SOUTH-WESTERN LEGAL STUDIES IN BUSINESS CASE UPDATES—INSURANCE
|
SOUTH-WESTERN LEGAL STUDIES IN BUSINESS CASE UPDATES—INSURANCE
|
|
Title
|
Summary
|
|
Driver Who Has Left Vehicle No Longer Covered by Vehicle Policy
Briefed Case |
Idaho high court held that a sheriff who left his vehicle to assist at a roadside problem, and was hit by a vehicle, was not covered by the underinsured and uninsured policy that applied to his vehicle since he was no longer occupying the vehicle. (Updated June 2008) |
|
Failure to Quickly Notify Insurer Did Not Invalidate Policy
Briefed Case |
Texas high court held that when an insured failed to notify an insurer in a timely manner about a matter that could cause the insurer to defend or indemnify the insured, it did not invalidate the policy. The delay in notification was immaterial as it did not prejudice the outcome of the matter. (Updated May 2008) |
|
Intentional Torts Not Covered by Umbrella Liability Policies
Briefed Case |
South Dakota high court held that an insurer did not have a duty to defend an insured who had a liability umbrella policy and was sued for alienation of affection. The court held that intentional torts are excluded from coverage. (Updated April 2008) |
|
Uninsured Motorist Coverage Did Not Extend to Passenger Injured in Accident
Briefed Case |
Nebraska high court held that the uninsured motorist provision of an automobile insurance policy clearly stated who was covered. Its terms did not include a passenger in a car struck by an uninsured motorist. Insurers have the right to specify who is covered by a policy. (Updated March 2008) |
|
Theft Changes Classification of Vehicle for Insurance Purposes
Briefed Case |
Maine high court held that a peace officer’s personal auto policy covered injuries he suffered when his patrol car was stolen, and the thief ran over the officer. The theft of the vehicle changed its classification from a work vehicle to a stolen vehicle, and the officer’s personal uninsured motorist coverage applied. (Updated March 2008) |
|
Drunk Driver Killed in Accident Not Due Personal Accident Insurance Benefits
Briefed Case |
Appeals court held that a drunk driver who was killed in a one-car accident violated the terms of his Personal Accident Insurance policy as the cause of death was self-inflicted due to voluntary consumption of a large amount of alcohol. (Updated March 2008) |
|
Insurer Has No Duty to Provide Details to Applicant of Health Test Results
Briefed Case |
Appeals court held that a life insurance company had no duty to reveal to a policy applicant the details of blood and urine sample tests used to help set policy rates. (Updated December 2007) |
|
Insurer Not Responsible for Defending Insured for Claim of False Label on Shipment
Briefed Case |
Michigan high court held that a general liability policy did not require the insurer to defend the insured who was sued by a competitor for trademark infringement for shipping the competitor’s product with a label from the insured. That action falls outside of the scope of the policy. (Updated November 2007) |
|
Clock Runs from Date Policy Coverage Could Have Begun
Briefed Case |
Appeals court held that in a claim for underinsured motorist coverage, the clock on the four year statute of limitations began to run when the other motorist’s insurer resolved the matter and the driver’s insurance could then become relevant. (Updated November 2007) |
|
Insurer Responsible for Practical Joke Taken Badly
Briefed Case |
Washington state high court held that an insurer acted in bad faith for failing to defend a client dentist who was sued by an employee who did not like a practical joke the dentist played on her. The tort she claimed to have suffered can be considered an accident for purposes of the policy. (Updated October 2007) |
|
Full Policy Value in Force for Policy Cancelled after Short Time
Briefed Case |
Appeals court held that the full limit of a policy would apply to damages sustained by a policy holder even though the policy was cancelled after three months. The policy did not state that coverage limits would be prorated, so full coverage was in effect. (Updated May 2007) |
|
Consequential Losses Part of Direct Loss under Fidelity Policy
Briefed Case |
Montana high court held that expenses incurred by an employer investigating dishonesty by an employee are part of direct losses that would be covered by a fidelity policy that covers acts of employee dishonesty. (Updated May 2007) |
|
A Building Being Renovated Treated Same as Building under New Construction
Briefed Case |
