Andy crawled to freedom through five hundred yards of - - - smelling foulness I can't even imagine. Or maybe I just don't want to. Five hundred yards. The length of five football fields. Just shy of half a mile. –The Shawshank Redemption (1994) Many homeowners and other property insurance policies contain an exclusion to address one of the by-products of the increased frequency of severe weather: it bars coverage for property damage caused by "water which backs up ... Keep Reading »
Homeowners
If Rainwater Lands Where it Doesn’t Belong, It’s Still “Surface Water” in the Eleventh Circuit
The Eleventh Circuit recently affirmed a decision of the Southern District of Georgia, finding an insured’s claim for water damage fell within an exclusion for loss or damage caused by "surface water." In Williams v. State Farm Fire and Casualty Insurance Company, Case No. 14-11100 (11th Cir. July 17, 2014), the dispute arose after the insured’s home was damaged by "thigh deep" water runoff from a rainstorm. The water should have flowed away from the plaintiff’s home, ... Keep Reading »
SCOTUS: Would-Be Class Representative Cannot Avoid CAFA Jurisdiction by Stipulating to Limit Damages
Some class action plaintiffs who want to keep their cases in state court execute “stipulations” not to seek more than $5 million in aggregated damages on behalf of the class. When the case is removed, they argue that the defendant cannot establish that “the matter in controversy exceeds the sum or value of $5,000,000”—the threshold for federal jurisdiction under the Class Action Fairness Act. In a curt, unanimous opinion authored by Justice Breyer, the Supreme Court of ... Keep Reading »
Federal Court Refuses to Let Insured Shoot First, Seek Coverage Later
at Sandy Hook Elementary School, the issue has been taken up passionately by both sides of the dispute over gun violence. Did the murderers in Newtown and Aurora kill in large numbers because they were able to fire many shots quickly, and without reloading, as Sen. Lautenberg believes? Or, as a Wall Street Journal editorial recently suggested, can the proliferation of mass killings be more reasonably attributed to the practice of designating “gun-free zones” in ... 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 »
Casting a Wide Net: Challenges to Lender-Placed Flood Insurance Erode Distinctions Between Banks and Insurers
As banks play an increasing role in the marketing and sale of property-casualty insurance products, the businesses of banking and insurance are becoming entangled. One place where they intersect is the purchase of lender-placed insurance protecting against floods and other hazards. Uniform mortgage agreements typically give banks a right to “require” their borrowers to maintain certain types of insurance on mortgaged property, and to separately purchase that insurance ... Keep Reading »
What’s in a Proper Name? Coverage Opinions Take Different Approaches
In his 1892 paper, “On Sense and Reference,” Gottlob Frege, the German philosopher who inspired the work of Bertrand Russell, explained that the definition of a word or name can have two components. One, “reference” (or “referent”), is simply the person or object to which the word refers. The “reference” of “Napoleon Bonaparte” is the French emperor who bore that name. The second element, “sense,” is the name’s “mode of presentation,” which reflects the manner in ... Keep Reading »
Giving Short Rate: Farmers Potentially Liable for Unused Premium
Certain homeowners policies issued to California insureds by Farmers Group, Inc., contained the following cancellation terms: “(1) If you cancel this policy, we shall return the short rate unused share of the premium. (2) If we cancel this policy, we shall return the prorated unused share of the premium.” While indicating in this way that cancelling homeowners would receive something other than a “prorated” share, the policies did not state what the “short rate” share ... Keep Reading »
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