Steven Plitt, Expert Witness Steven Plitt, Expert Witness
Insurance Bad Faith Claim Handling Expert Serving Clients Nationwide

March 2018 Archives

Oregon Court Upholds Suit Limitation Clause Where the Insurance Company Did Nothing to Prevent the Insureds From Suing in a Timely Fashion

In Brockway v. Allstate Property & Casualty Insurance Co., 284 Or. App. 83, 391 P.3d 871 (2017) the Oregon Court of Appeals upheld a suit limitation clause in Allstate's policy thereby upholding the dismissal of the insured's claim against Allstate. The Brockway case involved a first-party property homeowners claim in which the homeowners sought coverage for a hole that was cut into the insured's backyard fence and associated stolen personal property. During Allstate's investigation of the claim, the Brockways/homeowners asserted that they discovered additional losses from the fence episode. A year following the loss Allstate requested from the Brockways a sworn proof of loss and advised them regarding the statute of limitations on their claim as per the policy's suit limitation clause. Allstate also advised the Brockways that it had done nothing in the handling of their claim that could result in an estoppel or waiver of any coverage defense. In February 2012 Allstate denied coverage for the claim, asserting misrepresentation, noncooperation, and the passage of time. Thereafter the Brockways filed suit against Allstate. In the lawsuit the Brockways alleged that Allstate's continuing investigation estopped it from relying on the statute of limitations set forth in the policy suit limitation clause ("SLC").

Regular Use Exclusion Found To Apply To Borrowed Car According To The Maine Supreme Judicial Court

In Estate of Mason v. Amica Mutual Insurance Co., 158 A.3d 495 (2017) the Maine Supreme Judicial Court found that where a driver is authorized to use another's car as if it was her own, pending repair of her vehicle, the borrowed car was available for regular use and was governed by the insurance policy's regular use exclusion.

Rhode Island Supreme Court Finds That An Insured's Malpractice Claim Against His Former Insurance Agent Was Untimely Because It Was Filed More Than Three Years After The Insured Received A Copy Of The Policy And Therefore Could Have Discovered The Alleged

In Faber v. McVay, 155 A.3d 153 (R.I. March 8, 2017) the Rhode Island Supreme Court held that an insurance agent malpractice claim was untimely because it was not filed within three years after the date upon which the plaintiff knew or should have known of the agent's alleged wrongful acts.

Additional Insured is not Entitled to Coverage Until Named Insured Satisfies Self-Insured Retention

In a case of first impression under Indiana law, the Indiana Court of Appeals in Walsh Construction Co. v. Zurich, 72 N.E.3d 957 (Ind. App. 2017) held that a policy's SIR had to be exhausted by the named insured before the insurance company was obligated to defend and indemnify the additional insured under the policy. This case involved a construction site accident. The named insured, Roadsafe Holdings, Inc., was a subcontractor for the project and was required to indemnify the general contractor, Walsh Construction Company, for any liability resulting from Roadsafe's negligence. Under the subcontract, Roadsafe was obligated to procure general liability insurance that named Walsh as an additional insured on a primary and non-contributory basis. In accordance with the subcontract, Roadsafe obtained a CGL policy from Zurich which named Walsh as an AI. The AI endorsement was a blanket form of endorsement which established AI status for any person or organization where required by written contract, but only with respect to the liability for the named insured's (Roadsafe) acts or omissions. Roadsafe also purchased a $500,000 per occurrence SIR which required as an express condition precedent that the SIR be exhausted prior to Zurich having an obligation to defend and indemnify under the policy.

Michigan Court Finds Earth Movement Exclusion Applicable to Man-made Earth Movement

Typical earth movement exclusions reference "any" earth movement and are generally understood to be all-encompassing. Nevertheless, courts have disagreed on whether earth movement exclusions are limited to naturally occurring earth movement as opposed to man-made earth movement. The Michigan Court of Appeals in Home-owners Insurance Co. v. Andriacchi, 2017 WL 2491886 (Mich. App., filed June 8, 2017) recently held that the policy's earth movement exclusion encompassed man-made earth movement as well as naturally occurring earth movement. In reaching this conclusion the court looked to the plain wording of the exclusion. The Michigan Court of Appeals found that the word "any" used within the exclusion ("any earth movement (other than sinkhole collapse) such as an earthquake, landslide or earth shrinking, risking or shifting") was commonly understood to be an all-encompassing word meaning "every" or "all". Thus, the exclusion applied to every and all movement of the earth without restriction or distinction as to type (i.e., natur 

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