Commentary on insurance and reinsurance disputes and related issues and the website of Schiffer Law & Consulting PLLC
It was bound to happen sooner or later. Finally, an appellate court has weighed in on a COVID-19 property damage coverage dispute. This first appellate decision goes into the insurer win column. So what does it mean for future cases?
Continue reading “What Does the First COVID-19 Appellate Decision Mean?”
Among the discovery sought in many insurance coverage disputes is reinsurance information. This may include the reinsurance contracts that reinsure the underlying policies and communications between the cedent and reinsurer concerning the reinsurance contract or the underlying losses. Courts have been all over the place on this issue, with some only allowing production of the relevant reinsurance contracts and others allowing broad discovery into all facets of reinsurance material.
In a recent case, the court granted reinsurance discovery and found that the insurers failed to meet their burden to avoid production.
Continue reading “The Relevance of Reinsurance Information in a Coverage Dispute”
When bringing a lawsuit there is often strategy to the venue chosen. This is especially true in insurance coverage cases where the outcome can vary by jurisdiction. Another consideration is whether the disputed contract, like an insurance contract, has a forum selection clause, which dictates the venue for the dispute. In a recent case, a court addressed both these issues in deciding a motion to dismiss. The case is a COVID-19 business interruption coverage dispute.
Continue reading “Forum Shopping and COVID-19 Coverage Cases”
There is no question that the COVID-19 restrictions imposed by local and state governments have had an unintentional but devastating effect on businesses both large, medium and especially small. Restaurants, movie theaters, live entertainment, sports. gyms, salons and many other businesses have closed because of the lack of business. While many of these businesses purchased insurance with coverages for business income and extra expense, the lack of direct physical loss of or damage to property has meant that these policies, for the most part, do not cover the loss of business caused by the government shut-down orders.
Continue reading “Brokers and Insurers Prevail in COVID-19 Coverage Action”
COVID-19 business interruption rulings periodically have interesting quirks worth discussing. While the majority of cases are being dismissed at the pleading stage, some are not for various reasons. In a recent Ohio state court case, the motion to dismiss on the pleadings was denied in major part because of an endorsement expanding coverage in a business property policy for a restaurant.
Continue reading “Broad Policy Endorsement Dooms Motion to Dismiss in COVID-19 Case”
It’s been since September that I have blogged about business income and extra expense and civil authority order insurance coverage for COVID-19 closures and the multiple court cases addressing motions to dismiss. That’s because the cases have been coming down by the dozen, mostly, but not always, on the side of the insurance carrier.
In one of the recent cases, another motion to dismiss the complaint granted with prejudice in favor of the insurer, the court’s analysis was extremely thorough and persuasive. But what struck me most was the court’s commentary on the differences chosen by policyholder counsel in articulating the allegations in the complaint. Those differences are obvious and, although I have not done a statistical analysis, it appears those differences often account for the reasons why some courts have not dismissed these COVID-19 cases. What do you think?
Continue reading “While the COVID-19 Dismissals Pile Up, the Allegations May Matter”
Claims-made policies were created to bring more certainty to the insurance relationship. The policies apply generally to claims that are incurred and reported during the policy period or any extended reporting period. If the claim is not reported on time, there is no coverage.
This contractual result often clashes with statutory provisions, like that in New York, which preclude an insurance company from avoiding its obligations because of late notice of claim unless there is prejudice. See N.Y. Ins. Law § 3420(a)(5). In a recent decision, a New York intermediate appellate court made it clear that a claims-made policy still requires timely notice.
Continue reading “Timely Notice Is Required Under a Claims-Made Policy in New York”
An interesting thing sometimes happens when a policyholder with a tower of insurance is sued and settlement discussions involve members of the insurance tower. The excess insurers may look to the primary insurer to defend the claim and to run point on the settlement. The primary insurer, where it is clear that the settlement will be well above the primary insurance limits may look to the excess insurers to lead the settlement discussions. But what happens if the case is not settled and the verdict impacts the excess layers? Does an excess insurer have any recourse if the primary insurer failed to settle the case?
In a recent case in the Eleventh Circuit Court of Appeals, the court found in favor of an excess insurer and against the primary insurer on a failure-to-settle dispute.
Continue reading “Primary Insurer Loses Failure-to-Settle Dispute to Excess Insurer”
Decades ago, professional liability policies, like most liability policies, were written on an occurrence basis. If a claim was incurred during the insurance policy period, the policy would respond to the claim regardless of when the claim was made against the defendant and noticed to the insurance company. As we know from environmental and asbestos claims, that can take decades.
Then along came claims-made polices. Under a typical claims-made policy, if a claim is made against the defendant and reported to the insurance company during the policy period, that insurance policy will respond to the claim regardless of when the occurrence took place (as long as the claim occurred after the policy’s retroactive date). If the claim was made after the policy period and , that policy would
In New York, legislative and regulatory efforts to keep medical professionals practicing in New York led to a quirky medical malpractice insurance system where most primary medical malpractice policies were claims-made policies, but New York medical professionals were provided with excess policies written on an occurrence basis.
This leads to a recent case that explored the issues that arise when occurrence-based excess policies sit on top of claims-made primary policies.
Continue reading “When Claims-Made Primary and Occurrence Excess Policies Clash”
Under New York law, where an insurance policy provides coverage for physical loss or damage of property caused by enumerated causes of loss or perils, the policyholder must establish that the loss was proximately caused by one of the enumerated causes of loss or perils. Often the question is what determines the proximate cause of the loss and how far back should the inquiry into the proximate cause go. In a recent motion court decision, a New York trial-level court discussed the limits of the proximate cause inquiry in a complicated case of confiscation of a leased aircraft by a foreign government.
Continue reading “Loss of Physical Possession of Aircraft Held the Efficient Physical Cause of Loss”
