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Mealey's Insurance

June 04, 2024
Wisconsin Federal Judge Agrees With Insurers On Occurrence Limits Issue

GREEN BAY, Wis. — A Wisconsin federal judge partially granted summary judgment in favor of two insurers in an environmental contamination dispute on the issue of the policies’ occurrence limits, determining that based on the applicable policies’ language, one insurer’s liability is limited to $5 million for each of its three policy periods and the other insurer’s liability is limited to $5 million over the entire three-year period during which its policy was in effect.
May 31, 2024
Professional Services Exclusion Bars Coverage For Carbon Monoxide Injury Suits

SPRINGFIELD, Ill. — A trial court did not err in finding that no coverage is owed for underlying personal injury lawsuits stemming from a carbon monoxide leak because the underlying allegations involve the insured’s rendering of professional services and are therefore barred from coverage by the policies’ professional services exclusion, the Fourth District Illinois Appellate Court said in affirming the trial court’s ruling.
May 30, 2024
Insurers Owe No Coverage For Underlying Judgments In Asbestos Exposure Suits

SAN FRANCISCO — A trial court properly found that two insurers owe no coverage for underlying judgments totaling $41 million entered against their insured in underlying lawsuits arising out of a claimant’s exposure to asbestos in the insured’s products because the policies’ auto exclusions apply as a bar to coverage based on the fact that the claimant was exposed to the asbestos while unloading the insured’s product from the insured’s delivery van, the First District California Court of Appeal said.
May 29, 2024
11th Circuit Says Pollution Exclusion Bars Coverage For Generator Emissions Suit

ATLANTA — The 11th Circuit U.S. Court of Appeals on May 28 affirmed a district court’s ruling that an insurer owes no coverage for underlying suits filed by residents of a condominium building who claim that they were injured as a result of fumes exhausted from a backup power generator, agreeing with the lower court’s conclusion that the policies’ pollution exclusions bar coverage for the generator, which was stored in a utility closet that was occupied or owned by the insured.
May 28, 2024
Questions Of Fact Exist As To Cause Of Damaged Floor, Magistrate Judge Says

MILWAUKEE — A Wisconsin federal magistrate judge denied an insured’s motion for partial summary judgment in a coverage suit stemming from the collapse of the insured’s roof because questions of fact exist regarding the cause of a heaved floor, discovered after the collapse, and whether any of the policy’s exclusions, including those pertaining to earth movement, subsurface water and defects, bar coverage for the damaged floor.
May 24, 2024
N.C. High Court Agrees To Review Clothing Retailer’s Coronavirus Coverage Suit

RALEIGH, N.C. — The North Carolina Supreme Court on May 23 granted a clothing retailer insured’s request to review an appeals court’s ruling that affirmed a trial court’s dismissal of its lawsuit seeking coverage for its losses arising from the COVID-19 pandemic.
May 20, 2024
Talc Debtors Imerys, Cyprus’ Settlement With Insurer Nets $6.25M For Asbestos Trust

WILMINGTON, Del. — A liability insurer for the parent of Chapter 11 asbestos talc debtor Cyprus Mines Corp. will pay $6.25 million to a planned trust to pay asbestos claims after the debtor and affiliates reorganize, according to a settlement agreement that was approved by a Delaware federal bankruptcy judge.
May 17, 2024
Connecticut Judge Strikes Claims Filed Against Insurer In Mold Damage Suit

VERNON, Conn. — A Connecticut judge granted an insurer’s motion to strike bad faith, unfair trade practices and unjust enrichment claims because an additional insured who seeks coverage for mold and property damages related to the collapse of a hallway floor failed to sufficiently support the claims.
May 17, 2024
Pollution Exclusion Bars Coverage For Carbon Monoxide, Insurer Tells 8th Circuit

ST. LOUIS — A pollution exclusion clearly bars coverage for an underlying bodily injury claim stemming from carbon monoxide exposure because carbon monoxide qualifies as a contaminant or irritant under the pollution exclusion, an insurer says, noting in its May 16 appellee brief filed in the Eighth Circuit U.S. Court of Appeals that its interpretation of the pollution exclusion is consistent with North Dakota law.
May 17, 2024
Burden Of Proof In Gas Leak Coverage Suit Will Not Be Shifted To Insurer

LOS ANGELES — A California federal judge rejected an attempt by insureds to shift the burden of proof to an insurer in a dispute over coverage for underlying personal injury claims stemming from a gas leak at an insured facility because the insurer did not breach its duty to defend and because California public policy does not support insureds’ proposed burden-shifting principle.
May 17, 2024
Additional Insured’s Request For Attorney Fees To Proceed In Chemical Coverage Suit

ROCHESTER, N.Y. — An additional insured’s request for attorney fees and costs in a chemical exposure coverage dispute can proceed because the additional insured has alleged sufficient facts in support of its claim for breach of the implied covenant of good faith and fair dealing based on a breach of the insurance contract, a New York federal judge said in denying the insurer’s motion to dismiss and to strike.
May 16, 2024
Insurer’s Claims Related To Pollution, Fungi Exclusions Are Plausible, Judge Says

