Mealey's Catastrophic Loss : Mealey's : Legal News & Analysis

Mealey's Catastrophic Loss

May 24, 2024
Bad Faith Claims Proceed; Fact Issue Exists On Whether Additional Covered Is Owed

LAKE CHARLES, La. — A homeowners insurer is not entitled to partial summary judgment on its insureds’ bad faith claims arising out of a dispute over coverage for hurricane damages because a question of fact exists as to whether additional payments were owed and withheld under the policy by the insurer, a Louisiana federal judge said.
May 24, 2024
California Jury Awards Sisters $18M In Bad Faith Suit Over Flood Damage

SAN BERNARDINO, Calif. — A California jury awarded two sisters $6 million in past noneconomic losses and $12 million in punitive damages after finding that insurers committed breach of contract and acted in bad faith in their handling of the insureds’ property damage claim arising from a 2019 flood.
May 24, 2024
Appraisal Is Premature, Florida Panel Rules, Reverses Hurricane Irma Coverage Suit

MIAMI — A Florida appeals panel agreed with an insurer that an appraisal in a Hurricane Irma coverage dispute is premature because an evidentiary hearing is first necessary to conclude whether a condominium association insured satisfied post-loss conditions under a commercial insurance policy, reversing a lower court’s ruling ordering appraisal and remanding.
May 24, 2024
Texas High Court: Lower Court Did Not Lack Jurisdiction In Storm Coverage Dispute

AUSTIN, Texas — The Texas Supreme Court held that Texas Insurance Code Section 2210.575(e)’s requirement that a trial judge presiding over a lawsuit against the Texas Windstorm Insurance Association be appointed by the Judicial Panel on Multidistrict Litigation is mandatory but not jurisdictional, reversing an appeals court’s finding that the lower court lacked subject matter jurisdiction over a storm damage coverage suit and remanding for further proceedings.
May 23, 2024
Guaranty Association Answers Hurricane Damage Claims, Says Allegations Lack Facts

NEW ORLEANS — The Louisiana Insurance Guaranty Association (LIGA) responded to a homeowner’s petition for damages by stating that the allegations against LIGA are not factual but are legal conclusions regarding the homeowner’s claims that his now-insolvent homeowners insurer, for which LIGA is successor in interest, failed to adequately compensate him for alleged losses related to Hurricane Ida.
May 20, 2024
5th Circuit Refuses To Rehear Dispute Over $1M Settlement Of Canceled Music Festival

NEW ORLEANS — The Fifth Circuit U.S. Court of Appeals denied an insurer’s petition to reconsider its reversal of a lower federal court’s summary judgment ruling in its favor in the insured’s lawsuit seeking coverage for an underlying $1 million class action settlement arising from the insured’s refusal to refund ticket sales for the South by Southwest festival that was canceled due to the COVID-19 pandemic, refusing to disturb its finding that the policy’s contract and professional services exclusions do not bar coverage.
May 20, 2024
Massachusetts Panel Affirms Dismissal Of Restaurants’ Coronavirus Coverage Suit

BOSTON — A Massachusetts appellate panel on May 20 affirmed a lower court’s grant of an insurer’s motion to dismiss a coverage lawsuit arising from the coronavirus pandemic, concluding that the restaurant insureds failed to demonstrate that the coronavirus physically altered or affected their insured property in any way.
May 20, 2024
U.S. High Court Denies Insurer’s Certiorari Petition In Arbitration Dispute

WASHINGTON, D.C. — The U.S. Supreme Court on May 20 denied a commercial property insurer’s petition for writ of certiorari seeking review of the Alabama Supreme Court’s dismissal of its appeal of a lower court’s order denying its motion to invoke the policy’s appraisal procedure in a Hurricane Sally coverage dispute.
May 16, 2024
Panel Amends Opinion After Insureds Seek Clarification In COVID-19 Coverage Suit

SAN FRANCISCO — The Ninth Circuit U.S. Court of Appeals on May 15 filed an amended memorandum indicating that its reversal of a lower federal court’s denial of leave to amend a claim under an insurance policy’s Crisis Event provision applied to two sets of insureds in a coronavirus coverage dispute.
May 16, 2024
Judge Cleans Up Docket, Closes Hurricane Coverage Suit Against Insolvent Insurer

LAKE CHARLES, La. — A Louisiana federal judge on May 15 issued an order administratively closing a homeowner’s breach of contract and bad faith suit over Hurricane Laura damage after the case had been stayed for almost a year due to the insurer’s insolvency, finding that “[n]early four years have passed since Hurricane Laura and the court wishes to clean up its docket.”
May 15, 2024
New Jersey Panel Reverses Ruling In Insurer’s Favor In Storm Damage Dispute

TRENTON, N.J. — A New Jersey appeals court reversed a lower court’s summary judgment ruling in favor of an insurer in an insured’s breach of contract and bad faith lawsuit arising from storm damage claim, concluding that a construction company’s invoices sufficiently established a prima facie showing of disputed facts as to how much property damage was “causally related” to a fallen tree limb, preventing summary judgment.
May 15, 2024
Coverage For Water Damages Limited To $10K Under Homeowners Policy, Panel Says

HOUSTON — No additional coverage is owed under a homeowners policy for water damages caused by water pipes that burst as a result of power outages and freezing temperatures in the wake of Winter Storm Uri in Texas because the policy’s water damage endorsement clearly limits coverage under the policy to $10,000, the First District Texas Court of Appeals said May 14 in affirming a trial court’s ruling on breach of contract and extracontractual claims.
May 14, 2024
Ohio Panel: No Coverage Owed For Settlement Of Claims Insured Financed Terrorists