California high court held that an “under construction exception” to a “vacancy exclusion” that limited coverage would apply to building renovations just as it applied to new construction, hence the vacancy exclusion did not apply when damage occurred during renovation. (Updated March 2007) |
|
Insurer Does Not Cover Legal Fees for Injuries Not Covered by Policy
Briefed Case |
Virginia high court held that an insurer had no obligation to cover the legal fees incurred by a city that successfully defended itself against a bodily injury claim. Since the bodily injuries in question were not covered by the insurance policy, there was no right to collect coverage for legal fees spent on the defense. (Updated January 2007) |
|
No Professional Insurance Coverage for Acts of Fraud
Briefed Case |
Louisiana high court held that professional insurance did not cover fraud by an attorney who cheated his clients. The policy excluded acts of dishonesty, criminality and fraud, so no coverage applied. (Updated January 2007) |
|
Food Lost Due to Mad Cow Scare Caused Business Interruption Insurance to Take Effect
Briefed Case |
Appeals court held that when a U.S. company could not import and use the beef it bought in Canada, because beef imports were prohibited due to the Mad Cow disease, the company suffered a direct physical loss covered by its business interruption insurance. (Updated October 2006) |
|
Terrorism Insurance Did Not Cover Losses Due to Forced of Operations after 9/11
Briefed Case |
Appeals court held that United Air Lines could not recover under its terrorism insurance policy for losses of business when the airline was forced to suspend operation for several days after the 9/11 attacks. The government suspended operations to prevent future attacks. (Updated July 2006) |
|
Asbestos Diseases Not Covered by Accident Insurance
Briefed Case |
Appeals court affirmed that a policy held by an employer that covered “bodily injury by accident” did not apply to asbestos-related diseases suffered by workers. (Updated February 2006) |
|
No Duty to Defend Insured Accused of Intentional Sexual Molestation
Briefed Case |
Rhode Island high court held that a medical malpractice
insurer had no duty to defend or indemnify a physician accused of sexual
molestation of a child-patient who later committed suicide. (Updated July 2005) |
|
Homeowner Insurance Applies to Injury Suffered after
Unloading Vehicle
Briefed Case |
Maine high court held that an injury suffered
when carrying a load from a vehicle into a shed did not involve the vehicle;
the homeowner insurance would apply to the injury even though the policy
excluded injuries suffered while unloading a vehicle. (Updated July 2005) |
|
Sending Junk Faxes in Violation of Federal Law Due
No Insurance Protection
Briefed Case |
Appeals court held that a firm that sent junk
faxes to other companies in violation of federal law, and was sued by the
recipients, could not receive coverage under its commercial general liability
policy, as no coverage is due for such an illegal act. (Updated June 2005) |
|
Loss of Business Income Must Be Caused Directly
by Factors Stated in Policy
Briefed Case |
Appeals court held that a hotel chain was not
due business income loss for the loss of customers who could not travel
by air after the 9/11 attacks. The government did not order the hotels to
close; it temporarily closed aviation. (Updated June 2005) |
|
Serious Deviation in Use of Company Vehicle Negates
Insurance Coverage
Briefed Case |
Texas high court held that an insurer was not
liable on its auto policy when an employee, who was permitted to drive a
company vehicle for business purposes, went on an 80 mile trip while on
a date and crashed when drunk. Such a deviation from normal use terminates
liability responsibility for the insurer. (Updated March 2005) |
|
Insured Can Be Required to Assign Title to Vehicle
to Insurance Company to Collect for Total Loss
Briefed Case |
Appeals court held that when an insurance company
pays the full value for a car when it is stolen or totaled in an accident,
it has the right to enforce the provision in the policy that requires the
insured to assign title to the vehicle to the insurance company as a condition
of receiving payment. (Updated October 2004) |
|
Insurer Must Defend Misuse of Trademark on Company
Website
Briefed Case |
Appeals court held that misuse of a famous trademark
on a website would constitute an “advertising injury.” Hence,
the liability insurer of the company that misused the trademark must defend
the suit brought by the trademark owner for misappropriation. (Updated March 2004) |
|
Disability Due to Surgery Is Injury, Not Illness
Briefed Case |
Appeals court affirmed that a disability suffered
from complications in surgery is classified as a bodily injury, not a sickness.
