Specialty Lines
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September 26, 2022
Copper Theft Isn't Covered As Break-In Damage, Insurer Says
An insurer told a Missouri federal court that it shouldn't have to cover $1.4 million in damages caused by copper theft at a St. Louis property robbed on Christmas Day, arguing that its theft exclusion was clear, and that break-in provisions cover entering the premises, not breaking into the HVAC system.
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September 26, 2022
Builder's Misrepresentations Warrant Rescission, Insurer Says
A construction company involved in litigation over work it did in building a school on a military base misrepresented the size and scope of its business when applying for insurance coverage, the company's insurer told a Virginia federal court, seeking to rescind two policies.
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September 26, 2022
Hertz Insurer Asks NY Court To Pause Del. Coverage Suit
A second-layer excess insurer for Hertz asked a New York federal court to enjoin Delaware superior court proceedings brought by the rental car company, accusing Hertz of forum shopping and failing to meet the requirements for coverage of its $16 million U.S. Securities and Exchange Commission penalty.
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September 26, 2022
Waste Co. Says Insurers Owe Coverage For Deal Breaches
A waste management company told a New York federal court that its insurers must reimburse it for losses stemming from numerous breaches of representations and warranties in a transaction agreement in which the company acquired two other waste management entities.
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September 26, 2022
Bank Didn't Show It Suffered Covered Loss, Insurer Says
An insurer said a bank that settled an underlying suit with a car dealership over outstanding loan payments isn't entitled to coverage, telling an Oklahoma federal court that the bank failed to prove it suffered a covered loss when it didn't provide the insurer information it requested about the settlement.
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September 26, 2022
Travelers Can't Rescind Agency's Crime Policies, Gov't Says
Travelers cannot revoke crime policies issued to an organization that oversees government benefit payments, the federal government told a New Mexico federal court, saying the insurer waived its right to rescission by waiting too long to raise the argument.
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September 23, 2022
Treasure Hunter Seeks Redo Of IP Suit Coverage Dispute
An underwater treasure hunter requested that a Washington federal judge reconsider granting insurance coverage in an underlying lawsuit over his stalled hunt for gold from an early 20th-century Alaskan shipwreck.
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September 23, 2022
2nd Insurer Seeks To Nix Ill. DOI Email Fraud Coverage Bid
A second insurer for the Illinois Department of Insurance asked a federal court to toss the department's $4 million coverage bid for a phishing scheme, saying it had provided social engineering coverage and the agency could not seek additional computer fraud coverage.
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September 23, 2022
Court Denies Zurich's Bid To Skirt Coverage Of Ponzi Suits
Pacific Premier Bank can continue seeking insurance coverage for underlying suits alleging it helped keep a Ponzi scheme afloat by offering ill-advised lines of credit, a California federal judge said Friday, rejecting a Zurich unit's contention that a lending-acts exclusion relieves the insurer of its defense duties.
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September 23, 2022
No Unreasonable Delay In Coverage Denial, Insurer Says
An insurer is fighting back against claims that it waited too long to file a suit to stop defense coverage for a Manhattan law firm accused of misleading a client in a real estate deal.
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September 23, 2022
IRS Drops 6th Circ. Challenge To Voided Microcaptive Notice
The IRS won't challenge a Tennessee federal court's decision setting aside an agency notice requiring the disclosure of microcaptive insurance arrangements, according to an order from the Sixth Circuit on Friday dismissing appeals from the agency and an advisory firm.
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September 23, 2022
9th Circ. Overturns Insurer's Win In ERISA Benefits Suit
The Ninth Circuit reversed a lower court's decision upholding a Hartford unit's termination of long-term disability coverage to a medical device technician who left work due to back pain, saying the insurer didn't do enough to fully investigate the worker's job duties.
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September 23, 2022
No Coverage For SEC Investigation Costs, Insurer Says
Great American Insurance Co. urged a Nevada federal court to rule that it does not have to reimburse an appliance recycling business for defense costs incurred after a U.S. Securities and Exchange Commission investigation.
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September 22, 2022
Insurer Says Investment Co. Can't Sue Under Manager's Policy
A company's lawsuit against its former investment advising manager and the manager's insurer over coverage of an underlying suit should be tossed, the insurer told an Illinois federal court, arguing that the company doesn't have standing to sue under the manager's insurance policy.