ATLANTA — A Georgia federal judge on May 15 denied an insured’s motion to dismiss its insurer’s declaratory judgment claims in a mold exposure coverage dispute because the insurer plausibly alleged that its policy’s pollution exclusion and fungi exclusion bar coverage for the underlying mold exposure suit.
May 16, 2024
Parties In Reinsurance Estoppel Row Brief Arbitration Arguments In 7th Circuit

CHICAGO — Parties to reinsurance agreements who disagree on the effects of prior arbitration are wrangling in the Seventh Circuit U.S. Court of Appeals, with the appellee arguing in its response brief that whether estoppel applies to the dispute “is an issue reserved for the arbitrators,” not “a threshold arbitrability question reserved for courts.”
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 15, 2024
Construction Insurance Coverage Suit Tossed After Underlying Suit Settles

AUGUSTA, Ga. — A federal judge in Georgia dismissed without prejudice a declaratory judgment action brought by an insurer that claimed it owed no coverage for claims related to the insureds’ assembly of a manufactured home that sustained water and mold damage after the parties indicated that the underlying suit had been settled.
May 14, 2024
Texas High Court Extends Deadline For Insurer’s Petition For Review In Benzene Suit

AUSTIN, Texas — The Texas Supreme Court granted an insurer’s request for a 30-day extension to file a petition for review of a Texas appellate court’s ruling that a policy’s arbitration provision applies only to disputes arising under the insurance policy and not to disputes arising under a settlement pertaining to benzene-related claims filed against the insured.
May 14, 2024
Insureds Take No Position On Motion For Interlocutory Appeal In Contamination Suit

EAST ST. LOUIS, Ill. — Insureds embroiled in an environmental contamination coverage dispute responded to their insurers’ motion to certify an Illinois federal judge’s choice-of-law ruling for interlocutory appeal to the Seventh Circuit U.S. Court of Appeals, noting that while they disagree with the insurers’ factual and legal analysis in the motion to certify, they understand the insurers’ desire to have the issue reviewed and take no position on the motion for leave to file an interlocutory appeal.
May 08, 2024
COMMENTARY: Bad Faith As A Substitute For Prejudice In Reinsurance Late Notice Disputes

By Robert M. Hall
May 13, 2024
Insured Opposes Interlocutory Appeal, Says No Controlling Question Of Law Exists

NEW YORK — An insured says a commercial lines insurer’s motion for interlocutory appeal of a New York federal judge’s ruling to the Second Circuit U.S. Court of Appeals should be denied because no controlling question of law exists regarding whether a policy’s communicable disease exclusion applies as a bar to coverage for three underlying lawsuits alleging that residents of the insured properties contracted Legionnaires’ disease.
May 13, 2024
Insured Cannot Reassert Bad Faith Claim In Collapse Coverage Suit, Judge Says

PHILADELPHIA — A Pennsylvania federal judge denied an insured’s motion for leave to reassert a bad faith claim against its commercial property insurer in a dispute over coverage for the partial collapse of a building because the insured failed to show that the insurer’s reliance on the policy’s faulty workmanship exclusion to deny coverage was unreasonable.
May 10, 2024
Bad Faith Claim Against Homeowners Insurer In Water Damage Suit Cannot Proceed

HOUSTON — A bad faith claim alleged against a homeowners insurer in a water damage coverage dispute cannot proceed because none of the facts supports a finding that the insurer acted in bad faith in handling the insured’s claim for repair costs, a Texas federal judge said in partially granting the insurer’s motion for summary judgment.
May 09, 2024
Umbrella Insurer Failed To Show No Coverage Owed To Additional Insured, Judge Says

INDIANAPOLIS — An Indiana federal judge on May 8 denied an umbrella insurer’s motion for reconsideration of a summary judgment ruling on a breach of contract claim in a dispute over coverage for an additional insured for underlying lawsuits arising out of a gas explosion because the primary insured’s settlement with the underlying claimants did not extinguish coverage for the additional insured.
May 08, 2024
COMMENTARY: A Primer On PFAS/Forever Chemical Claims: Regulation, Litigation, Large Losses & Insurance Coverage Issues

By Scott M. Seaman and Gar N. Lauerman
May 08, 2024
Insurers Say Coverage Barred In AFFF PFAS Cases Because Harm Arises Out Of ‘Waste’

CHARLESTON, S.C. — A group of insurers has filed a sur-reply brief in South Carolina federal court arguing that the majority of lawsuits against a maker of the firefighting agent known as aqueous film forming foam (AFFF), for which the insurers are being asked to provide coverage, allege harm arising out of “waste,” rather than harm associated with a product put to its intended use, and, therefore, coverage is not owed.
May 07, 2024
Pollution Exclusion Bars Coverage For Dust Emissions Suit, Insurer Says

BROWNSVILLE, Texas — No coverage is owed to an insured for an underlying lawsuit stemming from dust emissions from the insured’s facility because the policy’s pollution exclusion bars coverage for the lawsuit, an insurer maintains in a complaint filed in Texas federal court.