CINCINNATI — An Ohio appeals panel held that a lower court correctly granted summary judgment in favor of insurers in their lawsuit seeking a declaration that they have no duty to indemnify their mutual insured against an underlying settlement of a lawsuit alleging that it illegally financed terrorist groups in the Republic of Colombia.
May 13, 2024
Judgment Granted For Guaranty Association In Bad Faith Suit Over Hurricane Damage

LAFAYETTE, La. — A Louisiana federal judge granted the Louisiana Insurance Guaranty’s (LIGA) motion for summary judgment in a bad faith and breach of contract suit filed against a now-insolvent homeowners insurer over purported hurricane damage, finding that LIGA, which was substituted as a defendant for the insurer after it became insolvent, established that it was prejudiced by a lack of notice regarding the alleged damage.
May 10, 2024
3rd Circuit Denies Ralph Lauren’s Motions To Remand Coronavirus Coverage Suit

PHILADELPHIA — The Third Circuit U.S. Court of Appeals on May 9 denied Ralph Lauren Corp.’s motions seeking to vacate and remand a New Jersey federal court’s ruling in favor of its insurer in a coronavirus coverage dispute.
May 08, 2024
Insurer Establishes Jurisdiction, Panel Says, Reverses Ruling In Storm Damage Suit

NEW ORLEANS — The Fifth Circuit U.S. Court of Appeals on May 7 reversed a lower federal court’s judgment dismissing an insurer’s petition to appoint an umpire for lack of diversity jurisdiction and remanded the case for the lower court to consider the insured’s additional subject matter jurisdiction arguments, finding that the insurer’s petition establishes an amount in controversy of more than $75,000.
May 07, 2024
Insurer’s Unopposed Motion To Compel Arbitration Granted In Hurricane Ida Dispute

NEW ORLEANS — A federal judge in Louisiana granted an insurer’s motion to compel arbitration and stay a skilled nursing facility insured’s breach of contract and bad faith lawsuit seeking coverage for Hurricane Ida damage, ordering the parties to arbitrate the claims in accordance with the policy’s arbitration provision.
May 06, 2024
5th Circuit Affirms Rulings In Insurer’s Favor In Suit Over Hailstorm Damage

NEW ORLEANS — The Fifth Circuit U.S. Court of Appeals on May 3 affirmed a lower federal court’s ruling in favor of an insurer in a breach of contract and bad faith coverage dispute arising from hailstorm damage, finding that the lower court “correctly identified and applied governing law” in denying the insureds’ breach of contract, extracontractual and additional attorney fee claims and dismissing as moot their claim under the Texas Prompt Payment Claim Act.
May 06, 2024
Iowa Majority Reverses No Coverage Ruling In Suit Arising From Derecho Damage

DES MOINES, Iowa — A majority of the Iowa Court of Appeals reversed a lower court’s ruling in favor of an insurer in a breach of contract lawsuit seeking coverage under a force-placed insurance policy for property damage caused by a derecho, finding that the plaintiff is an intended third-party beneficiary under the policy because the contract manifested an intent to benefit him.
May 03, 2024
Louisiana Panel Affirms Ruling In Suit Arising From Hurricanes Laura, Delta

LAKE CHARLES, La. — A Louisiana appeals panel affirmed a lower court’s ruling in favor of a church, its attorneys and its property insurer in a pro se litigant’s lawsuit alleging that they settled a hurricanes Laura and Delta property damage action in bad faith, finding that the lower court did not abuse its discretion in denying the appellant’s motion to recuse.
May 03, 2024
Georgia Panel Affirms Directed Verdict In Insurer’s Favor In Storm Damage Dispute

ATLANTA — A Georgia appeals court affirmed a lower court’s directed verdict in favor of a homeowners insurer in a breach of contract lawsuit arising from storm damage, finding that the state high court’s ruling in White v. State Farm Fire & Casualty Co. supports its reading of the insurance policy and forecloses the insureds’ assertion that their policy included a “broadly applicable two-year suit limitation as a matter of law.”
May 03, 2024
Insureds Defend Their Appeal To N.C. Supreme Court In Coronavirus Coverage Suit

RALEIGH, N.C. — Restaurant insureds defended their appeal asking the North Carolina Supreme Court to reverse an appeals court’s reversal of a lower court’s grant of partial summary judgment in their favor in a COVID-19 coverage dispute, asserting that a “careful examination makes clear that its policy as interpreted under North Carolina’s specific laws provides coverage for its losses.
May 03, 2024
Judge: Insured’s Attachments To Complaint Contradict Physical Dispossession Claims

CHICAGO — A federal judge in Illinois granted an insurer’s motion to dismiss an insured’s lawsuit alleging that the insurer wrongfully denied coverage for losses that its predecessor-in-interest incurred from governmental shutdown orders in response to the coronavirus pandemic, finding that the insured’s physical dispossession allegations are contradicted by its own attachments to its complaint that demonstrated that the shutdown orders did not completely bar employees from accessing the company’s facilities.
May 01, 2024
10th Circuit: Insurer’s Coverage Denial For Steel Collapse Not In Bad Faith

DENVER — A 10th Circuit U.S. Court of Appeals panel on April 30 affirmed a Wyoming federal judge’s finding that a building owner insured is owed no coverage under an insurance policy’s additional abrupt collapse coverage, finding that the building owner did not show that the insurer or its claims service manager acted in bad faith.
April 30, 2024
Policy Limit Paid For Hurricane Damage; Breach Of Contract, Bad Faith Claims Fail

NEW ORLEANS — A Louisiana federal judge on April 29 granted a homeowners insurer’s motion to dismiss breach of contract and bad faith claims brought by an insured whose home was damaged during Hurricane Ida because the insurer paid the policy limits owed to the insured and the insured failed to include any facts in support of the claims.