Breaking Down Bad Faith: Insurers’ Good Faith Duties and Defending Bad Faith Claims
JONES DAY PRESENTS®: Insurance Implications of the California Consumer Privacy Act
To combat a perceived litigation tactic by plaintiffs counsel of using settlement demands within policy limits to set up insurers for bad faith, insurance company associations lobbied for statutory clarification to avoid...more
Welcome to CICR’s annual recap of insurance cases you should know about — and others in the pipeline to watch. You can read about our selections for “Cases to Know” and “Cases to Watch” below. In the last year, we saw...more
On March 8, 2021 the California Court of Appeal, reversing a $10 million verdict against Farmers, found that a jury must specifically find unreasonable acts by an insurer to support a “failure to settle” bad faith...more
In Knickerbocker Village Inc. v. Lexington Insurance Co., New York’s Appellate Division, First Judicial Department, dictated a clear rule for single-insured cases regarding the discovery of an insurer’s treatment of insurance...more
An insurer defending a claim against an insured that could exceed policy limits has a good faith obligation to settle the claim if possible. Failure to do so puts a nonsettling insurer at grave risk. An Eleventh Circuit...more
Since 2008, Minnesota has had a bad-faith statute that penalizes an insurance company for its unreasonable denial of a first-party insurance claim. But it was only earlier this month that a Minnesota appellate court...more
In John Patty, D.O., LLC v. Missouri Professionals Mutual Physicians Professional Indemnity Association, No. ED106747 (Mo. Ct. App. Apr. 23, 2019), a Missouri appellate court rejected the lower court’s decision regarding...more
On April 19, 2019, the Eleventh Circuit threw out a putative class action seeking declaratory relief against GEICO, citing the lead plaintiff’s lack of standing. The Eleventh Circuit’s decision was based on the long-settled...more
The Georgia Court of Appeals recently reiterated the fundamentals of contract law within the context of insurance settlement negotiations in Yim v. Carr. ...more
On March 18, 2019, the First Circuit Court of Appeals affirmed a decision holding that Sedgwick Claims Management Services made reasonable and prompt efforts to settle a nursing home liability claim, and therefore was not...more
The Georgia Court of Appeals recently made waves in Hughes v. First Acceptance Insurance Company of Georgia, Inc., 343 Ga. App. 693 (2017). First, it aggrandized the role of a jury in determining the existence of an offer to...more
The New York Court of Appeals recently answered in the negative a question certified to it by the U.S. Court of Appeals for the Second Circuit regarding prior precedent and whether per occurrence liability limits in...more
In Madrigal v. Allstate Indemnity Co., Cause No. 16-55830 (9th Cir. June 15, 2017), the Ninth Circuit upheld a jury award assessing $14 million in bad faith damages, even though it was unclear whether the insurer could have...more
The Third District Court of Appeals finding recently held that in certain circumstances, a third party can maintain a bad faith claim against an insurer even if the insured is not exposed to liability in excess of the policy...more
Earlier this week, the Supreme Court overturned the Court of Appeal’s judgment in AIG Europe Limited v Woodman and others UKSC 2016/0100, ruling on how claims arising from similar acts or omissions in a series of related...more
Until very recently, the scarcity of water and the decline in oil prices in California prompted the joke that oil was being used as fracking fluid to get water out of the ground. In the last week, however, so much rain has...more
Does the efficient proximate cause rule serve to afford coverage for the additional costs to rebuild the foundation of a home in compliance with changed building code requirements beyond the sublimit of liability of an...more
The Second Circuit certified to the New York Court of Appeals the question of whether its 2004 decision (Excess Insurance Co. v. Factory Mutual Insurance Co., 3 N.Y.3d 577 (2004)) imposed “either a rule of construction, or...more
It’s said that “defeat is an orphan,” but insurable losses often have multiple, concurrent causes. In some cases, one or more of those causes might be outside the scope of coverage, either by omission or exclusion. In Sebo v....more
In California, where a primary insurer is found to have unreasonably failed to settle within its policy limits, and a judgment is later entered against their insured in excess of those limits, the primary carrier can be...more
In a recent unpublished decision, the California Court of Appeals upheld a $3 million judgment against an auto liability insurer that rejected proposed language in a settlement agreement, notwithstanding the insurer’s policy...more
In 21st Century Ins. v. Superior Court (No. E062244; filed 9/10/15), a California appeals court confirmed that a defending insurer is not bound by a stipulated judgment entered without its consent, and the fact that the...more
In a new decision, Mesa v. Clarendon National Ins. Co., 2015 WL 5059496, 2015 U.S. App. LEXIS 15203 (11th Cir., Aug. 28, 2015), the Court of Appeals found that the insurer’s claims-handling of multiple claimants did not rise...more
Purscell v. Tico Ins. Co., No. 13-2362, 2015 WL 3855253 (8th Cir. June 22, 2015). Court holds it was not bad faith for insurer to pursue investigation into underlying lawsuit before considering settlement demand. ...more
California Court: Rejected Demand Within Policy Limits Not Necessary for Bad Faith Claim - Why it matters: Insurers must proceed with caution when they become aware that a settlement within policy limits is possible,...more