That meant a different classification for purposes of disability insurance. (Updated February 2004) |
|
Party Must Be Informed of Exclusions in Policy Coverage
for Exclusions to Be Effective
Briefed Case |
Wisconsin appeals court held that a drunk-driving
exclusion in personal accident insurance purchased at the time of renting
a car was not enforceable because the purchaser, who was killed when driving
drunk, was not informed of the exclusion or given a copy of the policy.
Hence the death benefit must be paid to the renter's estate. (Updated February 2004) |
|
Fraternal Organization May Require Arbitration of
Insurance Disputes
Briefed Case |
Appeals court held that life insurance policies
issued by fraternal organizations, which are governed by a Model Fraternal
Code rather than state insurance law, had the right to change their policies
to require that all disputes be resolved by arbitration. (Updated January 2004) |
|
Commercial Insurer Has Duty to Defend Store Employee
Accused of Sexual Molestation
Briefed Case |
High court of SW Legal Virginia held that a commercial
general liability insurer has a duty to defend not only the store-employer
but also an employee of the store who was accused of sexually molesting
a customer. (Updated July 2003) |
|
Physician Able to Perform Some Medical Services
Not Totally Disabled.
Briefed Case |
Maine high court held that a physician
who was unable to perform major surgery, but could perform examinations,
was not totally disabled, and so could not qualify for disability insurance
from his carrier. (Updated April 2003) |
|
Carpal Tunnel Syndrome an Injury, Not Disease, for
Purposes of Disability Insurance
Briefed Case |
Georgia high court held that under
Georgia insurance law, a person who develops carpal tunnel syndrome as a
result of repetitive motions, not as a result of a disease, has suffered
an accidental injury, not a sickness, for purposes of disability insurance
coverage. (Updated April 2003) |
|
Intentional Tort Still Accident from Perspective
of Insured Victim
Briefed Case |
New Hampshire high court held that
when a driver intentionally hit and injured a party who was on foot, the
injured party could recover for his injuries under the uninsured motorist
section of his auto insurance policy. (Updated March 2003) |
|
Houseguest Who Causes Fire Not Subject to Subrogation
Briefed Case |
Appeals court held that it would
not be in the interest of equity to require a houseguest to be liable to
an insurance company that paid for the loss suffered by the homeowner due
to a fire started by the negligence of the houseguest. There is no right
of subrogation in such instance. (Updated March 2003) |
|
Landlord's Insurer May Not File Subrogation
Claim Against Tenant's Insurer without Agreement in Lease
Briefed Case |
Maine high court held that when
a landlord's liability insurance policy pays for damage suffered in a fire
in a tenant's apartment, there is no right of subrogation against the tenant's
insurer unless the lease specifies such a requirement. (Updated March 2003) |
|
Business Income Insurance Applies to Suspension
of Operations, Not Reduced Operations
Briefed Case |
California appeals court affirmed
that business income insurance, which promised to replace income lost due
to suspension of operations due to a casualty loss, such as a flood that
affected a law office, did not apply because the office only reduced operations
during repairs, it did not suspend operations.. (Updated March 2003) |
|
9/11 Attack on World Trade Center Held One
Occurrence
Briefed Case |
Trial court held that insurance
binders are the same as policies and so provide the same coverage as the
policies would when they issue. The court also held that the attack on the
two World Trade Center buildings was one occurrence for purposes of insurance. (Updated January 2003) |
|
Homeowner Insurance Does Not Cover Sale of
Deadly Heroin
Briefed Case |
Appeals court held that a homeowner
who sold heroin in his home, which killed a user in his home, had no right
to insurance coverage in a lawsuit filed by the heirs of the deceased. The
sale of heroin was an intentional act excluded from coverage. (Updated December 2002) |
|
Pollution Exclusion Includes Carbon Monoxide
from Defective Heater
Briefed Case |
A commercial liability insurance
policy for a homebuilder, which contained a pollution exclusion clause,
