A recent post, Louisiana Policyholders Deserve Good Faith Claims Treatment—Understanding Louisiana Hurricane Claim Bad Faith Law, discussed fundamental Louisiana law requiring insurance companies to treat policyholders in good faith and properly interpret their insurance policies. What happens if insurance companies delay claims following the recent hurricanes in Louisiana?
Continue Reading Understanding Louisiana Bad Faith Law When Claims Payments Are Delayed or Paid Too Late

The previously secret Insurance Services Office (ISO) documents I mentioned in yesterday’s afternoon post, ISO Internal Documents Are Important Regarding COVID Litigation, show a few of the internal actions and analysis of coverage and what to do about a coronavirus pandemic event leading up to the Virus Exclusion Endorsement. These were never provided to the public when the pandemic struck last year, and people were asking about lost business income insurance coverage. Instead, the ISO, its executives, policy experts, and member insurance companies—including their attorneys making arguments preventing this disclosure—have had access to these previously secret documents. Importantly, they were not provided so that judges deciding these cases could consider them and determine if they were relevant and significant to their decisions.
Continue Reading How the Secret Internal ISO Documents Can Be Used to Demonstrate Coverage for Business Interruption Cases

As roadways are cleared of trees and debris and the downed power lines removed, residents begin returning to an unrecognizable community, their home, all landmarks destroyed in the heavily impacted areas. It is like a dream as they begin to navigate lost and in shock. Then, there it is: a remnant of what used to be a home, a business, a school, a store, the townhall—all destroyed. But resolve settles in with determination: “We have insurance. We’ll just rebuild.” And, it begins.
Continue Reading Duty of Good Faith and Fair Dealing After Hurricane Laura – What Now and How Long?

The United States District Court for the District of Minnesota in Selective Insurance Company of South Carolina v. Sela,1 recently addressed whether the implied covenant of good faith includes a broader obligation to act “reasonably” and “properly” in making a decision about whether to pay benefits. Sela had submitted a claim for hail damage to his home. Selective investigated the claim and filed suit alleging that Sela made fraudulent misrepresentations and was not entitled to coverage. Sela counterclaimed for breach of contract, breach of the implied covenant of good faith and fair dealing, and bad faith, pursuant to Minn. Stat. §604.18.
Continue Reading Does the Implied Covenant of Good Faith and Fair Dealing Impose a Broad Duty on Insurers to Act “Reasonably” or “Properly” in Handling Claims?

When an insurance company issues a policy, it is promising to adjust claims with the same care and diligence it would use if it were their own claim.1 Florida provides that insurers owe “a duty to their insureds to refrain from acting solely on the basis of their own interest in settlement.”2 In essence, the insurance company owe a duty to its insureds to abide by the golden rule; do unto others as you would have others do unto you.
Continue Reading Insurance Company’s Golden Rule: Treat Every Claim As If It Were Your Own

I often get calls from potential clients that have filed a claim with their insurance and have been enraged by an insurance agent or adjuster assigned on the claim. Many potential clients say something like “I just wanted to get the claim settled but the adjuster was acting in bad faith and just wouldn’t listen.” Most states have some case law or consumer protection laws that apply to an insurance company, but not all apply to the insurance personnel you deal with. The Supreme Court of Washington will soon decide this issue for members of the Evergreen State.
Continue Reading Is an Adjuster Independently Liable for Bad Faith Conduct?

In a recent op-ed article published in the Star Ledger, Rutgers Law Professor Jay Feinman debunked the myth that insurance companies have been using for decades to prevent good faith claims handling bills from passing through the legislature. As Feinman noted, insurance companies argue that the Insurance Fair Conduct Act (IFCA) is unnecessary and would be harmful, suggesting the bill would dramatically raise insurance premiums.
Continue Reading Rutgers Law Professor Debunks Notion of Increased Premiums With New Jersey Fair Conduct Act

On July 5, 2017, the Second Department gave a very meaningful win for insureds. In McBride v. New York Property Insurance Underwriting Association,1 Nor’easter Nemo struck the insured’s home causing a failure of the electrical system. The failure of the electrical system caused water pipes in the home to burst, causing water damage. New York Property Insurance Association (NYPIUA) denied the claim in its entirety.
Continue Reading Covenant of Good Faith and Fair Dealing Not Duplicative in New York

When it comes to commercial losses, taking the time to view the policy and figure out the applicable laws of the controlling state are necessary. However, sometimes, the basics are forgotten by even the insurance carrier. In an ideal world, losses are cut and dry but the reality is that almost every detail is up for interpretation of some sort. In a commercial loss, often more than one insurance policy kicks in when there is a landlord and tenant situation. The basic rule of thumb is that the landlord’s policy usually covers the real property loss while the tenant’s business personal property is covered under the tenant’s own business policy. However, often these lines are blurred and not definite. In order to determine coverage, both insurers will often request a copy of the lease to decipher whose policy covers what items destroyed.

Continue Reading Denial of Recovery of Tenant Improvements Leads to Breach of Good Faith and Fair Dealing