PropertyCasualtyFocus

Arizona Federal Court Finds False Pretenses Exclusion Bars Coverage for Fraudulent Wire Transfer Under Professional Liability Policy

by Amanda Proctor

In Helms v. Hanover Insurance Group Inc., the U.S. District Court for the District of Arizona weighed in on the issue whether a professional liability policy provided insurance for a fraudulent wire transfer. This decision is not the first to tackle this issue, and like the other opinions issued across the country, Helms demonstrates that the answer to this somewhat thorny question depends heavily on the specific policy wording at issue. The insured plaintiffs, a ... Keep Reading »

Consent to Settle: Third Circuit Reminds Insureds to Obtain Prior Written Consent Required by a Claims-Made Policy or Face Claim Denial, and Rejects Bad Faith Claim in Absence of a Finding of Coverage Under New Jersey Law

by Charles W. Stotter

In a non-precedential decision, the Third Circuit Court of Appeals upheld a district court’s grant of summary judgment to an errors and omissions insurer that declined to indemnify a settlement because the insured had settled the underlying lawsuit without obtaining the insurer’s prior written consent, “an express condition of coverage under the policy’s consent clause.” Interestingly, the court noted that the E&O insurer had paid the insured’s “defense costs to the ... Keep Reading »

Eleventh Circuit Finds No Insurance Coverage for Dental Practice’s COVID-19 Business Income Loss Under Georgia Law

by Gregory Gidus

In a recent decision, the Eleventh Circuit Court of Appeals ruled that an insured's failure to allege "direct physical loss or damage" to property was fatal to its COVID-19-related business interruption claim. Although addressed ad nauseam by the district courts - with the overwhelming majority finding no coverage - the Eleventh Circuit's unpublished decision appears to be just the second federal appellate opinion on this issue. The other, the Eighth Circuit's decision ... Keep Reading »

Sixth Circuit Determines the Term “Suspension of Operations” in Business Interruption Policy Requires “Complete Shutdown of Business Operations” Under Ohio Law

by Christina Gallo

Hastings Mutual Insurance Co. v. Mengel Dairy Farms LLC arose out of a dispute over coverage between two commercial dairy farmers who manage and care for more than 1,000 cows across farms in Pennsylvania and Ohio, and their business interruption insurer, Hastings Mutual Insurance Co., which insured the farmers' cows against a number of unlikely events - including accidental shooting, attack by wild animals, and - most relevant here - electrocution. In 2018, the ... Keep Reading »

Delaware Court Finds Appraisal Proceeding Is Not a Claim “for a Wrongful Act” and Dismisses $177M Coverage Action

by Alex B. Silverman

The Superior Court of Delaware rebuffed efforts by a policyholder to recover defense costs and interest it incurred in connection with an underlying appraisal proceeding, agreeing with the defendant-insurers that the proceeding did not seek redress “for a wrongful act.” The Appraisal Action Jarden LLC f/k/a Jarden Corp. was a holding company for a number of well-known consumer brands. In December 2015, Jarden agreed to merge with Newell Rubbermaid Inc. for cash ... Keep Reading »

Delaware Superior Court Finds Securities Class Action and Its Opt Outs’ Subsequent Class Action Are “Related Claims”

by Alex M. Bein

In First Solar Inc. v. National Union Fire Insurance Company of Pittsburgh, the Delaware Superior Court held there was no coverage for a class action brought by the individuals who opted out of a prior class action that had been filed before the subject policies’ inception where both actions involved fundamentally identical allegations of wrongdoing. First Solar sought coverage for a class action lawsuit filed on June 23, 2015 (Maverick action) under primary and ... Keep Reading »

Florida Appellate Court Issues Opinion on Validity of Assignment of Benefits in Property Insurance Claim

by Carlton Fields

As the Florida Legislature and Florida courts continue to grapple with the issue of assignments of benefits in property claims, the Fourth District Court of Appeal recently weighed in on a matter involving the validity of a purported assignment in QBE Specialty Insurance Co. v. United Reconstruction Group Inc. The case involved a water damage claim at a home insured by QBE Specialty Insurance Co. United Reconstruction Group was hired to perform emergency water ... Keep Reading »

Illinois Supreme Court Finds That Alleged Sharing of Fingerprint Data Violates the Right of Privacy, a “Personal Injury” Triggering Duty to Defend

by Novera H. Ahmad

The Illinois Supreme Court recently affirmed that West Bend Mutual Insurance Co. has a duty to defend an insured under a business insurance policy against allegations that they violated the Illinois Biometric Information Privacy Act (BIPA), finding that an exclusion that bars coverage for certain statutory actions did not apply. The court ruled that a tanning salon’s sharing of its clients’ biometric identifiers and biometric information (fingerprints) with a third-party ... Keep Reading »

South Carolina Supreme Court Authorizes Homeowner’s Insurers to Estimate Depreciation of “Embedded Labor Components” in Calculation of Actual Cash Value

by J. Kent Crocker

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 »

Florida Supreme Court Permits Insurer to Maintain Subrogated Malpractice Claim Against Counsel Retained to Represent Its Insured

by Gregory Gidus

Long-standing Florida law recognized only two limited exceptions to the general rule prohibiting a third party from pursuing a legal malpractice claim against an attorney who was not in privity with the third party - a will drafting situation and a private placement memoranda situation. In Arch Insurance Co. v. Kubicki Draper, LLP, the Florida Supreme Court created a third exception, now allowing an insurer with a duty to defend to stand in the shoes of its insured and ... Keep Reading »