relieved the insurer of providing coverage for injury caused by release
of carbon monoxide gas from a defective heater installed in a home. The
policy terms were clear in covering such incidents. (Updated November 2002) |
|
Homeowners' Insurance Covers Liability from
Tort Injury Inflicted by Insured
Briefed Case |
Appeals court held that a tort liability
that resulted from a beating inflicted by a policyholder's son on a classmate
was "an occurrence" covered by homeowners' insurance. Therefore the insurer
was liable for the tort judgment. (Updated July 2002) |
|
Oklahoma Supreme Court Holds That Insurers
May Prohibit Policy Stacking
Briefed Case |
The Oklahoma high court held that
a provision in an auto insurance policy that prohibits an insured from stacking
one auto policy on another to increase liability coverage from the same
company, is valid and consistent with the law in most jurisdictions. (Updated April 2002) |
|
Business Use of Property Brings Exclusion
in Homeowner Insurance Policy into Effect
Briefed Case |
The Virginia high court held that
when a homeowner allowed a friend to use some of his property for business
purposes, and that use caused a loss to occur, that the policy exclusion
for damages related to losses caused by business activity came into effect. (Updated March 2002) |
|
Insured Must Give Timely Notice to Insurer
of Event That May Trigger Liability
Briefed Case |
Appeals court held that an insurer
was not liable for coverage when the insured waited 25 years to inform the
insurer of the occurrence of events that could lead to liability under an
insurance policy. There is an obligation to give notice of occurrences as
soon as practicable. (Updated March 2002) |
|
Rental Car Company Is Primary Insurer Despite
Escape Clause
Briefed Case |
Appeals court affirmed that at least
in Washington, a rental car company is the primary insurer of a rented vehicle.
The escape clause that names the renter's insurance company comes into play
only if the rental car company's insurance is exhausted, even if the company
is a self-insurer. (Updated February 2002) |
|
Infringement of Product Design is Not Advertising
Injury Covered by Policy
Briefed Case |
Appeals court held that an insurer
had no obligation to indemnify a company sued for product infringement.
The policy covered misappropriation suits that arose from advertising; the
sale of a product that violates a patent is not an advertising injury. (Updated February 2002) |
|
Pollution Exclusion Does Not Apply to Appliance
Malfunction
Briefed Case |
Ohio high court held that the pollution
exclusion in a general liability policy did not relieve the insurer from
liability in a case where the malfunction of a heater in an apartment caused
carbon monoxide poisoning. The exclusion was not specifically directed at
such an incident and so does not exempt the insurer. (Updated January 1, 2002) |
|
Homeowners Insurance Does Not Cover Business-Related
Injury at Home
Briefed Case |
Appeals court affirmed that the
"business activities" exclusion in a homeowners policy applied to a suit
filed by a worker who suffered an injury when working on the property of
the homeowner on facilities to be used for business purposes. (Updated January 1, 2002) |
|
Insured Party Sued for Damages After Statute
of Limitation Expires Evades Liability
Briefed Case |
Tennessee appeals court held that
in a fatal accident case, where the insured driver who caused the accident
was not identified for more than a year, the statute of limitations had
expired, so he could not longer be made a defendant in a personal injury
suit for damages. (Updated December 1, 2001) |
|
Policy Unclear as to Status of Golf Cart
Is Read in Favor of Insured
Briefed Case |
Appeals court held that where a
homeowner's insurance policy is unclear as to liability coverage for an
injury caused by a golf cart to a pedestrian, where one provision appears
to provide coverage and another provision appears to exclude coverage, the
ambiguity is resolved in favor of the insured. (Updated December 1, 2001) |
|
Divorce Agreement Fixed List of Beneficiaries
of Life Insurance Policy
Briefed Case |
Appeals court held that a divorce
agreement that specified that a father's life insurance policy would list
the two minor children of the marriage as the beneficiaries of his policy
meant that he could not later add other beneficiaries to the policy even
though the agreement did not specifically prohibit that. (Updated November 1, 2001) |
