Mealey's Catastrophic Loss : Mealey's : Legal News & Analysis

Mealey's Catastrophic Loss

July 13, 2023
5th Circuit Certifies Question In Tornado Coverage Dispute To Texas High Court

NEW ORLEANS — The Fifth Circuit U.S. Court of Appeals on July 12 certified a question to the Texas Supreme Court in an insured’s lawsuit alleging that its insurer violated the Texas Prompt Payment of Claims Act (TPPCA), asking the state’s highest court whether an insurer’s payment of a full appraisal award for tornado damage plus any possible statutory interest bars the insured’s recovery of attorney fees.
July 13, 2023
Appraisal Not Permitted After Suit Is Filed, Alaska Federal Judge Says

ANCHORAGE, Alaska — An Alaska federal judge denied a motion to compel appraisal in a breach of contract and bad faith suit stemming from roof and water damage to an insured home because the policy’s appraisal provision states that appraisal cannot be invoked after a suit is filed.
July 12, 2023
Panel Affirms Denial To Add Punitive Damages In Suit Against Now-Insolvent Insurer

DAYTONA BEACH, Fla. — A Florida appellate court affirmed a lower court’s order denying a homeowner’s request to amend his complaint to add punitive damages in his breach of the duty of good faith and fair dealing suit against a now-insolvent insurer, finding that the homeowner failed to satisfy punitive damages requirements under Florida law regarding the “general business practice” related to the insurer’s alleged lack of standards for investigating claims.
July 12, 2023
Panel: Insured Faces ‘Solid Wall Of Precedent’ In Coronavirus Coverage Appeal

SAN FRANCISCO — A California appellate court affirmed a ruling in favor of a commercial property insurer in an Orange County restaurant owner insured’s breach of contract lawsuit arising from the coronavirus pandemic, finding that the insured “faces a solid ‘wall of precedent’ that holds that direct physical loss or damage requires physical alteration of the covered property.”
July 12, 2023
Insured Appeals Denial Of Leave To Amend Coronavirus Complaint

BALTIMORE — An insured notified a Maryland federal court that it is appealing the court’s denial of its motion for leave to file a second amended complaint to address the standard for physical loss that was provided by the Maryland Supreme Court in answer to a certified question in a coronavirus coverage dispute.
July 03, 2023
Panel Affirms Judgment For Insurer, Says Policy’s Fraud Terms Apply To Assignee

LAKELAND, Fla. — A Florida appellate court on June 30 affirmed a trial court’s order granting judgment for a homeowners insurer in a breach of contract suit filed against it by a roofer that replaced the homeowners’ hurricane-damaged roof, finding that though the roofer was an assignee of the insureds, it was subject to the policy’s fraud conditions.
June 30, 2023
Panel Reverses Ruling As To Collapse Claim, Affirms As To Hurricane Irma Claim

WEST PALM BEACH, Fla. — A Florida appeals panel held that insureds failed to satisfy their burden of showing hidden and unknown decay or insect damage to cause their ceiling collapse but met their burden of proof to support a jury’s verdict in their favor on their Hurricane Irma claim, reversing in part and affirming in part the insureds’ lawsuit against their homeowners insurer.
June 29, 2023
Panel Reverses Ruling In Assignee’s Suit Seeking $3,500 For Engineering Report

WEST PALM BEACH, Fla. — A Florida appellate court panel on June 28 held that a lower court erred in denying an insurer’s motion for a directed verdict and giving an incorrect jury verdict form in a coverage dispute over a $3,500 engineering report, reversing and remanding with directions to enter a verdict in favor of the insurer.
June 28, 2023
Florida Panel Reverses Ruling In Insurer’s Favor In Hurricane Irma Coverage Dispute

WEST PALM BEACH, Fla. — A Florida appeals court panel concluded that a lower court erred in relying on a “deficient” affidavit of an insurer’s corporate representative in granting final summary judgment in favor of the insurer in a Hurricane Irma coverage dispute, reversing the ruling and remanding.
June 28, 2023
Panel: Fact Issue Exists As To Whether Insured Gave Prompt Notice Of Irma Loss