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September 22, 2022
Aquatics Teacher Wants Defense Coverage Ruling Reviewed
A therapeutic aquatics instructor asked a Texas federal court to reconsider its decision that an insurer does not have to provide a defense for the instructor in a suit alleging she stole clients from another business.
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September 22, 2022
Fla. Panel Reinstates Radiology Co.'s Unpaid Claim Fight
A Florida appellate panel reinstated a radiology provider's suit against an insurer over unpaid medical bills, finding that a lower court was wrong to rely on a separate judgment declaring an auto policy void as the basis for granting dismissal.
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September 22, 2022
AIG Entities Want Out Of Fla. Telecom Co.'s Coverage Dispute
AIG urged a Florida federal court to toss tortious interference and negligence claims that a wholesaler of international telecommunications lodged against it and its third-party claims administrator, arguing that the coverage fight should really be between the company and the specific AIG unit that provided the policies at issue.
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September 22, 2022
Clifford Chance Adds Ex-Sidley Partner To US Practice
Top international firm Clifford Chance LLP announced on Thursday that a New York-based insurance and financial services partner has joined the firm as co-head of its U.S. insurance practice, adding his more than 23 years of experience in the industry to its team.
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September 22, 2022
Pa. Insurance Chief Says Carriers Wrongly Connecting Claims
The Pennsylvania Insurance Department, which is overseeing the now-defunct Senior Health Insurance Co. of Pennsylvania, told an Indiana federal court that the carrier's own insurers are wrongly refusing to provide coverage for recently filed litigation on the flawed basis that the lawsuit relates back to previous claims.
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September 22, 2022
Travelers Says Goods Stolen Outside Warehouse Not Covered
A Travelers unit told a New Jersey federal court that a "geographic scope" clause in a policy for a skin care company clearly precludes coverage for stolen goods that were stored outside a warehouse.
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September 21, 2022
Bank Says Insurer Can't Void Senior's $5M Life Policy
An M&T; Bank subsidiary told a Delaware federal court that just because an insurer says a $5 million life insurance policy amounts to a wager on a senior citizen's life doesn't mean it should be able to void the policy, pointing to the insurer accepting premium payments on it for years.
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September 21, 2022
Looking Closer At ESG's Environmental Risks For D&O
Companies committing to environmental initiatives under the environmental, social and governance banner should be wary of "greenwashing" claims that could increase risk from a directors and officers insurance perspective, with breach of duty claims and political backlash also lurking as potential sources of risk.
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September 21, 2022
SC Justices Say Auto Policy Does Not Cover Fatal Shooting
The South Carolina Supreme Court reversed on Wednesday an appeals court's ruling and reinstated a summary judgment awarded to Progressive, finding that an automobile policy issued by the company to a man does not cover his wife's fatal injuries when she was shot by the driver of another vehicle.
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September 21, 2022
Blue Shield Seeks E&O Coverage For Reimbursement Suits
Blue Shield of California asked a federal court to find that it's owed millions in insurance coverage for what it spent to defend against lawsuits alleging it failed to reimburse hospitals for emergency room services, arguing the underlying actions are related and so trigger only one self-insured retention.
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September 21, 2022
Insurers Battle To Avoid $844M Plane Crash Compensation
Victims of a deadly plane crash in Colombia sought in a London court on Wednesday to shut down a request by units of Tokio Marine and Aon to stop the victims' pursuit of compensation for the disaster in a Florida court.
Insurer Seeks Apportionment Of Ransomware Claim Costs
Liberty Surplus Insurance Co. said another insurer must reimburse it for what the Liberty Mutual unit spent to cover a manufacturer of sheet metal tools for a ransomware attack, telling a California federal court that a Tokio Marine unit was ducking most of its shared coverage obligations.
Attys, Firms Must Be Careful To Secure Malpractice Coverage
A Georgia federal court's ruling that an attorney lost coverage for a malpractice suit by failing to give her insurer notice of a possible claim underscores the need for lawyers to be extra cautious when reporting potential liability to their carriers, especially with certain types of policies, legal experts say.
2nd Circ. Overturns NRA's Free Speech Win
The Second Circuit found Thursday that an investigation into insurers partnered with the National Rifle Association and a former New York official's statements advising NRA-affiliated businesses to assess their reputational risks did not violate the gun advocacy group's constitutional rights.