|
Advance Payments Credited Toward Judgment
Only If in Same Damage Category
Briefed Case |
Arkansas high court held that an
insurance company could be credited for payments made to an accident victim
prior to litigation. Advance payments are offset against the jury award
by category. Overpayment by the insurer in some categories will not be offset
against higher amounts awarded for other damage categories. (Updated August 1, 2001) |
|
Minnesota Law Does Not Govern Insurance Dispute
Over Out-of-State Accident
Briefed Case |
Minnesota high court held that, in
an accident involving a Minnesota resident who was injured by a Nebraska
resident in an accident in Nevada, where both parties had insurance from
their respective states, the Nebraska insurer was not subject to Minnesota
law with respect to the issue of whether it had to indemnify the Minnesota
insurer for the payments it made to its policyholder. (Updated August 1, 2001) |
|
Breach of Contract by Health Insurer Is Not
Breach of Fiduciary Duty
Briefed Case |
Appeals court held that although
an insured may have a suit for breach of contract, fraud, and false advertising
against her health insurer for failure to properly review needed medical
care, there is no suit for breach of fiduciary duty because there was no
special relationship that created that duty. (Updated June 1, 2001) |
|
States May Not Tax "Independently Procured
Insurance" from Across State Lines
Briefed Case |
Texas appeals court held that the
state could not impose a tax on insurance purchased by firms doing business
in Texas that obtain insurance on their property in the state from out-of-state
insurance companies not licensed to do business in Texas. (Updated March 1, 2001) |
|
No Bad Faith By Insurer That Properly Evaluated
Claim
Briefed Case |
Court dismissed a suit brought by
an insured hotel owner who was unhappy with the insurer's evaluation of
the damage caused by a hurricane. The insurer appeared to properly evaluate
the claim, notifying the insured at all stages of the process; only later
did the insured protest and hire its own expert. (Updated February 1, 2001) |
|
Accident Victim Must Give Lawsuit Proceeds
to Health Insurer to Cover Medical Expenses
Briefed Case |
Appeals court upheld the right of
an employer's medical insurer to recover the proceeds an injured employee
got in settlement from an accident that caused her to incur over $200,000
in medical expenses covered by the insurer. (Updated February 1, 2001) |
|
Denial of Total Disability Payments Upheld
on Basis of Medical Evidence
Briefed Case |
Court dismissed a suit against an
insurer who refused to pay total disability payment to employee who claimed
disability. While the employee suffered back problems, the medical evidence
was clear that he was not totally disabled, which was what the policy required. (Updated January 1, 2001) |
|
Employee on Medical Leave Is "Active" Employee
for Life Insurance Purposes
Briefed Case |
Appeals court affirmed judgment in
favor of a life insurance policy beneficiary who had been denied benefits
from a policy that covered his wife. Her employer provided the policy. The
insurer had claimed that since she was on medical leave when she was killed
in an accident the policy was not in force. The court held that she was
an "active" employee under the policy. (Updated January 1, 2001) |
|
Death Caused by Pacemaker Not "Accidental Death"
Briefed Case |
Appeals court upheld judgment for
insurer that refused payment of death benefits under an accidental death
benefit policy. The cause of death was the malfunction of a pacemaker, which
allowed a heart problem to cause death. That does not qualify as accidental
death. (Updated December 1, 2000) |
|
Landlord Cannot Sue Tenant for Fire Damage
When Fire Insurance Policy in Effect
Briefed Case |
Court dismissed a suit brought by
a landlord against a tenant who accidentally started a fire that damaged
an apartment. The tenant is a co-insured under a fire insurance policy and
is not subject to subrogation by the landlord or the insurance company. (Updated December 1, 2000) |
|
Long-Time Pollution Leaks, While Unintended,
Were Not Sudden and Accidental
Briefed Case |
Court held that a comprehensive liability
insurance policy that covered damages from "sudden and accidental" pollution
releases does not include damages from long time leaks that caused damage.
