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Mealey's Insurance

March 12, 2024
Infectious Disease Exclusion Bars Coverage For Underlying E. Coli Suit, Judge Says

ROME, Ga. — No coverage is owed to an insured for an underlying suit seeking damages for E. coli infections contracted at the insured’s fair because the commercial general liability insurer’s infectious disease exclusion clearly bars coverage, a Georgia federal judge said in granting the insurer’s motion for judgment on the pleadings.
March 12, 2024
Insured Asks 3rd Circuit To Reject Insurers’ Late-Notice Argument In Asbestos Suit

PHILADELPHIA — The Third Circuit U.S. Court of Appeals should reject an attempt by insurers involved in an asbestos coverage suit to rewrite New Jersey’s late-notice law, an insured says in urging the Third Circuit to reverse a district court’s ruling entered in favor of the insurers.
March 11, 2024
S.C. Appeals Court Says Coverage Is Owed For Only Some Remediation Costs

COLUMBIA, S.C. — An insured is owed coverage only for cleaning structures at its wastewater facilities that were contaminated with polychlorinated biphenyls (PCBs) because the contamination of the affected structures constitutes direct physical loss or damage under the policy at issue, the South Carolina Court of Appeals said in partially affirming and partially reversing and remanding a master’s order.
March 08, 2024
Judge Rules For CGL Insurer In Coverage Dispute With Medical Product Manufacturer

CONCORD, N.H. — A federal judge in New Hampshire granted a commercial general liability insurer’s motion for summary judgment in its declaratory judgment lawsuit pertaining to 10 underlying class actions alleging that its insured manufactured and marketed medical devices used to clean positive airway pressure (CPAP) and bi-level positive airway pressure (biPAP) devices that were not safe or effective, finding that the damages alleged in the class actions fail to constitute “damages because of ‘bodily injury’ or ‘property damage’” to trigger coverage.
March 07, 2024
Contractor Seeks 6th Circuit’s Review Of Coverage Rulings In Wall Collapse Suit

CHATTANOOGA, Tenn. — Less than two weeks after a building owner filed a notice of appeal to the Sixth Circuit U.S. Court of Appeals, the contractor responsible for the building’s renovation work followed suit and filed its own notice of appeal, seeking review of a Tennessee federal judge’s ruling and judgment entered in favor of the insurer in the dispute between the building owner, contractor and insurer over coverage for the replacement of the building’s wall that fell during renovation work.
March 06, 2024
Washington Judge Partly Grants Insurer’s Motion For Clarification In COVID-19 Suit

SEATTLE —Partly granting an insurer’s motion for partial clarification or reconsideration of a Jan. 4 order denying the insurer’s motion to dismiss the University of Washington’s lawsuit seeking coverage for losses allegedly incurred by its medical and athletic properties in the wake of the coronavirus pandemic, a Washington judge held that the university has pleaded facts to trigger its medical centers’ policies’ communicable disease decontamination cost endorsements; its coverage claims under the athletic properties’ policies are not dismissed and its claims for coverage are not limited to the medical center policies’ time element losses due to contamination by communicable disease endorsements.
March 05, 2024
Panel: No Coverage Owed For Claims Arising From Warehouse Collapse Caused By Tornado

ST. LOUIS — The Eighth Circuit U.S. Court of Appeals on March 4 affirmed a lower federal court’s summary judgment ruling in favor of an insurer in its lawsuit seeking a declaratory judgment that it had no duty to defend or indemnify its insured against underlying wrongful death and personal injury claims arising from a warehouse collapse that was caused by a tornado, finding that there is no coverage because the insured did not own, rent or occupy the warehouse when it collapsed.
March 05, 2024
Reinsurer Seeks Reconsideration In Default Dispute In Settlement Reimbursement Case

