News & Analysis as of

Replacement Costs

Termination for convenience: What is the contractor entitled to?

by White & Case LLP on

Construction contracts often include termination for convenience clauses. Three recent cases highlight the potential financial implications of terminating for convenience....more

Depreciation of Labor Costs Class Action: Nebraska Supreme Court Rules In Favor of Insurer

I’ve regularly followed on my blog key developments in the numerous class actions against the insurance industry involving the application of depreciation to the labor cost component of estimated replacement cost value in...more

California Supreme Court Endorses the Insurance Commissioner’s Authority to Regulate Wayward Insurers

by Nossaman LLP on

On Monday, the California Supreme Court revived a 2011 insurance regulation designed to protect homeowners from underinsurance because of the insurance company’s use of potentially misleading estimates for home replacement...more

California’s High Court Gives Insurance Regulators New Tools To Broaden Authority

by Carlton Fields on

Nearly two years ago, a California appellate court invalidated a rule promulgated by the state’s Insurance Commissioner, on the ground that the regulator lacks authority to prohibit “deceptive acts or practices” which are not...more

California Supreme Court Upholds Replacement Cost Estimate Regulation (For Now)

by Cozen O'Connor on

In 2011, the California Insurance Commissioner promulgated a regulation governing replacement cost estimates for homeowners insurance (Cal. Code Regs., tit. 10, §2695.183 [the Regulation]). After the trial court and...more

California Supreme Court Upholds Insurance Commissioner’s Authority to Regulate Replacement Cost Estimates

In Assn. of Cal. Insurance Companies v. Jones ( No. S226529, filed 1/23/17), the California Supreme Court reversed trial and appellate court decisions to hold that California’s Insurance Commissioner Dave Jones had the...more

Hurricane Season: Time to Determine Whether You're Covered for Weather

by Reed Smith on

June 1 brings the beginning of the 2016 hurricane season. These storms have the potential to cause devastating damage for companies who own property such as apartment buildings, hotels, factories, retail outlets, warehouses...more

Food Recall Events: The Importance of Evaluating Your Insurance Coverage Before a Voluntary and Mandatory Food Recall

by McCarter & English, LLP on

Food recalls are on the rise as consumer protection regulations become more stringent, and they can be costly events. There can be significant expenses associated with removing impacted products from stores; reimbursing...more

Washington Federal Court Finds Assignment Of Replacement Cost Holdback Not Permitted Prior To Actual Rebuilding Or Replacement

In Sherard v. Safeco Ins. Co. of Am., 2015 U.S. Dist. LEXIS 138548 (W.D. Wash. Oct. 9, 2015), Safeco Insurance (“Safeco”) issued a landlord insurance policy to Plaintiffs, Carol Sherard and Glenn Sherard for a rental house in...more

Consequential Loss in Energy Commodity Contracts

by King & Spalding on

Energy commodity contracts can be of significant monetary value, and their breach may expose the defaulting counterparty to significant liabilities for contractual damages. In considering potential liabilities, contracting...more

Insurer Rolls A Gutter Ball On Claim That Insured Bowling Alley Waived Replacement Coverage

In Bowlers’ Alley, Inc. v. Cincinnati Ins. Co., 2015 U.S. Dist. LEXIS 70090 (E.D. Mich. May 31, 2015), the insured bowling alley suffered flood damage that caused warping of several bowling alleys. The insured further claimed...more

True To Form: Eleventh Circuit Rules Rejects Penalties for Non-Conforming Policies

by Carlton Fields on

Insurance contracts are subject to numerous statutes and regulations specifying whether and how certain facts must be disclosed, certain coverages must be offered and certain coverage options must be accepted or declined. ...more

OEM Disclaimers Withstand Challenge in Helicopter Crash: Damage to helicopter from defective part constitutes excluded...

On July 2, 2015, the U.S. District Court for the Eastern District of New York issued a decision in City of New York v. Bell Helicopter Textron, Inc., 13 CV 6848 that left the plaintiff without any remedy against the...more

Missouri Court: “Equivalent” Requires that Replacement Siding be Both Equal in Value and Virtually Identical

by Cozen O'Connor on

In December, we published a post about a Minnesota Supreme Court case that held that under a replacement cost policy, the phrase “comparable material and quality” meant that all of the siding on 20 buildings had to be...more

Striking Down Regulation On Replacement Cost Estimates, A California Court Heads Off Policyholder Litigation

by Carlton Fields on

Last week, in Association of California Ins. Cos. v. Jones, B238622 (Cal. Ct. App. Apr. 8, 2015), a California appellate court affirmed a decision that invalidated a regulation governing estimates of replacement costs made by...more

Wake up Call for Regulators and Insurers

by Carlton Fields on

On April 8, after a careful statutory analysis, the California Second Appellate Division held that the California Insurance Commissioner exceeded his authority in promulgating a regulation that defined a new act as an unfair...more

A New Twist in the California Debate Over Allegedly Inadequate Replacement Cost Limits in Homeowners’ Policies

by Cozen O'Connor on

The April 8, 2015 decision of the California Court of Appeals in Ass’n. of Cal. Insurance Companies v. Jones, 2015 WL 1569669, 2015 Cal. App. LEXIS 298 (Cal.Ct.App., Apr. 8, 2015) held that the state’s Insurance Commissioner...more

Texas Court Talks Insurance And Actual Cash Value

by Zelle LLP on

When an insured suffers a property loss, the insurance policy defines the parameters of recovery. Typically, a property insurance policy’s default valuation provision for a property loss is the actual cash value of the...more

California Insurance Commissioner Lacks Authority to Regulate Formula for Estimating Replacement Cost Value

In Assn. of Cal. Insurance Companies v. Jones ( No. B248622, filed 4/8/15), a California appeals court held that California’s Insurance Commissioner Dave Jones lacked the authority to promulgate California Code of...more

Minnesota Holds “Comparable Material and Quality” Requires Wholesale Replacement Where Undamaged Siding Is Faded

by Cozen O'Connor on

Matching issues are frequently problematic when storms damage only portions of an insured structure’s exterior and it proves impossible to replace the damaged sections with material that is an exact match for the rest of the...more

What The Hail Is Going On With Texas Insurance Claims?

by Zelle LLP on

The onslaught of new hail damage lawsuits does not appear to be ending anytime soon. The docket of every county in which a significant hail event has occurred in recent years sees numerous new hail damage lawsuit filings...more

Court Clarifies Insurers’ Replacement-Cost Obligations

by Zelle LLP on

Amid the onslaught of Texas hail claims litigation, one Texas federal district court recently confirmed that in order for an insured to receive any portion of a replacement-cost holdback under a property insurance policy, it...more

New York Court of Appeals Holds Property Policy Time Limitation for Replacement Costs Suits Amounts to “Claim Nullification”

by Wilson Elser on

Facts and Underlying Litigation - Will New York courts enforce a time-limitation period for suits for replacement costs against an insurer under a property policy, even if the insured could not have completed the...more

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