Words in policies are to have their ordinary meaning; the leaks were not
sudden. (Updated November 1, 2000) |
|
Title Insurer Negligent But Restores Priority of
Mortgage Company by Equity Rule
Briefed Case |
An appeals court held that a title
insurance company was negligent for failing to discover a lien placed against
property for which a new mortgage was issued. The doctrine of equitable
subrogation allows the new mortgage maker to take the priority of the original
mortgage maker and stop the forced sale of the property to the other lien
holder. (Updated November 1, 2000) |
|
Insurer's Insurance Comes Before Creditor's Insurance
in Case of Insurer Insolvency
Briefed Case |
Rhode Island high court held that
the fund that insures insurance companies in case of their insolvency stood
first in line to pay losses suffered by a homeowner whose property was damaged
and whose insurance company was insolvent. The insurance held by the homeowner's
mortgage company to cover uninsured losses does not have primary liability.
(Updated September 1, 2000) |
|
Lessor Has No Obligation to Ensure that Leased Vehicles
Are Insured
Briefed Case |
Party injured by uninsured leased
vehicle sued leasing company for failing to require lessee of vehicle to
maintain proper liability insurance. Nebraska high court held that in long-term
leases, by law the lessee is considered to be the owner of the vehicle and
so has the obligation to maintain insurance. (Updated June 1, 2000) |
|
Uninsured Motorist Coverage Does Not Apply To Accident
Caused by Hit-and-Run Car That Did Not Strike Insured
Briefed Case |
Appeals court upheld a trial court
decision denying coverage to a motorist by his insurer. The motorist was
struck by a truck that was forced into them by a hit-and-run third party.
Since the third party did not strike the insured vehicle, the uninsured
motorist coverage did not apply. (Updated April 1, 2000) |
|
Insurance Policy May Not Conflict with State Public
Policy
Briefed Case |
Georgia high court held that the
terms of a health insurance policy, which required its policyholders to
reimburse the insurer for health costs when compensation was received from
other sources, violated state policy that favors complete compensation when
the insured was compensated for damages from an automobile accident. (Updated March 1, 2000) |
|
Bite by Dog Sitting in Parked Car Not Covered by
Auto Insurance Policy
Briefed Case |
Iowa high court held that automobile
insurer is not responsible for liability arising from an auto owner's dog
biting a child who approached the parked car, which had a door open. The
injury was not related to the use of the car, so the auto policy did not
apply. (Updated February 1, 2000) |
|
No Duty to Reveal Medical Test Results to Life Insurance
Applicant
Briefed Case |
Appeals court affirmed dismissal
of a case against an insurer brought by the widow of a man who applied for
life insurance but was rejected on the basis of the physical tests given
as part of the application. Applicant died soon after failing the physical,
but insurer had no duty to disclose test results to applicant. (Updated January 1, 2000) |
|
Sublessee of Rental Housing is Resident for Purposes
of Renter's Insurance Policy
Briefed Case |
Appeals court held that a sublessee
of a rented duplex, who used the duplex as her primary residence, was excluded
from coverage for bodily injury she suffered when attacked by her roommate's
dog. Since she was a resident of the duplex, not a visitor, the policy did
not cover her injuries. (Updated January 1, 2000) |
|
Letter Raising Possibility of Claim Against Insured
Did Not Trigger Notice to Insurer Requirement
Briefed Case |
Appeals court held that an insured
had not violated the insurance contract provision requiring that notice
of claims must be made in a timely fashion. The insured was sued more than
two years after it first knew of a potential liability issue. Since there
was no specific claim made originally, the insured did not have a duty to
notify the insurer at that time of the initial correspondence. (Updated November 1, 1999) |
|
Water from Melting Snow Is Surface Water
Briefed Case |
Appeals court held that damage to
personal property caused by melting snow is excluded from coverage in homeowner
insurance that excludes damage from surface water. Melting snow causes surface
water, so such damage is not covered. (Updated November 1, 1999) |
|
Use of More Than One Adjuster Not Bad Faith By Insurer
Briefed Case |
Arkansas high court held that the
use of more than one adjuster to review damages to a home was not evidence
to support a finding of a tort of bad faith by the insurer. However, it
was for the jury to decide if the insurer or home owner was right about
the value of the damages suffered. (Updated October 1, 1999) |
|
Suicide by Driver Is Not an Accident; Auto Insurance
Coverage Does Not Apply
Briefed Case |
Appeals court upheld verdict for
insurer of driver who committed suicide by driving her car into a truck.