OMAHA, Neb. — Arguing in part that “the prima facie standard only applies at the pre-trial stage,” a Brazil-based reinsurer has asked a Nebraska federal judge to reconsider denying its motion to set aside a default previously entered against it in the suit over reimbursement for a settlement reached with Montana regarding alleged asbestos exposure.
March 05, 2024
Insurer Owes Coverage For Suits Arising Out Of Contamination, Panel Affirms

CHICAGO — An environmental premises insurer has a duty to defend its insured against bodily injury lawsuits arising out of an explosion caused when liquid waste in an insured trailer came into contact with an open flame because the liquid waste qualifies as a contaminant under the policy at issue, the Seventh Circuit U.S. Court of Appeals said in affirming a district court’s ruling in favor of the insured.
March 05, 2024
All Sums Allocation Method Applies In Asbestos Coverage Row, Calif. Panel Affirms

LOS ANGELES — A California appellate panel affirmed a trial court’s ruling that an all sums method of allocation applies in an asbestos coverage dispute to an excess insurer’s policy based on the plain language of the insurer’s excess policy.
March 04, 2024
Sanctions Not Warranted Against Insurer In Contamination Suit, Special Master Says

DETROIT — An insurer’s failure to timely produce all documents during discovery in an environmental contamination coverage suit does not warrant an imposition of sanctions, but the insured is entitled to re-depose two of the insurer’s claims analysts regarding information in the documents that were not timely produced, a Michigan federal court special master said.
February 29, 2024
In High Court, Kaiser Insurer Says It Has Standing ‘Twice Over’ In Chapter 11 Case

WASHINGTON, D.C. — The primary insurer of Chapter 11 asbestos debtors Kaiser Gypsum Co. Inc. and Hanson Permanente Cement Inc. is obligated to pay most of the debtors’ debts and is a creditor, giving it standing to object to the debtors’ reorganization plan, the insurer tells the U.S. Supreme Court in a reply brief on the merits.
February 28, 2024
Reinsurers Turn To 2nd Circuit In Oil Seizure Row Involving Insurrection Clause

NEW YORK — Reinsurers who were ordered to pay CITGO Petroleum Corp. more than $72.5 million following a jury trial in a suit stemming from the February 2020 seizure of crude oil at a Venezuelan port and involving a marine cargo reinsurance policy have obtained a supersedeas bond and initiated an appeal.
February 27, 2024
Delaware High Court: Letter About Paraquat Exposure Does Not Constitute Claim

WILMINGTON, Del. — The Delaware Supreme Court on Feb. 26 affirmed a lower court’s finding that an insurer owes a duty to defend its insured against underlying bodily injury suits arising out of exposure to paraquat, a chemical compound manufactured by the insured for use in herbicides, because a letter from a law firm sent to the insured a year before the policies at issue incepted did not constitute a claim for damages.
February 23, 2024
1st Circuit Says Insurer Not Entitled To Reimbursement For Settlement, Defense Costs

BOSTON — A district court erred in finding that an insurer is entitled to reimbursement for defense and settlement costs paid on behalf of its insureds to settle an underlying bodily injury suit stemming from an employee’s contact with raw sewage because the insureds never agreed to reimburse the insurer for any settlement costs and the policy does not include a provision allowing for the reimbursement of costs paid on behalf of the insureds, the First Circuit U.S. Court of Appeals said Feb. 22 in reversing the district court’s rulings related to the insurer’s claim for reimbursement.
February 23, 2024
No Contribution Owed By 2 Other Insurers In Environmental Coverage Dispute

SALEM, Ore. — In two separate opinions issued Feb. 22, the Oregon Court of Appeals reversed two trial court rulings entered in favor of a primary insurer seeking contribution costs from other insurers for environmental cleanup costs incurred by insureds after determining that the insureds’ settlement with one insurer bars the primary insurer’s contribution claim and that the failure to prove that underlying policies were exhausted bars the primary insurer’s contribution claim against an excess insurer.
February 23, 2024
Questions Of Fact Exist On Cause Of Water Damage, Federal Judge Determines