MIAMI — A Florida appeals panel concluded that a genuine issue of disputed fact remains regarding whether an insured gave prompt notice of her Hurricane Irma loss, reversing a lower court’s grant of summary judgment in favor of the insurer and remanding for further proceedings.
June 28, 2023
Panel Rejects Insureds’ Contention That Loss Of Full Use Of Restaurants Is Covered

PHOENIX — The Ninth Circuit U.S. Court of Appeals predicted that the Arizona Supreme Court would follow the courts’ “overwhelming consensus” that an insured’s temporary loss of use of property is not covered by an insurance policy’s provision for “direct physical loss of or damage to property,” affirming a lower federal court’s dismissal of restaurant owner insureds’ breach of contract lawsuit seeking coverage for their business losses and extra expenses arising from the governmental regulations in response to the coronavirus pandemic.
June 27, 2023
Insurer Seeks Rehearing Of Dismissal Of Its Appeal In Hurricane Irma Dispute

ATLANTA — An insurer filed a petition for rehearing en banc challenging a majority of the 11th Circuit U.S. Court of Appeals’ dismissal of its appeal in a Hurricane Irma coverage dispute for lack of appellate jurisdiction, challenging the majority’s finding that a lower federal court’s order compelling appraisal and staying a Hurricane Irma coverage dispute pending the appraisal is an interlocutory order that is not immediately appealable under 28 U.S. Code Section 1292(a)(1), 28 U.S.C. § 1292(a)(1), or under the Federal Arbitration Act.
June 27, 2023
Insureds Appeal California Court’s Ruling In Insurer’s Favor In COVID-19 Dispute

LOS ANGELES — Insureds filed a notice appealing a Los Angeles County Superior Court’s judgment on a jury’s special verdict in favor of a commercial property insurer in a breach of contract coverage lawsuit arising from the coronavirus pandemic, challenging the jury’s finding that SARS-CoV-2 did not cause any direct physical loss or damage to the insureds’ hotel on or before June 1, 2020.
June 26, 2023
Panel Will Not Give Insurer ‘Another Bite At The Apple’ In Irma Coverage Dispute

ATLANTA — The 11th Circuit U.S. Court of Appeals concluded on June 23 that without expert testimony as to what a professional captain would have done differently to avoid harm to an insured’s yacht during Hurricane Irma, a jury would have had to speculate to rule for the insurer under Florida's anti-technical statute, affirming a summary judgment ruling in favor of the insured in a coverage dispute that is before the 11th Circuit for the second time.
June 26, 2023
Texas High Court Refuses To Review Ruling In Hurricane Harvey Coverage Dispute

AUSTIN, Texas —The Texas Supreme Court on June 23 denied a commercial property insurer’s petition to review an appeals court’s finding that a policy’s $4.5 million flood endorsement does not control the amount of coverage available for a nursing and assisted-living facility’s business income and extra expense losses resulting from Hurricane Harvey.
June 26, 2023
Magistrate Denies Insured’s Motion To Compel Appraisal Of Hurricane Sally Damage

MOBILE, Ala. — A federal magistrate judge in Alabama denied an insured’s motion to compel appraisal in a coverage lawsuit over Hurricane Sally damage to its 10 four-story residential condominium buildings in Gulf Shores, Ala., finding that appraisal is not appropriate at this time because the parties' dispute involves the cause of the insured’s loss and not just the amount of loss.
June 23, 2023
Insured Seeks Coverage For $14M In Losses Resulting From ‘COVID-19 Manifestations’