Since the event was not an accident, the policy did not apply to the losses
suffered by the other driver's insurance company. (Updated September 1, 1999) |
|
Involuntary Manslaughter Is Felony That Precludes
Health Insurance Benefits
Briefed Case |
Court held in favor of insurer that denied health
benefits to insured who was injured when, driving drunk, he killed another
driver and was convicted of involuntary manslaughter. A policy provision
that excludes benefits in case of voluntary participation in a felony applies. (Updated June 1, 1999) |
|
Alcohol Exclusion for Death Benefit Only Applies
at Time of Death
Briefed Case |
Appeals court held that insurer must pay death
benefits to beneficiaries of policy that excluded benefits if death occurred
when insured was legally drunk. Insured died nine days after he caused an
accident by drunk driving. While drunk when in the accident, he was not
when he died. (Updated May 1, 1999) |
|
Sleeping in Camper on Pickup Truck Not Use of a
Motor Vehicle
Briefed Case |
Michigan high court upheld lower court verdicts
in favor of insurer, that refused to pay PIP benefits to insured who suffered
injury from a defective heater when sleeping in a camper on his pickup.
Vehicle was not in use as a motor vehicle, so coverage did not apply. (Updated May 1, 1999) |
|
Tenants Not Liable to Insurer for Fire Due to Their
Negligence
Briefed Case |
Massachusetts high court held that
a fire insurer had no subrogation claim against tenants for negligently
causing a fire that resulted in payment for fire loss to landlord. Lease
did not establish tenant liability, so insurer has no claim. (Updated April 1, 1999) |
|
Policyholders To Be Paid Replacement Cost Upon Incurring
Debt for Reconstruction
Briefed Case |
Insurer would not pay homeowner full replacement
cost until the reconstruction on their fire-damaged home was completed.
Court ordered insureds to be paid the replacement cost up front, once they
incurred a valid debt to have their home repaired. (Updated April 1, 1999) |
|
Drunk Driver's Death Not "Accidental" So Policy
Benefits Denied
Briefed Case |
A drunk driver knew or should have known that
injury or death was a possible consequence of driving drunk. Hence, an ERISA
accidental death policy did not pay benefits to the beneficiary of an insured
who was killed when, while legally intoxicated, he ran his car into a building
(Updated March 1, 1999) |
|
Multi-Year Lapse Before Filing Disqualifies Injury
Claim
Briefed Case |
Doctor forced to quit practice due to psychiatric
problem filed for injury benefits after his illness benefits expired. Appeals
court upheld denial of disability benefits for injury because the notice
requirements of the policy had been violated by many years. (Updated March 1, 1999) |
|
Student Walking to Board Bus Covered By Its Uninsured
Motorist Insurance
Briefed Case |
An uninsured motorist struck a student who was
walking to board a stopped school bus. Court held that this constituted
use of the vehicle, so the uninsured motorist insurance of the bus covered
the student. (Updated March 1, 1999) |
|
The Term "Accident" to Be Construed in Favor of
Insured
Briefed Case |
Florida high court upheld ruling in favor of
insured building contractor who sued insurer for coverage of losses incurred
when builder accidentally built a house over the set-back line. Accident
includes events not expected or intended. (Updated January 1, 1999) |
|
Marine Insurance Rescission Allowed Due to Concealment
of Loss History
Briefed Case |
Due to concealment, appeals court upheld rescission
of marine insurance issued for yacht that sank on maiden voyage. Yacht was
purchased by company owned by person who had long history of unrevealed
yacht losses and multiple other insurance claims. (Updated January 1, 1999) |
|
Law When Policy Issued Governs Later Claim
Briefed Case |
Insured, injured in accident, invoked
underinsured motorist coverage in her policy to cover damages. Ohio high
court held that the law at the time her policy was made formed a binding
contract that was not altered by later changes in insurance statutes. (Updated October 19, 1998) |
|
Misrepresentation, Not Misstatement, Grounds for
Policy Rescission
Briefed Case |
Policy holder placed in nursing
care for Alzheimer's six months after she received a policy. Policy holder
was due trial to determine if her misstatement that she had not been hospitalized
or diagnosed for anything other than high blood pressure were misrepresentations
or were innocent so that the policy could not be rescinded. (Updated October 19, 1998) |
|
Uninsured Motorist Coverage Applies to Victim of
Intentional Tort with a Vehicle
Briefed Case |
Party with no-fault insurance was
injured in his vehicle in an assault by an uninsured motorist using a vehicle.
