Pet Insurance Bill Provides Important Consumer Protection For Rapidly Growing Market

Pet insurance industry to reach $750 million by 2015 as Americans increase spending on veterinary care. Within California's economy, the pet insurance market is rapidly growing and expected to reach $750 million by next year. AB 2056 (Matt Dababneh), [ enhanced version available to lexis.com...

You Won’t Believe This Case -- I Did Not Make This Up. Really!

Imagine this scenario for a second. A man is having marital problems. So he takes the not unreasonable step of visiting his priest to seek guidance. Unbeknownst to the man, however, the priest has been having an intimate relationship with the man’s wife. The priest fails to mention this detail...

Federal Court Lists 10 Requirements For A Reservation Of Rights Letter

“What’s in a name? That which we call a rose by any other name would smell as sweet.” William Shakespeare, “Romeo and Juliet,” Act II, Scene 2. [Well, actually, Wikipedia.] But the same cannot be said of reservation of rights letters. In fact, just the opposite. A letter...

A Dog Bite Coverage Case Gets To A Supreme Court

I love dogs. I love coverage cases. So do the math -- I love dog bite coverage cases. On one hand, I’m glad that there are so many of them. On the other hand, a lot of dog bite coverage cases can mean only one thing -- there are a lot of dog bites. And that’s not a good thing. So it’s...

State Farm’s Relentless Pursuit to Deny Coverage for TCPA Cases

As policyholder lawyers, one can usually count on a few basic mistakes that insurers will make. First, they wrongfully deny coverage and fail to defend. They abandon their insured who is then left to its own devices to protect itself. The policyholder enters into a consent judgment or settlement with...

Below-Limits Settlements Do Not Result In The Loss Of Excess Coverage - Zeig Remains Guiding Precedent, Even Post-Ali

By Adam G. Unikowsky, Attorney, Jenner & Block LLP Excess insurance policies typically include provisions stating that the policyholder cannot pursue coverage from the excess insurer until the policyholder has received payment from the underlying insurers. One of the most frequently-litigated...

Must Insured First Prove Prima Facie Case? An LLC Is Not an Employee

When an insured acquires an insurance policy the insured promises, among other things, to first prove that when presenting a claim for indemnity the Insured will establish a prima facie (on its face) case that coverage is available. In Network F.O.B., Inc. v. Great American Ins. Co. of New York , Slip...

Notable Insurance Coverage Rulings in the First Half of 2014

By Jonathan Hardin and Feola Odeyemi 2014 is shaping up to be a momentous year in insurance coverage law. State and federal courts have already issued several important coverage decisions this year that nevertheless may have slipped "under the radar." This commentary examines such key rulings...

California Supreme Court Refines the Tort of Commercial Disparagement

The California Supreme Court has issued its decision in the closely watched case of Hartford Casualty Insurance v. Swift Distribution, Inc. , S207172. I reported on the Court of Appeals decision last year on this blog in the post "California Supreme Court to Decide Scope of Implied Disparagement;...

D&O Coverage: The Devil Is In the Details

A five-paragraph opinion by the New York Appellate Division suggests the potentially devastating consequences of ignoring the fine print of Directors & Officers Liability insurance policies. In Associated Community Bancorp., Inc., et al. v. St. Paul Mercury Ins. Co. , 2014 NY Slip Op 04697 (App....

Court Finds Coverage For Settlement Of Restitution Claim

Insurers often take the position that indemnification for claims for “restitution” are barred by public policy, and contend they have no obligation to reimburse a settlement of such claims. They often take this position even if the policy itself states that coverage can only be denied if...

Oops, Insurer’s Poorly Drafted Language Applied As Written; Double Oops, Insured Can’t Complain When New York Law is Applied After It Chose to Reject Missouri Tax

By Jill Berkeley , Partner, Neal, Gerber & Eisenberg LLP An insured under an errors and omissions policy gives timely notice of circumstances during the policy period in effect when it first became aware of its potential civil liability. The E&O insurer acknowledges notice. Many years later...

A-L-I Opener: More On Chapter 3 Of The ALI Principles

In the last issue of Coverage Opinions I took a brief look at what’s up next for the American Law Institute’s “Principles of the Law of Liability Insurance” Project: Chapter 3. In particular I discussed the Principles’s proposed definition of “accident.” It is...

The Philosophical “Products Hazard” Case

There is just something about the Third Circuit’s decision in Allegheny Design Management, Inc. v. Travelers Indemnity Company, No. 13-4263 (3rd Cir. July 11, 2014), [ enhanced version available to lexis.com subscribers ], addressing whether property damage comes within the “products-completed...

