Larson’s Spotlight on Recent Cases: Uninsured Employers’ Fund and Insolvency of Employee Leasing Company’s Workers’ Comp Carrier

Larson's Spotlight on Uninsured Employers' Fund, Voluntary Withdrawal From Labor Market, Bad Faith, and Going and Coming. Larson's surveys the latest case developments that you need to know about. Thomas A. Robinson, the staff writer for Larson's Workers' Compensation Law , has compiled...

SNR Denton US LLP on Does Pennsylvania Law Impose Liability for Bad Faith Without a Duty to Provide Coverage?

By William T. Barker & Ronald D. Kent, Partners, SNR Denton In Post v. St. Paul Travelers Insurance Co., 691 F.3d 500 (3d Cir. 2012), the Third Circuit, discussing a prior, nonprecedential Third Circuit case, Gallatin Fuels, Inc. v. Westchester Fire Ins. Co. , 2007 U.S. App. LEXIS 19069 (3d Cir...

SNR Denton LLP on Pedicini v. Life Insurance Co. of Alabama: Insurer Acted in Bad Faith by Refusing To Recognize Ambiguity of Policy Language

By William T. Barker & Ronald D. Kent, Partners, SNR Denton In Pedicini v. Life Insurance Co. of Alabama, 682 F.3d 522 (6th Cir. 2012), the Sixth Circuit held that the relevant language in a medical insurance policy was ambiguous and further held that the insurer had acted in bad faith by refusing...

SNR Denton LLP on Jones v. Farmers Insurance Exchange: Whether Insurer's Position Is Fairly Debatable Not Always Susceptible to Summary Judgment

By William T. Barker, Partner, SNR Denton LLP In Jones v. Farmers Insurance Exchange, the Utah Supreme Court held that the district court had erred in granting summary judgment that the insurer's denial of coverage was "fairly debatable" and, thus, not bad faith. This reflects a trend...

SNR Denton on National Surety Corp. v. Hartford Casualty Insurance Co.: No Insurer Liability for Failure To Settle Absent Outrageous Conduct

By William T. Barker, Partner, SNR Denton LLP At one time, Kentucky held that an insurer would be liable to its insured for an excess judgment if the insurer's failure to settle exposed the insured to an unreasonable risk of such a judgment. Language in first-party bad faith cases suggests...

Bullivant Houser Bailey: Washington Supreme Court Announces New Presumption of No Attorney-Client Privilege for First-Party Insurers

By Daniel R. Bentson and Matthew J. Sekits In Washington bad faith actions, first-party insurers now face a presumption that the attorney-client privilege does not apply. In Cedell v. Farmers Ins. Co. of Wash., 2013 Wash. LEXIS 149 (Wash. Feb. 21, 2013) [ enhanced version available to lexis.com subscribers...

SNR Denton on Cedell v. Farmers Insurance Co.: Washington Limits Attorney-Client Privilege in First-Party Bad Faith Cases

By William T. Barker & Ronald D. Kent, Partners, SNR Denton In Cedell v. Farmers Insurance Co., the Washington Supreme Court held that, in a first-party bad faith claim (other than regarding a uninsured or underinsured motorist claim), the insurer's quasi-fiduciary duty of good faith and fair...

Bullivant Houser Bailey: Attorney-Client Privilege Analyzed by Idaho Federal Court in Insurance Company's Bad Faith Case

By Matthew E. Hedberg , Bullivant Houser Bailey PC In an opinion issued April 3, 2013, the Idaho federal district court held that when an attorney participates in the investigation of a claim and provides coverage advice, the facts gathered by the attorney may be discoverable in a bad faith lawsuit...

Montana: No Bad Faith Action Allowed Despite Acquittal for Workers’ Comp Fraud

The Montana Supreme Court recently held that a construction worker who was acquitted of charges that he had committed workers’ compensation fraud by, among other things, constructing and selling furniture to a private investigator may not maintain a civil action against the Montana State Fund,...

California Supreme Court Holds That Unfair Competition Law Can Include Insurance Claims

SAN FRANCISCO — (Mealey’s) The California Supreme Court said August 1 that an insurance policyholder can bring bad faith and false advertising claims against her insurance company under the state’s unfair competition law (UCL; Business and Professions Code Section 17200, et seq. ) and...

California Supreme Court Holds That Unfair Competition Law Can Include Insurance Claims

SAN FRANCISCO — (Mealey’s) The California Supreme Court said Aug. 1 that an insurance policyholder can bring bad faith and false advertising claims against her insurance company under the state’s unfair competition law (UCL; Business and Professions Code Section 17200, et seq. ) and...

Bad Faith Requires Covered Loss – No Coverage For Hurricane Ike Flood Damage Absent Flood Insurance

By Barry Zalma, Attorney and Consultant Insured Must Prove a Covered Loss Lexington Insurance Company (“Lexington”) challenged a breach of contract and bad faith judgment in favor of JAW The Pointe, LLC (“The Pointe”). Lexington asked the Texas Court of Appeal to reverse...

