A federal court recently held that an insurer may deny coverage under a homeowner’s policy for a “residence premises” when the insured never actually lived at the premises. In Sina Davani v. Travelers Personal Insurance Company and Geico Insurance Agency, LLC, Case No. 22-1244 (D. Kan. October 26, 2023), the District of Kansas granted defendant-insurer’s motion for summary judgment holding that the plaintiff-insured never resided at the insured premises and residence in the context of an insurance contract requires an insured’s physical presence at a certain location and an intent to remain at the location for an indefinite period of time. About The Author
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There’s No Place Like Home! Kansas Federal Court Holds Homeowner’s Policy Coverage Requires Policyholder to Physically Reside at Residence
Tagged with: Coverage, Homeowner’s Insurance, Primary Residence, property damage, property insurance
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Southern District of Texas Holds that Appraisal Award is Inconclusive of Whether a Loss is Covered
The Southern District of Texas recently held that an appraisal award did not establish liability for a covered loss under the policy. In Hoff v. Meridian Sec. Ins. Co., 2023 WL 5192013 (S.D. Tex. Aug. 11, 2023), Meridian Security Insurance (“Meridian”) insured Flemming Hoff (“Hoff”). After filing suit, Hoff requested an appraisal pursuant to the following policy language: If you [Hoff] and we [Meridian] disagree on the amount of loss, either may demand an appraisal of the loss. In this event, each party will choose a competent and impartial appraiser within 20 days after receiving a written request from the other. The two appraisers will choose an umpire. If they cannot agree upon an umpire within 15 days, you or…
Tagged with: appraisal, claim investigation, claims handling, Coverage, damages, estimate, property damage, Texas
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Florida Enacts Broad Insurance Reforms Focusing on Bad Faith
From 2019 to 2022, the Florida Legislature enacted four separate property insurance reforms that sought to rein in abusive property insurance litigation fueled by one-way attorney’s fee shifting and an army of professional plaintiffs filing lawsuits pursuant to assignments of benefits. In its latest reform, the Legislature has shifted its focus to the broader insurance market and to tort reform. For many years now, Florida has significantly led the nation in tort costs per household. This metric has been driven by a high octane litigation environment, ever growing personal injury verdicts, and a gradually sharpened focus on setting up insurers for bad faith claims. About The Authors
Louisiana Supreme Court Reverses a Rare State Court of Appeals Win for COVID-19 Business Interruption Claimant
COVID-19 business interruption claimants have had few state appellate court decisions upon which to rely. Louisiana produced one such decision in Cajun Conti, LLC v. Certain Underwriters at Lloyd’s, 2022 La. App. LEXIS 939 (La. App. 4 Cir., June 15, 2022). The insurer prevailed in the trial court in a dispute over whether coronavirus constituted “direct physical loss of or damage to” insured property. The insured restaurant appealed. Louisiana’s Fourth Circuit Court of Appeal reversed the trial court. The Court of Appeal’s opinion became widely-cited by other COVID-19 business interruption claimants. The insurer appealed to the Louisiana Supreme Court and Cajun Conti became a widely-followed dispute. As discussed below, the Court of Appeal’s analysis was out of step with the…
Florida Begins New Era with Major Property Insurance Reforms
For the fourth time since 2019, the Florida Legislature has enacted property insurance reforms aimed towards stabilizing a beleaguered insurance market. The bill, S.B. 2-A, creates a reinsurance assistance program, establishes additional oversight for insurers with high volumes of hurricane claims, and reforms many aspects of the claims process, including the timing for paying and adjusting claims. The reforms further eliminate one-way attorney fee awards to policyholders and ban assignment-of-benefits agreements. In this article, we will focus on the changes to the claim adjustment process and coverage and bad faith litigation. About The Authors
Tagged with: 624.1551, 626.9373, 626.9541, 627.428, 627.70131, 627.70132, adjustment, attorney's fees, Bad Faith, Florida, H.B. 1-A, notice, property insurance, reform, S.B. 2-A
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Texas Court of Appeals Nixes Plaintiff’s Attorney’s Fees Award Because Offsets Preclude Prevailing Party Status
The First Court of Appeals in Houston affirmed an analysis that involved math and application of the Texas Insurance Code. In Jones v. Allstate Vehicle & Property Insurance Company, 2022 Tex. App. LEXIS 8896 (Tex. App.—Houston [1st Dist.] Dec. 6, 2022, no pet.), the policyholder appealed a take-nothing judgment in favor of the insurer in a dispute over a partial denial of a homeowners claim. The policyholder sued her insurer for breach of contract, violation of the Texas Insurance Code, and breach of the duty of good faith and fair dealing. At trial, the jury found that the insurer failed to comply with the policy, engaged in unfair and deceptive trade practices, and failed to comply with the duty of…
Fifth Circuit Resolves Split Over Chapter 542A Election of Liability for Agents
In Advanced Indicator & Manufacturing v. Acadia Insurance Company,[1] the Fifth Circuit resolved a thorny split in Texas federal district courts regarding Texas Insurance Code Chapter 542A by returning to a bedrock principle governing removal. Now as long as the insurer has elected to accept the adjuster’s liability any time before removal – even when after suit is filed – there is no possibility of recovery against the adjuster and removal will be proper. About The Author
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Oklahoma Supreme Court Rejects “Loss of Use” Argument, Nixes COVID-19 Business Interruption Suit
There is a clear nationwide trend of federal courts disposing of COVID-19 business interruption suits.[1] Insureds are not clearing their initial burden to establish direct physical loss or damage to property, or they are running afoul of virus and contamination exclusions. Relatively few state supreme courts, however, have weighed in to resolve the issue, thereby providing guidance to their own lower courts and federal courts that must follow state law.[2] Insurers and insureds alike have been watching to see which way the Oklahoma Supreme Court would hold. In Cherokee Nation v. Lexington Ins. Co., 2022 OK 71, the Court joined the national mainstream and ruled against the insured. About The Author
Tagged with: Cherokee, covid, damage, Insurance, interruption, Oklahoma, physical, policy, use
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Texas Court of Appeals Adds Confusion to Post-Appraisal Litigation Under the TPPCA
Ever since the Texas Supreme Court changed the landscape of Texas law regarding appraisal in Barbara Technologies Corp. v. State Farm Lloyds, 589 S.W.3d 806 (Tex. 2019) and Ortiz v. State Farm Lloyds, 589 S.W.3d 127 (Tex. 2019), practitioners and courts have been struggling to apply the Texas Supreme Court’s holdings. Barbara Technologies and Ortiz answered some questions but raised others. About The Authors
Tagged with: Attorney’s Fees, Bad Faith, Insurance, Prompt Payment, property, TCPPA, Texas
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Florida Appeals Court Reverses Appraisal Ordered In Storm Suit
On July 20, 2022, Florida’s Third District Court of Appeal reversed and remanded a trial court’s decision compelling the parties to proceed with appraisal and staying litigation until that appraisal was completed. Florida’s appellate court held that trial court erred in granting the motion to compel appraisal without first conducting an evidentiary hearing to determine compliance with post loss obligations. About The Authors
