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

October 2019 Archives

INSUREDS ARE REQUIRED TO READ THE INSURANCE POLICY UNDER ARKANSAS LAW

The 8th Circuit Court of Appeals in Hatcher v. MDOW Insurance Co., 903 F.3d 724 (8th Cir. 2018) interpreting Arkansas law held the insurance company which had provided its homeowner insured with multiple policy renewal letters advising the insured to review the policy, satisfied its notice obligations regarding the contents of the policy, including all endorsements to the policy even though they were not directly referenced in the renewal letter. Under Arkansas law, written notices of renewal satisfy an insurer's notice obligations. See Arkansas Code Ann. §23-88-105.

UNINSURED MOTORIST SETTLEMENT DOES NOT REQUIRE PAYMENT OF INTEREST UNDER COLORADO LAW

The Colorado Supreme Court in Munoz v. American Family Mutual Insurance Co., 425 P.3d 1128 (Colo. 2018) rejected an insured's claim for prejudgment interest on an uninsured motorist settlement. In rejecting the prejudgment interest the Colorado Court looked at Colorado Revised Statute §13-21-101 which provides that a party is entitled to prejudgment interest where (1) a lawsuit is brought, (2) damages are claimed, (3) a damages award is received, and (4) judgment is entered. In the context of this case, the insured never filed an action against the uninsured motorist, never sought or received damages, and did not recover a judgment. Because of this, the Court found that the statute was inapplicable. The Court noted that the outcome was consistent with the nature of UM coverage, which was to put the insured in the same position as if the tortfeasor had been insured. If the insured had received a settlement from the third-party carrier, the insured would not have been entitled to prejudgment interest on the settlement amount. For the same reason, the Court found that American Family agreed to pay a settlement based on the tortfeasor's wrongdoing and that the insured was not entitled to prejudgment interest simply because the payor was his own insurance company.

TEXAS COURT OF APPEALS FINDS THAT INSURANCE COMPANY'S PAYING TIMELY TENDER OF FULL AMOUNT OF APPRAISAL AWARD PREVENTED INSURED'S RECOVERY UNDER TEXAS' PROMPT PAYMENT OF CLAIMS STATUTE

In Marchbanks v. Liberty Ins. Corp., 558 S.W.3d 308 (Tex. App. 2018), the Texas Court of Appeals held that insureds could not recover for violations of Texas' Prompt Payment of Claims Act (Tex. Ins. Co. Ann. §542.051 et seq. (West 2013) for any type of underpayment of a claim in cases where the appraisal process was invoked at any time, even after a lawsuit had been filed, and the insurer made timely payment in accordance with the appraisal award.

OHIO COURT FINDS THAT PHYSICIAN'S SEXUAL RELATIONSHIP WITH A PATIENT DID NOT CONSTITUTE MEDICAL MALPRACTICE

In Beattie v. McCoy, 2018-Ohio-2535, 115 N.E.3d 867, the Court held that professional liability policies did not cover medical malpractice actions arising from a physician's sexual relationship with a patient. The policy in question provided coverage for defined "professional services." The policy defined "professional services" as "medical, surgical, dental, imaging, mental or other healthcare professional service or treatments . . . [and the] provision of drugs, healthcare supplies or appliances." Under the facts presented there was no obligation to provide coverage.

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