SCRANTON, Pa. — Summary judgment in favor of a homeowners insurer in a water damage coverage dispute is not warranted because questions of fact exist regarding whether the water damage was caused by a long-term leak or a sudden and accidental burst of water, a Pennsylvania federal judge said in denying the insurer’s motion.
February 23, 2024
Building Owner Files Notice Of Appeal To 6th Circuit In Wall Collapse Coverage Suit

CHATTANOOGA, Tenn. — A building owner filed a notice of appeal to the Sixth Circuit U.S. Court of Appeals following a judgment entered by a Tennessee federal judge in favor of the insurer in a dispute between the building owner, contractor and insurer over coverage for the replacement of the building’s wall that fell during renovation work.
February 22, 2024
New Jersey Panel Affirms No Coverage Owed To YMCAs For Losses Arising From Pandemic

TRENTON, N.J. — The New Jersey Superior Court Appellate Division on Feb. 21 affirmed a lower court’s summary judgment ruling in favor of commercial property and casualty insurers in a coverage dispute arising from the coronavirus pandemic, finding that YMCA insureds’ business interruption claims are restricted by their policies’ clear and plain meaning that the court cannot rewrite to cover the “unfortunate losses” they incurred.
February 21, 2024
Magistrate Judge Grants Motion To Strike Bad Faith Claim In Water Damage Suit

SAN FRANCISCO — A California federal magistrate judge denied a business insurer’s motion to dismiss claims for promissory estoppel and unfair competition but granted the insurer’s motion to strike a bad faith claim in the insured’s complaint, which seeks coverage for water damages at the insured’s business, after determining that the bad faith claim is duplicative of the insured’s claim for breach of the implied covenant of good faith and fair dealing.
February 21, 2024
9th Circuit Denies Insurer’s Petition For Rehearing Of Pollution Exclusion Ruling

SAN FRANCISCO — A panel of the Ninth Circuit U.S. Court of Appeals on Feb. 20 denied an insurer’s petition for panel rehearing, refusing to reconsider the panel majority’s finding that a pollution exclusion does not bar coverage for an underlying toxic exposure suit stemming from the cleanup of wildfire debris.
February 20, 2024
Judge Rejects Reinsurer’s Efforts To Quash Service In Settlement Reimbursement Row

OMAHA, Neb. — Ruling that a Brazil-based reinsurer “failed to rebut [an insurer’s] prima facie case of effective service of process,” a Nebraska federal judge denied the reinsurer’s motions to vacate default and quash service in the suit over reimbursement for a settlement reached with Montana regarding alleged asbestos exposure.
February 20, 2024
Marine Transportation Company, Insurer Settle Environmental Liability Coverage Suit

TACOMA, Wash. — An insured marine transportation company seeking coverage for environmental liabilities and defense costs incurred as a result of contamination allegedly caused by the insured’s operations settled its breach of contract and bad faith suit with its insurer, according to a notice of settlement filed by the parties in Washington federal court.
February 20, 2024
Insured Cannot Present Evidence On Request For Future Policy Benefits

RIVERSIDE, Calif. — An insured is not permitted to present evidence in an environmental contamination coverage suit concerning its request for future insurance policy benefits that the insured seeks as damages for an insurer’s alleged bad faith conduct because the request for future policy benefits was not timely filed, a California federal judge said in granting the insurer’s motion in limine.
February 16, 2024
Dispute Over Applicability Of Pollution Exclusion Transferred To D.C. Federal Court

SANTA ANA, Calif. — A suit filed by insurers seeking a declaration that their policies’ pollution exclusion bars coverage for an underlying class action alleging that an insured restaurant’s grain and salad bowls contain harmful levels of fluorine and biocides will be transferred to District of Columbia federal court because the insurance contracts were signed in the District of Columbia and the majority of the witnesses are located in the District of Columbia, a California federal judge said in granting the insured’s motion to transfer the suit.