NEW YORK — The holding company for the U.S. interests of the Mandarin Oriental Hotel Group sued its “all risk” commercial insurers in a New York federal court, arguing that the “Special Perils Provision” in an endorsement of the policies provided coverage for its $14 million in business interruption/interference losses caused by infectious or contagious diseases that were “manifested by any person within a 5-mile radius of” its four hotels in Boston, New York, Miami and Washington, D.C.
June 23, 2023
Panel: Restaurants Allege Communicable Disease Event, Direct Physical Loss, Damage

LOS ANGELES — A California appeals panel held June 22 that restaurant insureds sufficiently asserted the existence of a covered communicable disease event and direct physical loss or damage under their property insurance policy, reversing a lower court’s judgment against the insureds in their breach of contract and bad faith coverage lawsuit arising from the COVID-19 pandemic.
June 23, 2023
Court Erred In Compelling Arbitration Of $7M Hurricane Ida Suit, 5th Circuit Told

NEW ORLEANS — An insured tells the Fifth Circuit U.S. Court of Appeals in its appellant brief that a Louisiana federal court erred by compelling arbitration of a dispute over its claims for $7 million in damages caused by Hurricane Ida and for bad faith against its foreign and domestic insurers, arguing that its domestic insurers cannot circumvent an anti-arbitration clause under Louisiana law.
June 20, 2023
Condo Association Moves To Substitute FIGA For Insolvent Insurer In Coverage Row

BRADENTON, Fla. — A condominium association that sued its now-insolvent insurer for breach of contract in a Florida court for refusal to pay all alleged storm-related losses moved to substitute the Florida Insurance Guaranty Association (FIGA) for the insurer, asserting that FIGA is “obligated for the covered claim” because it arose before the insurer’s adjudication of insolvency.
June 20, 2023
Magistrate: Insured’s Discovery Approach In Irma Suit ‘Resembles A Shotgun Blast’

FORT MYERS, Fla. —A federal magistrate judge in Florida denied a condominium insured’s motion to compel discovery in a bad faith lawsuit seeking coverage for property damage caused by Hurricane Irma, finding that the insured’s broad discovery requests “necessarily capture a host of documents that would have little to no relevance” and its approach “resembles a shotgun blast,” which is not what Federal Rule of Civil Procedure 26 envisions.
June 19, 2023
Panel: Fact Issue Exists As To Whether Full Policy Limit Applied In Hurricane Suit

ATLANTA — A Georgia appeals court held June 16 that genuine issues of fact remain regarding whether a commercial property insurance policy provided wind-driven rain coverage up to the full policy limit, partly reversing a lower court’s ruling in a coverage dispute over Hurricane Florence damage to a DoubleTree hotel.
June 16, 2023
Judge: Insureds Not Entitled To Additional Benefits In Colorado Wildfire Dispute

DENVER — A federal judge in Colorado found that insureds failed to demonstrate a genuine issue of fact regarding their entitlement to additional benefits under a homeowners insurance policy, granting the insurer’s motion for summary judgment in the insureds’ breach of contract and bad faith coverage lawsuit arising from damage caused by the East Troublesome Fire.
June 15, 2023
Majority Vacates Insurer’s Motion To Invoke Appraisal In Hurricane Matthew Suit

TALLAHASSEE, Fla. — A majority of a Florida appeals court on June 14 vacated a lower court’s order granting an insurer’s motion to invoke appraisal and abate litigation of a Hurricane Matthew coverage dispute and remanded for further proceedings, finding that the insurer’s participation in litigation was inconsistent with its right to an appraisal.
June 14, 2023
N.J. Panel Affirms Ruling In Insurers’ Favor In Coronavirus Coverage Suit

TRENTON, N.J. — A New Jersey appeals court on June 13 affirmed a lower court’s grant of summary judgment in favor of primary and excess insurers in insureds’ lawsuit seeking coverage for its business losses arising from governmental orders closing the operation of their boardwalk amusement and entertainment businesses in response to the coronavirus, finding that the insureds did not satisfy the coverage prerequisite that they incurred “direct physical loss or damage” to their property and coverage is separately barred under the policies' pollution/contamination exclusion.