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Mealey's Insurance

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.
May 06, 2024
Insurer, Insureds Settle Water Damage Coverage Suit; Stipulation Of Dismissal Filed

DENVER — A homeowners insurer and its insureds filed a stipulation of dismissal in Colorado federal court following the settlement of the insureds’ breach of contract and bad faith suit arising out of the insureds’ water damage coverage claim.
May 06, 2024
Question Of Law Exists On Communicable Disease Exclusion, Insurer Says

NEW YORK — A commercial lines insurer filed a motion for interlocutory appeal to the Second Circuit U.S. Court of Appeals, arguing that a question of law exists as to 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 06, 2024
Interlocutory Appeal Sought On Choice-Of-Law Ruling In Contamination Coverage Suit

EAST ST. LOUIS, Ill. — Insurers filed a motion to certify an Illinois federal judge’s choice-of-law ruling for interlocutory appeal to the Seventh Circuit U.S. Court of Appeals, contending that an interlocutory appeal will advance the environmental contamination coverage suit toward resolution.
May 06, 2024
Insured Files Notice Of Appeal To 7th Circuit In Radiation Exposure Coverage Suit

MILWAUKEE — An insured filed a notice of appeal to the Seventh Circuit U.S. Court of Appeals, seeking review of a Wisconsin federal judge’s ruling that breach of contract and bad faith claims cannot proceed against two commercial general liability insurers because coverage is barred pursuant to the policies’ radioactive materials exclusion for an underlying suit seeking damages for bodily injuries caused by exposure to electromagnetic (EMF) radiation from the insured’s electric transformers.
May 02, 2024
Insurers Seek Dismissal Of BASF’s Coverage Action Tied To AFFF Injury Claims

CHARLESTON, S.C. — Multiple insurers have filed a brief in support of a motion to dismiss an insurance coverage action filed by BASF Corp. in South Carolina federal court related to claims arising from exposure to per- and polyfluoroalkyl substances (PFAS), arguing that there is a “more comprehensive” action BASF has already filed in New Jersey state court.
May 01, 2024
10th Circuit: Insurer’s Coverage Denial For Steel Collapse Not In Bad Faith

DENVER — A 10th Circuit U.S. Court of Appeals panel on April 30 affirmed a Wyoming federal judge’s finding that a building owner insured is owed no coverage under an insurance policy’s additional abrupt collapse coverage, finding that the building owner did not show that the insurer or its claims service manager acted in bad faith.
May 01, 2024
9th Circuit Denies Insureds’ Request To Remand Pollution Coverage Suit

SAN FRANCISCO — The Ninth Circuit U.S. Court of Appeals on April 30 denied a motion filed by insureds for a limited remand to allow a district court to rule on a post-judgment motion in an environmental contamination coverage suit, noting in its order that a review of the record shows that the district court denied the parties’ post-judgment motions without prejudice and that the parties did not file a renewed motion.
April 30, 2024
Insurer Urges 11th Circuit To Affirm Ruling That Pollution Exclusion Bars Coverage

ATLANTA — The 11th Circuit U.S. Court of Appeals should uphold 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 because the policies’ pollution exclusions bar coverage as the generator was stored in a utility closet that was occupied or owned by the insured, the insurer contends in its appellee brief.
April 30, 2024
Insurer, Insured Reach Settlement In Water Damage Coverage Suit

SAN FRANCISCO — An insurer filed a notice of settlement in California federal court after reaching a settlement with its insured in a suit seeking coverage for water damages to the insured’s business.
April 30, 2024
Water Damage Coverage Suit Dismissed Following Parties’ Settlement

SCRANTON, Pa. — A Pennsylvania federal judge dismissed a suit filed by insureds seeking coverage for water damage after the insureds notified the court that they reached a settlement with the insurer.
April 30, 2024
Settlement Reached In Pollution Exclusion Suit; Stipulation Of Dismissal Filed

WASHINGTON, D.C. — An insured and its insurers filed a stipulation of dismissal in the District of Columbia federal court after reaching a settlement in a dispute over whether a pollution exclusion bars coverage for an underlying class action alleging that the insured restaurant’s grain and salad bowls contain harmful levels of fluorine and biocides.