civil remedy notice within 60 days as required under Florida law and as required prior to the filing of a bad faith lawsuit.
March 31, 2025
Insured’s Failure To Cooperate Dooms Contract Breach, Bad Faith Claims, Judge Says

SAN DIEGO — An insured’s breach of contract and bad faith claims against a property insurer cannot proceed because the insurer did not breach the contract or act in bad faith based on the insured’s failure to cooperate with the insurer’s requests during the investigation of the insured’s fire damage claim, a California federal judge said in granting the insurer’s motion for summary judgment.
March 28, 2025
Third-Party Bad Faith Claim To Proceed Against Auto Insurer, Judge Says

TAMPA, Fla. — A third-party claimant’s bad faith claim against an auto insurer can proceed because a question of fact exists as to whether the auto insurer acted reasonably in handling multiple claims asserted against the insured after an auto accident, a Florida federal judge said in denying the insurer’s motion for summary judgment.
March 28, 2025
5th Circuit Affirms Ruling In Insurer’s Favor In Bad Faith Suit Over Storm Damage

NEW ORLEANS — The Fifth Circuit U.S. Court of Appeals affirmed a lower court’s judgment in favor of an insurer in a Texas insured’s bad faith lawsuit arising from a coverage dispute over wind and hail property damage, finding that the insured fully recovered its entitled-to insurance benefits and failed to present evidence that supports an independent injury caused by the insurer’s purported violations of the Texas Insurance Code.
March 27, 2025
Panel Says Breach Of Contract, Bad Faith Claims Against Property Insurer Fail

NEW ORLEANS — A Texas federal judge properly granted summary judgment on breach of contract and bad faith claims in favor of a property insurer because the insured failed to present any facts that would allow a fact finder to conclude that the losses were caused by a covered peril, the Fifth Circuit U.S. Court of Appeals said.
March 26, 2025
5th Circuit Affirms Ruling In Insurer’s Favor In Winter Storm Uri Coverage Dispute

NEW ORLEANS — The Fifth Circuit U.S. Court of Appeals concluded that because insureds have recovered their insurance policy benefits in full through the insurer’s payment of the appraisal award and statutory interest, they cannot recover bad faith damages in their lawsuit arising from damage caused by winter storm Uri.
March 25, 2025
Deal Report Garners Stay In Former Surgeon’s Suit For LTD Benefits

TYLER, Texas — Saying in a March 24 notice that they “are working on finalizing” an unspecified settlement, the parties in a former surgeon’s suit for long-term disability (LTD) benefits and relief for alleged mishandling of her claim successfully asked a Texas federal court to stay all deadlines in the case for 60 days.
March 24, 2025
Judge Overrules Objections, Denies Dismissal In Former Surgeon’s Disability Case

TYLER, Texas — Saying that a disability insurer’s objections “are without merit,” a Texas federal judge on March 21 overruled them and adopted a report and recommendation in a suit where a former surgeon seeks long-term disability (LTD) benefits and relief for alleged mishandling of her claim, thereby denying a dismissal motion.
March 24, 2025
Nevada Federal Judge Says Bad Faith Claims Fail To Allege Sufficient Facts

LAS VEGAS — A Nevada federal judge dismissed an insured’s bad faith claims against an auto insurer after determining that the insured failed to allege sufficient facts in support of the claims, however, the judge said the dismissal is without prejudice, allowing the insured to file an amended complaint to attempt to correct the deficiencies.
March 24, 2025
District Court Properly Found Employee’s Bad Faith Claim Cannot Proceed, Panel Says

CHICAGO — A district court properly granted a commercial liability insurer’s motion for judgment on the pleadings because the insurer was not vested with the discretion to investigate and settle the insured employee’s claim, the Seventh Circuit U.S. Court of Appeals said.
March 21, 2025
Auto Insurer’s Failure To Settle Was Not Unreasonable, Panel Majority Says

PASADENA, Calif. — The majority of the Ninth Circuit U.S. Court of Appeals on March 20 affirmed a district court’s summary judgment ruling in favor of an auto insurer after determining that the auto insurer did not act in bad faith in failing to settle a claim on behalf of its insured because the third-party claimant failed to turn over his medical records despite numerous requests from the auto insurer.
March 20, 2025
Insureds’ Failure To Provide Proof Of Loss Forms Relieves Insurer Of Coverage Duty

NEW YORK — A property insurer does not owe coverage to its insureds for a missing boat dock because the insureds’ failure to provide requested proof of loss forms within 60 days of receiving the request from the insurer constitutes a violation of the insurance policy’s terms and relieves the insurer of its duty to pay the insureds’ claim, the Second Circuit U.S. Court of Appeals said March 19 in affirming a district court’s ruling on the insureds’ breach of contract and bad faith claims.
March 20, 2025
Split Louisiana Panel Affirms Order To Pay $50,000 To Life Policy Beneficiary

GRETNA, La. — A split Louisiana appellate court panel on March 19 affirmed in part a lower court order requiring a life insurer to pay a policy beneficiary $50,000, the face value of a life insurance policy, finding that the lower court did not err in its determination that the insurer failed to show that the decedent “made material misrepresentations with an intent to deceive” in the policy application.
March 18, 2025
Insurer Seeks Take-Nothing Judgment After Jury Awards Insured $39.9M In Storm Suit

TYLER, Texas — A commercial property insurer moved for full judgment as a matter of law and alternatively a new trial after a jury in a Texas federal court unanimously awarded its insured $4,838,747 in damages for its breach of contract and $35 million in exemplary damages for its breach of the duty of good faith and fair dealing in a coverage dispute arising from property damage that was caused by an April 12, 2020, wind and hailstorm.
March 17, 2025
6th Circuit Asked To Rehear No Coverage Ruling In Professional Liability Dispute

CINCINNATI — An appellant filed a petition for panel rehearing and rehearing en banc asking the Sixth Circuit U.S. Court of Appeals to reconsider its finding that her declaratory judgment and bad faith claims fail because she did not provide a professional liability insurer with “all reasonably obtainable information” about her potential negligence claim against a dentist insured, arguing that the panel opinion misapplied insurance law, failed to hold the insurer accountable “for its shifting justifications” and created “an insurmountable burden for third parties attempting to report claims.”
March 17, 2025
Mississippi Federal Judge Dismisses Extracontractual Claims Against Auto Insurer

JACKSON, Miss. — An insured’s bad faith claims against an auto insurer cannot proceed because the auto insurer offered evidence that the only dispute at issue between the insured and the insurer was a dispute over the amount owed for the insured’s underinsured motorist (UIM) claim, a Mississippi federal judge said in granting the auto insurer’s unopposed motion for summary judgment.