Ashlyn M. Capote, Author at The Insurance & Reinsurance Report

April 2, 2020 Extra-Contractual

Northern District of New York Grants 12(b)(6) Motion Dismissing Extra-Contractual Damages

On March 30, 2020, Judge Lawrence E. Kahn of the Northern District of New York granted a carrier’s 12(b)(6) motion seeking dismissal of the insured’s extra-contractual claims. The case was filed by a homeowner seeking payment for alleged water damages at her home. She alleged that the water damage loss occurred January 6, 2017, but acknowledged that she had not reported the claim until a year later.

Plaintiff alleged that the carrier wrongfully denied her claim, although the carrier pointed out that it never actually …

February 20, 2020 Punitive Damages

No Liability Coverage for Vicariously Liable Punitive Damages in Florida

The Southern District of Florida issued a ruling favorable to insurers in interpreting whether punitive damages are insurable in Florida–even when awarded for vicariously liable acts.

The case, Ranger Constr. Indus., Inc. v. Allied World Nat’l Assurance Co., No. 17-81226-KAM (S.D. Fla. Dec. 23, 2019), was an insurance coverage dispute arising over an excess policy issued by Allied World to the plaintiff. The policyholder had been hired for a construction project involving building a highway, and various subcontractors were ultimately hired. One such subcontractor’s …

December 4, 2019 Bad Faith and Extra-Contractual Liability

Venue Matters: Evaluating the Applicable Standard for Bad Faith Claims in New York

The insurance market has a strong interest in minimizing extra-contractual claims against it. These issues are often decided summarily at the pre-answer motion to dismiss stage or after discovery on summary judgment. Notably, however, since 2018, New York courts have articulated varying standards in evaluating a policyholder’s claim for breach of the implied covenant of good faith seeking consequential damages against its insurer in the context of these motions.

Insurers have traditionally defended themselves against these extra-contractual claims by advancing two main arguments:

They are

November 5, 2019 General / Uncategorized

New York Courts Continue to Differ on Interpretation of Primary and Noncontributory Clauses

Most insurance professionals encounter additional insured coverage issues on a daily basis, and priority of coverage is sometimes part of an additional insured analysis. Policies issued by insurance carriers contain primary and noncontributory language on an increasing basis, and that language is sometimes located within a separate endorsement or may be part of the additional insured endorsement. Generally speaking, a primary and noncontributory provision modifies the policy’s other insurance provision to specify that coverage provided under the policy to an additional insured will be excess …

July 17, 2019 Uncategorized

Second Circuit Finds Insurer’s 52-Day Delay in Disclaiming Coverage Did Not Violate Insurance Law Section 3420(d)(2)’s Timely Disclaimer Requirement

The court of appeals for the Second Circuit recently confirmed that a liability insurer that waits to deny coverage so that it can investigate the facts giving rise to the disclaimer will not be estopped from denying coverage under Insurance Law Section 3420(d)(2), provided that the insurer does not use the investigation as a tactic to delay the disclaimer. United Fin. Cas. Co. v. Country-Wide Ins. Co., No. 18-3022, 2019 WL 2724267 (2d Cir. July 1, 2019).

Section 3420(d)(2) requires that for liability …

April 16, 2019 Duty to Defend

The Evolving Impact of Burlington v. NYC Transit: In New York, is Proximate Causation Necessary to Trigger the Duty to Defend an Additional Insured?

In previous blog posts this year, and to keep up with how courts are interpreting the New York Court of Appeals 2017 decision in Burlington Ins. Co. v. NYC Transit Auth., 29 N.Y.3d 313 (2017), we discussed the trial court’s decision in M & M Realty of New York, LLC v. Burlington Ins. Co. and the First Department’s reversal in the same case. Recently, a New York Supreme Court Judge decided American Empire Surplus Lines Ins. Co. v. Arch Specialty Ins., No. 655234/2018, …

March 15, 2019 General

Injured Employee Triggers Additional Insured Coverage

While awaiting the Appellate Division’s decision in M & M Realty of New York LLC v. Burlington Ins. Co., No. 153949/16, 2019 WL 1028971 (1st Dept. Mar. 5, 2019), we discussed the New York Supreme Court decision in a post in January. Last week the first department finally weighed in.

Recall that the coverage dispute arises out of an underlying bodily injury case to an employee of L&M, which was hired by owner M&M to work on a project. M&M sought additional insured coverage …

January 18, 2019 Other Insurance

The Duty to Defend Additional Insureds in Post-Burlington New York

Anyone with a connection to the insurance coverage world in New York knows about the New York Court of Appeals 2017 decision in Burlington Ins. Co. v. NYC Transit Auth., 29 N.Y.3d 313 (2017), which held that “where an insurance policy is restricted to liability for any bodily injury ‘caused, in whole or in part’ by the ‘acts or omissions’ of the named insured, the coverage applies to injury approximately caused by the named insured.” At the time the decision was rendered, it was …