Category: Insurance

Broader Coverage May Still Be No Coverage At All: The First Department’s Application of the Prior Pending Claim Exclusion 0

Broader Coverage May Still Be No Coverage At All: The First Department’s Application of the Prior Pending Claim Exclusion

The recent decision by New York’s Appellate Division, First Department in Executive Risk Indemnity, Inc. v Starwood Hotels & Resorts Worldwide, Inc., serves as a grim reminder to insureds to pay careful attention at the time of policy renewal to existing demands from third parties, applicable terms and conditions of expiring and renewal policies, differences in the scope of coverage, and appropriate disclosures. Those who do not run the risk of foregoing the insurance they thought they had without even realizing it.

Lack of Actual Notice Does Not Defeat Policy Exclusion When Insurer Made Sufficient Efforts to Provide Clear and Direct Notice of New Exclusion to Policyholder 0

Lack of Actual Notice Does Not Defeat Policy Exclusion When Insurer Made Sufficient Efforts to Provide Clear and Direct Notice of New Exclusion to Policyholder

The recent decision in MDC Acquisition Co. v. North River Insurance Co., serves as a reminder of the impact that clear and direct notice of policy changes will have on the scope of available insurance coverage. Although rendered by the Northern District of Ohio, the decision is based upon generally accepted legal principles that apply in most jurisdictions and is noteworthy for both insurers and policyholders.

New York Appeals Court Allows Grouping of Claims to Avoid Individual Deductibles 0

New York Appeals Court Allows Grouping of Claims to Avoid Individual Deductibles

One of the threshold – if not determinative – issues in many insurance coverage disputes is the number of “occurrences” that are presented by a particular set of facts relating to a claim submitted by the policyholder. In a recent decision, a New York appeals court has concluded not only that the relevant policy language allows for grouping of claims into similar “occurrences,” but that additional discovery may be conducted of the parties’ intent and the insurers’ underwriting guidelines and procedures relating to the relevant policy terms. In Mt. Kinley Ins. Co. v. Corning Inc., the Court affirmed the Trial Court’s denial of summary judgment, concluding that the insured’s comprehensive general liability (“CGL”) policies’ “occurrence”-related terms allowed for grouping of claims arising at a common location or at approximately the same time, which may result in a drastically reduced number of deductibles under the applicable policies. Thousands of individuals had brought separate claims against the insured — Corning Inc. — as a result of exposure to two asbestos-containing products. At issue on summary judgment was whether each of these individual claims constituted a separate “occurrence” under Corning’s primary, excess, and umbrella CGL policies, such that each claim would be individually subject to a deductible before the insurers’ coverage was implicated.

Third Circuit Affirms Bankrupt Asbestos Defendants’ Transfer of Insurance Recovery Rights to Personal Injury Trusts Notwithstanding Insurance Policies’ Anti-Assignment Provisions 0

Third Circuit Affirms Bankrupt Asbestos Defendants’ Transfer of Insurance Recovery Rights to Personal Injury Trusts Notwithstanding Insurance Policies’ Anti-Assignment Provisions

The U.S. Court of Appeals for the Third Circuit, in its May 1, 2012, decision in In re: Federal-Mogul Global, Inc. held that asbestos defendants who file Chapter 11 petitions and seek to resolve their asbestos-related liabilities through the creation of a personal injury trust under Section 524(g) of the Bankruptcy Code may transfer their rights under their liability insurance policies to the trust notwithstanding the policies’ anti-assignment provisions.

Failure to Strictly Comply With the Express Terms of the Notice Provisions in a Claims-Made Insurance Policy Will Forfeit Available Coverage 0

Failure to Strictly Comply With the Express Terms of the Notice Provisions in a Claims-Made Insurance Policy Will Forfeit Available Coverage

The Third Circuit’s recent decision in Atlantic Health System Inc. v. National Union Fire Insurance Company of Pittsburgh confirms the importance of strictly following the notice requirements of a claims-made policy and the relevance of the parties’ course of prior and subsequent performance on the ultimate interpretation of allegedly ambiguous policy terms and conditions. In this case, the failure to strictly comply with the notice requirements resulted in AHS retaining liability for more than $2 million of defense costs and settlement payments.

Claims Handling Manuals Discoverable in Bad Faith Insurance Actions 0

Claims Handling Manuals Discoverable in Bad Faith Insurance Actions

In Platt v. Fireman’s Fund Insurance Company, the Eastern District of Pennsylvania held that an insurer sued for insurance coverage benefits and for bad faith under Pennsylvania law was required to produce any material which pertains to instructions and procedures given to the adjuster for adjusting the plaintiff’s claims.

Pennsylvania Appellate Court Finds No Bad Faith When Insurer Demands Examination Under Oath of Insured’s Indicted Principal 0

Pennsylvania Appellate Court Finds No Bad Faith When Insurer Demands Examination Under Oath of Insured’s Indicted Principal

On cross appeals from a $1.4 million judgment, the Superior Court of Pennsylvania, in Portside Investors, L.P. v. Northern Ins. Co. of N.Y., affirmed judgment in favor of an insured for breach of a property insurance policy, but also affirmed judgment in favor of the insurer on the insured’s statutory claim for bad faith under 42 Pa.C.S.A. § 8371.