Insurer Required to Show Prejudice Because the Reporting Requirement in the Policy Conditions Did Not Transform the Claims-Made Policy Into a Claims-Made-and-Reported Policy

NewLife Scis. LLC v. Landmark Am. Ins. Co. , 2014 U.S. Dist. LEXIS 21469 (N.D. Cal. Feb. 18, 2014), [ enhanced version available to lexis.com subscribers ]. In NewLife Sciences , the district court held that the notice-prejudice rule was applicable to a policy that had a condition requiring claims...

Supreme Court Awards The Kitchen Sink For Insurer’s Breach Of The Duty To Defend

If an insurer is determined to have breached the duty to defend, consequences will attach. It may be that the insurer must pay for the defense costs that it otherwise owed. Or the consequences may be much harsher – the insurer may lose the right to assert otherwise applicable defenses to indemnity...

Insurer Had No Duty to Defend or Indemnify Trademark Infringement Claim Because It Fell Within the Scope of an Intellectual Property Exclusion

North Coast Med., Inc. v. Hartford Fire Ins. Co. , 2014 U.S. Dist. LEXIS 20701 (N.D. Cal. Feb. 17, 2014), [ enhanced version available to lexis.com subscribers ]. In North Coast Medical , the district court held that the insurer had no duty to defend or indemnify its insured in connection with an...

Central District of California Denies Insurer’s MSJ On the Basis That There Was an Issue of Material Fact as to Whether an Alleged Failure to Construct a Home in Accordance With the Residential Community’s CC&Rs Constituted an “Occurrence”

Barks v. Castlepoint Nat’l Ins. Co. , 2014 U.S. Dist. LEXIS 43447 (C.D. Cal. Mar. 26, 2014), [ enhanced version available to lexis.com subscribers ] In Barks , the district court found that there was an issue of material fact as to whether the general contractor’s alleged failure to construct...

PMA v. Aetna: Straight From The Horse’s Mouth: PMA’s Lawyer Still At It Nearly 60 Years Later

As mentioned in the July 23rd issue of Coverage Opinions , the Pennsylvania Supreme Court’s 1967 decision in PMA v. Aetna, [ enhanced version available to lexis.com subscribers ], has long-been a controversial one. The decision holds that the Employer’s Liability exclusion (even when it says...

The Central District of California Holds that an Invasion of Privacy Exclusion Found in a D&O Policy Barred Coverage for a Suit Alleging Violations of the Telephone Consumer Protection Act

LAC Basketball Club, Inc. v. Federal Insurance Co. , 2014 U.S. Dist. Lexis 58836 (C.D. Cal. Feb. 14, 2014), [ enhanced version available to lexis.com subscribers ]. In LAC Basketball Club , the district court held that an exclusion for any claim based on or arising out of invasion of privacy applied...

No Coverage — No Duty to Defend: Personal Injury Offenses Must Be Alleged

Business relationships are often contentious. When a contract to sell a product devolves into a dispute by selling the product under a slightly different name, suits are filed. Insurance is designed to protect the party insured against certain enumerated causes or risks of loss. However, no policy provides...

Ewing’s Undoing’s Ungluing: Appeals Court Follows Ewing And Holds That Contractual Liability Exclusion Precludes Coverage For Construction Defect Claim

In January, the Supreme Court of Texas, in easily one of the most important coverage cases of 2014, held in Ewing Construction Co. v. Amerisure Insurance Co., [ enhanced version available to lexis.com subscribers ], that the “contractual liability” exclusion, contained in a CGL policy, did...

When an Additional Insured Is the Party Seeking Coverage, Courts Must Resolve Ambiguities in a Manner Consistent With the Objectively Reasonable Expectations of the Additional Insured

Transport Ins. Co. v. Superior Court , 222 Cal. App. 4th 1216 (2014), [ enhanced version available to lexis.com subscribers ]. In Transport Insurance Co. , the California Court of Appeal held that because the additional insured was the party seeking coverage, ambiguities found in the insurance policy...

MUST READ Reservation Of Rights Case (A Top 10 Case Of 2014)

I’m capable of writing a hyperbolic headline in Coverage Opinions now and then. Really, I am. But this isn’t one of them. If you read only one article in this issue of CO , make it this one. In Builders & Exteriors, Inc. v. Mid-Continent Casualty Co., No. WD 76880 (Mo. Ct. App. Sept...

Insurer Cherry Bombs: Court Holds That Pollution Exclusion Does Not Apply To Fireworks [Yes, Fireworks]

One of the things that makes the pollution exclusion such a fan-favorite is that its applicability is sometimes tested against unusual substances, i.e., ones that don’t necessarily shout pollution when come across. For example, just since 2011, courts have addressed whether such things as aroma...