Court held that uninsured motorist coverage would apply despite the intentional
tort because of the liberal coverage of no-fault insurance. (Updated October 19, 1998) |
|
Take Your Victims as You Find Them for PIP Benefits
Briefed Case |
Trial court properly allowed application
of "thin skull" doctrine, that tortfeasors take their victims as they find
them, in case of breach of PIP benefits by insurance company. As in tort,
the extent of damages are unforeseeable in the PIP contract. (Updated May 29, 1998) |
|
Sterile Bull Not Covered Property Damage Despite
Disappointed Heifers
Briefed Case |
Dairy herd owner incurred economic
losses due to purchase of breeding bull that turned out to be sterile. Bull
seller's liability policy did not apply because sterility is not an accident
and economic loss to the dairy was not property damage. (Updated May 29, 1998) |
|
Car Rental Company Stands First in Line for Liability
Responsibility
Briefed Case |
Driver of rental car at fault in
accident, who did not buy insurance from rental agency, was required by
rental contract to look to his personal auto insurer for liability coverage.
Minnesota high court held that under statute and common law, rental company
stands first in responsibility. (Updated May 29, 1998) |
|
Insurer Has Good Faith Duty to Minimize Insured's
Liability Briefed Case
|
Insurance company demanded release
of all claims and subrogation rights in drunk driving accident in which
it was clear its client was at fault. Failure to settle in such circumstances
could well be bad faith, an issue for the jury. (Updated May 29, 1998) |
|
Ambiguous Policy Terms Construed To Favor Insured
Briefed Case |
Medical expenses of live-in housekeeper
injured in house fire denied by insurer. Court held that since the two conditions
in the policy of live-in employees covered were inconsistent and ambiguous
that, as usual, the policy would be interpreted so as to favor the insured.
(Updated 4-6-98) |
|
Auto Insurance Benefits May Be Reduced By Amount
of Workers' Compensation Benefits
Briefed Case |
North Carolina law allows an offset
to auto insurance policies covering uninsured motorists by sums received
from workers' compensation benefits that arose from the same incident. (Updated 3-11-98) |
|
Bad Faith Claim Against Insurer Barred When Insurer
Paid Judgment Against Insured
Briefed Case |
Customer sued business for personal
injury and business owner's insurance company for bad faith for not attempting
to settle her claim. District court decision to dismiss case against insurance
company because it paid the judgment won in the action against insured upheld
by Florida high court. (Updated 2-3-98) |
|
Right to Convert Policy Does Not Continue Coverage
Briefed Case |
Former employee killed less than
a month after leaving employment. His life insurance policy had a right
of conversion within 31 days of leaving employment. Because he had not elected
to convert to a personal policy, there was no coverage in effect during
the conversion period. (Updated 12-29-97) |
|
Mail Box Rule Applied to Insurance Policy Acceptance
Briefed Case
|
Insurance policy holder's mailing
of renewal premium two days before policy expiration held to form a contract
under the mail box rule even though the renewal notice, which policy holder
lost, stated that renewal was not effective until payment was received.
(Updated 11-14-97) |
©1997-2008 SW Legal Studies in Business. All Rights Reserved.