Punitive Damages Over 10:1 Violates Due Process

By Barry Zalma, Attorney and Consultant The fear of every insurer sued for the tort of bad faith is that the jury will run away from reason and punish the insurer in a manner violative of its rights of due process. As the U.S. Supreme Court stated in State Farm Mut. Automobile Ins. Co. v. Campbell...

Maryland Defendants Can Recover Attorneys' Fees Paid by Insurance Company

by Robert A. Scott Litigants that have been forced to defend groundless litigation are entitled to recover their attorneys' fees even if those costs were paid by an insurance company, Maryland's highest court has ruled. In Worsham v. Greenfield [ enhanced version available to lexis.com...

The Texas Blueprint for How to Lower Workers’ Comp Costs

After continued implementation of the 2005 reforms to the Texas workers’ compensation system, and legislative review of the system in 2011, 2013 was a year in which system stakeholders and other interested parties were able to step back and evaluate the current state of the Texas system and better...

The Eastern District of California Holds That A Carrier May Have An Affirmative Duty To Attempt to Settle A Claim Against The Insured When It Is Presented With A Reasonable Settlement Opportunity

Travelers Indem. of Conn. v. Arch Specialty Ins. Co. , 2013 U.S. Dist. LEXIS 169453 (E.D. Cal. Nov. 26, 2013) [ enhanced version available to lexis.com subscribers ] In Travelers , the district court concluded that the carrier must act in good faith in response to reasonable opportunities to settle...

California Court of Appeal Allows Insured to Sue Adjuster Personally for Negligent Misrepresentation and Intentional Infliction of Emotional Distress

By Andrew B. Downs Even though California courts have consistently recognized that employees of insurance companies are not parties to the insurance contract, and thus they cannot be held personally liable for breach of contract or for "bad faith," this month's decision in Bock v...

Another Item For Your Checklist: The Bad Faith Concerns Related To Overreaching Proposed Releases

By David A. Mercer A common scenario: claimant's counsel issues a time limit demand for policy limits and the insurer decides to accept the demand and tender the limits. Once the decision is made to accept the demand, the insurer should go through its checklist of concerns to make sure that each...

The Importance of Proof of Mailing: If Premium Not Paid, Policy Cancelled

Insurance is, by definition, a contract whereby the insurer, for consideration, agrees to defend or indemnify another against a contingent or unknown risk. For an insurance policy to exist, therefore, the person insured must pay the premium (the consideration) charged by the insurer. States, like Florida...

Trial Court Finds Claim for Bad Faith May Survive a Motion to Dismiss Despite Failure to Properly Plead Claim for Breach of Contract

Mortazavi v. Federal Ins. Co. , 2014 U.S. Dist. LEXIS 31555 (S.D. Cal. Mar. 11, 2014), [ enhanced version available to lexis.com subscribers ]. In Mortazavi , the district court found in favor of a carrier on its motion to dismiss the insureds’ claim for breach of contract, but found that the...

It's Not "Bad Faith" For Lenders To Stick To The Terms Of Their Agreements With Borrowers

Last Friday, the Appellate Division provided another reminder that it is not “bad faith” for a lender to abide by the terms of its mortgage with a borrower. In Warner v. Sovereign Bank , borrowers fell behind on their residential mortgage and contacted their lender to request a modification...

California: WCAB Applies Neri Hernandez to Home Health Care Services Cases

The WCAB has issued two noteworthy panel decisions involving home health care services in light of Neri Hernandez (en banc). In each of these decisions, which involved critically injured workers, the WCAB has signaled in very strong terms that it will not tolerate a defendant's bad-faith or frivolous...

Iowa: No Claim for Bad-Faith Denial Could Be Maintained Where Insurer Had Reasonable Basis for Initial Denial

Acknowledging that Iowa law recognized a common-law cause of action against an insurer for bad-faith denial or delay of insurance benefits, and the tort has been extended to include workers' compensation cases, an Iowa appellate court nevertheless affirmed summary judgment in favor of an insurer...

No Good Deed Goes Unpunished: Negligence of Adjuster Not Basis for Bad Faith

Insurance adjusters are people knowledgeable in insurance retained by an insurer for the purpose of assisting the insured in proving a loss to the insurer. A person who expresses to the insured the fidelity and good faith of the insurer. The adjuster is not expected nor required to be perfect. In Murphy...

Recent Developments in California Bad Faith Law and Related Trends

By Tyler Gerking On July 29, 2014, I spoke on a panel about recent developments in California bad faith law and related trends. My co-presenter was Robert K. Scott of The Law Offices of Robert K. Scott, and we gave the presentation at ACI’s 28th National Advanced Forum on Bad Faith Claims &...