Expert Analysis
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What Del. Officer Exculpation Law Means For D&O Insurance
Following a recent Delaware code amendment to allow corporate exculpation of officers, businesses considering whether to update their articles of incorporation accordingly should factor in the potential benefits respecting the availability and cost of directors and officers insurance, say Bryan Coffey and Peter Gillon at Pillsbury.
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7th Circ. 'Reasonable Costs' Ruling Is A Win For Policyholders
The Seventh Circuit's decision in USA Gymnastics v. Liberty Insurance last month establishes useful precedent for policyholders, affirming and expanding on its rule that defense costs are presumed to be reasonable and necessary when insurers breach their duty to defend, say attorneys at Reed Smith.
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Insurance Implications For Aircraft Grounded In Russia
Russia's invasion of Ukraine and new law that allows the government to ground planes leased from foreign companies threatens massive losses for insurers in the aviation insurance market and necessitates a closer look at which policy exclusions may apply, say attorneys at Hinshaw.
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What Snap Removal Debate Means For Insurance Disputes
A potential circuit split regarding the permissibility of snap removal to federal court, which allows defendants to circumvent the forum defendant rule, is particularly a concern in insurance cases due to the difficulty of removing such cases, and the perception that some state courts are more favorable to policyholders, says Greg Mann at Rivkin Radler.
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How D&O Insurers Can Limit Bankruptcy Exclusion Risks
Amid challenging economic conditions, directors and officers underwriters can't always rely on insolvency exclusions to protect against insured's bankruptcy claims, but there are ways to limit risk exposure, like by adding creditor exclusions or sublimiting coverage, say Kristine Christ at Crum & Forster, and Scott Schechter and Joshua DiLena at Kaufman Borgeest.
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Questions Remain On Computer Fraud Coverage For Phishing
There are questions regarding the applicability of computer fraud coverage to phishing scheme losses in the wake of the Ninth Circuit's decision in Ernst & Haas v. Hiscox earlier this year, with a backdrop of differing case results and evolving fact patterns over the past few years, say Robert Callahan and Melissa D’Alelio at Robins Kaplan.
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Insurers Must Be Vigilant About Cannabis Lounge Risks
Because cannabis lounges face a number of unique risks, such as overserving cannabis to patrons, insurers and risk management providers must be able to recognize and properly address the full range of potential liabilities, say Jonathan Isaacson and Adam Nicolazzo at Kaufman Dolowich.
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Insurers Should Beware Risks From Digital Asset Losses
Personal lines insurers should not underestimate the potential severity of future exposure to digital asset loss claims, and should consider protecting themselves with new underwriting practices and policy exclusions, say attorneys at Sidley.
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State Ransomware Payment Laws Raise Insurance Questions
Recent Florida and North Carolina statutory prohibitions on government agencies' ransomware payments will not just affect public entities' response to ransomware incidents, but also require consideration from insurers whose policies may cover ransom payments, say Ted Brown and Mallory Meaney at Wiley.
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Anti-Kickback Circuit Split Holds Implications For Defendants
The Eighth Circuit's recent decision in U.S. v. D.S. Medical represents a significant step toward holding plaintiffs to more exacting burdens of proof in Anti-Kickback Statute False Claims Act suits, and the outcome of the resulting circuit split could decrease estimated damages for defendants, say attorneys at Gibson Dunn.
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8th Circ. Ruling Raises Bar For Anti-Kickback FCA Claims
The Eighth Circuit's decision in U.S. v. D.S. Medical makes it more difficult for plaintiffs to claim that a violation of the Anti-Kickback Statute supports False Claims Act liability, but an emerging circuit split and uncertainty regarding evidentiary requirements must be considered when developing a defense strategy, say attorneys at Winston & Strawn.
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Insurance Tips For Cos. Offering Reproductive Health Benefits
Post-Dobbs state laws allowing legal action against anyone who facilitates an abortion could lead to claims against employers providing reproductive health benefits, so companies must ensure their insurance policies afford sufficient protection for any novel claims, say Heather Habes and Gretchen Hoff Varner at Covington.
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Texas Tax Talk: Ruling May Erode Pro-Taxpayer Presumption
Following the recent Texas Supreme Court opinion in Hegar v. Health Care Service, the state comptroller may try to limit the utility of a long-standing presumption that ambiguous tax statutes must be construed strictly against the taxing authority and liberally for the taxpayer, say attorneys at Baker Botts.