The Eleventh Circuit Court of Appeals, in M&M Sisters LLC v. Scottsdale Insurance Co., affirmed the district court’s dismissal of an insured’s third amended complaint against its insurance carrier for failure to state a claim for relief without further leave to amend. The plaintiffs, M&M Sisters LLC and its two owners Bertha Garcia and Maria Mendez, purchased a commercial general liability policy from the defendant, Scottsdale Insurance Co., covering an ... Keep Reading »
Sixth Circuit Holds Attorneys’ Fee Award Does Not Constitute Damages Under Professional Liability Policy
The Sixth Circuit Court of Appeals affirmed an order granting summary judgment in favor of the insurer in Wesco Insurance Co. v. Roderick Linton Belfance LLP, holding that the award of attorneys’ fees was a “sanction” and thus was not covered damages under the Wesco professional liability policy. This matter concerned an award of attorneys’ fees stemming from claims that were brought against schools under the Individuals with Disabilities Education Act (IDEA). The ... Keep Reading »
Fifth Circuit Determines a Deductible Buyback Policy Was a Named Perils Policy for Hurricane Harvey Flood Damage
The Fifth Circuit Court of Appeals recently reversed a federal Texas court’s order granting summary judgment in favor of the insured, holding that its “deductible buyback policy” was a “named perils” policy that did not provide coverage in relation to the insured’s flood-related damage sustained by a commercial building during Hurricane Harvey. The insured’s primary “all-risks” policy, which provided insurance for several of the insured’s properties, had a high ... Keep Reading »
Florida Federal Court Affirms Insurer’s Denial of Hurricane Irma Claim Reported More Than Two Years Late
The U.S. District Court for the Southern District of Florida granted a motion for summary judgment in favor of the insurer in LMP Holdings v Scottsdale Insurance Co., holding that the insurer was prejudiced by the insured’s delayed reporting of the claim. The matter concerned a Hurricane Irma claim for a commercial property located in Miami-Dade County, Florida. The insurer, Scottsdale Insurance Co., issued LMP Holdings Inc., the insured, an all-risk commercial ... Keep Reading »
South Carolina Supreme Court Authorizes Homeowner’s Insurers to Estimate Depreciation of “Embedded Labor Components” in Calculation of Actual Cash Value
The South Carolina Supreme Court, in the matter of Butler v. Travelers Home & Marine Insurance Co., held that when an insurer is determining actual cash value (ACV) under a homeowners insurance policy, the insurer can depreciate the cost of labor that includes both materials and embedded labor components. The case concerns two separate matters that were filed in a single action in federal district court involving fire damage to the homes of plaintiffs Miriam ... Keep Reading »
Beware the Honest Hacker: Indiana Supreme Court Finds That Bitcoin Payment Is Not Necessarily Covered Loss Under Commercial Crime Policy Because Not Every Ransomware Attack Involves Fraud
In G&G Oil Company of Indiana Inc. v. Continental Western Insurance Co., the Indiana Supreme Court considered the emerging area of computer crime coverage. G&G Oil was insured under a multi-peril commercial common insurance policy by Continental that provided commercial crime coverage. Specifically, the policy provided the following coverage provision: We will pay for loss or damage to "money," "securities" and "other property" resulting directly from the use ... Keep Reading »
Texas Federal Court Finds No Coverage for Civil Authority Orders Issued in Preparation for Hurricane Harvey Because They Were Not Issued as a Result of Physical Loss or Property Damage
The United States District Court for the Southern District of Texas, in the matter of Evanston Ins. Co. v. AmSpec Holding Corp., granted summary judgment in favor of Evanston Insurance Company (“Evanston”) after determining no coverage was available under a property insurance policy for Civil Authority Orders issued by the Coast Guard. No. 4:19-CV-1498, 2020 WL 6152190 (S.D. Tex. Oct. 20, 2020). AmSpec Holding Corporation (“AmSpec”) performs testing and inspection ... Keep Reading »
Minnesota Supreme Court’s First Opinion on the State’s Bad Faith Statute
The Minnesota Supreme Court in the matter of Alison Joel Peterson v. Western National Mutual Insurance Company, 946 N.W.2d 903 (Minn. 2020) opined for the first time on the state’s bad faith statute (Minn. Stat. § 604.18) and weighed in on the interpretation of the two prongs contained within the statute. The statute provides the following two prongs that must be determined for a court to award bad faith damages to an insured against the insurer: the absence of a ... Keep Reading »
Federal Puerto Rico Court Affirms That Coverage Under Claims-Made Policy Is Not Created by Waiver or Estoppel
The U.S. District Court for the District of Puerto Rico recently granted summary judgment in favor of Liberty International Underwriters after determining that coverage was not created by waiver or estoppel for a claim first made six months before the policy period of a claims-made policy. In Galarza-Cruz v. Grupo Hima San Pablo Inc., the plaintiff sued multiple defendants, including the insured and Liberty, in connection with various claims under Title VII and multiple ... Keep Reading »
Eleventh Circuit Weighs in on Allocated Verdict Form Procedure
The Eleventh Circuit, in the matter of QBE Specialty Insurance Co. v. Scrap Inc., affirmed the district court’s decision to grant summary judgment in favor of QBE holding that there was no indemnity coverage for an underlying judgment where a non-allocated verdict form was used because the insured could not meet its burden of allocating between coverage and uncovered damages. Background QBE Specialty Insurance Co. issued a general commercial liability (GCL) ... Keep Reading »