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

Posts tagged "policy limits"

The 11th Circuit Court Of Appeals, Interpreting Georgia Law, Recently Enforced A UIM Excess Policy Exhaustion Requirement In Disallowing A UIM Claim

The 11th Circuit held in Coker v. American Guarantee and Liability Insurance Co., 825 F.3d 1287 (11th Cir. 2016), interpreting Georgia law, that Georgia's UIM statute did not transform excess UIM policies into primary UIM policies.

Timely Offering Policy Limits Does Not Immunize Insurer From Bad Faith Exposure

The California Supreme Court in Barickman v. Mercury Casualty Co., 2 Cal. App. 5th 508 (2nd Dist. 2016) held that the insurance carrier was liable for bad faith failure to settle, notwithstanding the fact that the carrier offered its policy limits to the claimants in a timely manner in exchange for a full release of civil liability. The court found that the insurer's failure to do "all within its power to effect a settlement" could constitute bad faith, notwithstanding the fact that the insurance company offered its policy limits to the injured claimants in exchange for a full release of liability. The insurance company had refused to consent to additional language in the release designed to preserve the claimant's rights to receive criminal restitution from the insured tortfeasor.

MISSOURI HIGH COURT CALCULATES UIM ATTACHMENT POINT

The Missouri Supreme Court in Swadley v. Shelter Mutual Insurance Co., 513 S.W.3d 355 (Mo. 2017) held that UIM coverage did not apply when the underinsured motorist had liability coverage limits greater than the insured's underinsured motorist limits. Previously, the Missouri Court of Appeals had explained the purpose of UIM coverage. "The purpose of underinsured motorist coverage is to provide insurance coverage for insureds who have been bodily injured by a negligent motorist whose own automobile liability insurance coverage is insufficient to pay for the injured person's actual damages." Wasson v. Shelter Mutual Insurance Co., 358 S.W. 3d 113, 117 (Mo. App. 2011).

MISSISSIPPI SUPREME COURT FINDS THAT LOSS OF CONSORTIUM CLAIMS ARE PART OF THE PER PERSON LIMITS FOR UIM COVERAGE

The Mississippi Supreme Court in Rylee v. Progressive Gulf Insurance Co., 2017 WL 949545 (Miss. Mar. 9, 2017) found that a UIM policy's "each person" limit applied not only to a husband's bodily injury claim, but also to the wife's loss of consortium claim, i.e., loss of consortium claims are part of the "each person" limit and are not afforded a separate "each person" limit. The court noted that on two separate prior occasions, the court had interpreted similar policy language and reached the same conclusion that to recover more than the "each person" limit for one person, there must be more than one person who sustained bodily injury during the accident. Citing State Farm Mutual Auto Insurance Co. v. Acosta, 479 S.2d 1089, 1090‑91 (1985) and Old Sec. Cas. Insurance v. Clemmer, 455 S.2d 781, 782 (Miss. 1984). Because the wife in the case at bar was not with her husband during the crash, her husband was the only person who sustained bodily injury in the accident. Therefore, the wife's loss of consortium claim fell under the "each person" policy limit available to the husband. The court also noted that the 5th Circuit Court of Appeals relied upon the Acosta decision when it rejected a similar claim. See, Reed v. State Farm Mutual Insurance, 784 F.2d 577, 578-79 (5th Cir. 1986).

THE IDAHO SUPREME COURT REFUSES TO ENFORCE UIM POLICY ANTI-STACKING PROVISIONS

The Idaho Supreme Court in Gearhart v. Mutual of Enumclaw Ins. Co., 160 Idaho 666, 378 P.3d 454 (Idaho 2016), found that a UIM anti-stacking provision was ambiguous and, therefore, unenforceable. In Gearhart, the Court considered a UIM policy's anti-stacking clause which stated that the maximum limit of liability under all of the policies that were issued was the highest applicable limit under any one policy. However, the Court found this clause to be ambiguous and, therefore, did not preclude a passenger from recovering the total cumulative UIM benefits under each policy issued to the insured's parents. The majority opinion concluded that the anti-stacking clause in question was ambiguous because it could be construed to "mean that one aggregates all of the applicable policy limits and then the total of the limits constitutes the highest limit of any one policy." The dissent characterized the majority's conclusion as "nonsensical." The dissent would have found the anti-stacking clause to be neither ambiguous nor complex.

INSURANCE COMPANIES HAGGLING OVER RELEASE LANGUAGE CAN RESULT IN BAD FAITH LIABILITY

In Barickman v. Mercury Cas. Co., 2 Cal.App.5th 508, 206 Cal.Rptr.3d 699 (2d Dist. 2016), an insurance company's refusal to consent to additional release language which was designed to preserve the claimant's rights to receive criminal restitution from the insured tortfeasor caused the case not to settle and, as a result, it was found that the insurance company breached the implied covenant of good faith and fair dealing by not doing all that it could do within its power to effectuate the settlement.

In A Surprising Decision, A Federal District Court, Applying Florida Law, Granted Summary Judgment To An Insurance Company On A "Failure To Settle" Claim Because The Insured's Liability Was Not Clear

Florida is a testing ground for creative lawyering designed to set up insurance companies on failure to settle claims. However, in Welford v. Liberty Ins. Corp., 2016 WL 3360431 (N.D. Fla., 6/2/16), at least one Federal District Court refused to countenance yet another attorney's attempt to create a failure to settle claim against an insurance company under Florida law. In this case, the insurance company tendered its limits within two days after receiving the lawsuit. Nevertheless, the claimant argued that the insurance company had failed to promptly tender the limits earlier in the matter when it was first notified of the accident. The District Court found that no reasonable trier of fact could have determined that the insured's liability was "clear" when the claim was first reported. The facts before the Court were complicated and disputed.

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