Seeing the Finish Line: Courts Increasingly Exempt Claims-Made Policies from the Notice Prejudice Rule

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In a majority of jurisdictions, the "notice-prejudice rule" provides that an insurer may not deny a claim on grounds of late notice without demonstrating prejudice. The rule is statutory in some states and judicially crafted in others.  Most courts, however, also hold that the rule does not apply to late notice under a claims-made-and-reported policy, as opposed to an occurrence policy.  In 2015, several cases have solidified this trend, and some of them actually extend ... Keep Reading »

Not So Fast: New York’s High Court Relieves Pressure on Liability Carriers to Disclaim Coverage “As Soon As Possible”

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Under a New York statute, a liability insurer that denies coverage for a death or bodily injury claim must provide written notice of its decision “as soon as is reasonably possible.”  Last year, in Long Island Lighting Co. v. Allianz Underwriters Ins. Co., 961 N.Y.S.2d 419 (1st Dep’t 2013), an intermediate appellate court applied that standard to an insurer’s denial of coverage for environmental damage claims involving the site of a manufactured gas plant (MGP).  The ... Keep Reading »

In Late Notice Cases, There’s More at Stake than a Single Claim

Both property and liability policies contain provisions that require the insured to provide its carrier with timely notice of a claim, but cases in which late notice is used as a basis for denying coverage often leave the insurer in an unflattering light.  It is not always apparent that the late notice has made any actual difference to the insurer.  Consequently, even though most notice provisions are written as strictly as possible, making timely notice a condition ... Keep Reading »

Watching the Detectives: Washington Court Opens Door to Second-Guessing Insurers’ Investigations of Claims

In a case of first impression, the Supreme Court of Washington has ruled that an insurer’s express and unqualified contractual right to request an examination under oath is subject to an implied requirement that the request be “reasonable or material.”  The court further held that an insured’s refusal of even a reasonable request for an EUO will not excuse the insurer from paying a claim, absent a showing of actual prejudice.  The court’s ruling means insurers cannot ... Keep Reading »