Category: Emerging Issues

Emerging Issues

California Supreme Court Authorizes UCL Lawsuits Against Insurers

Yanting Zhang v. California Capital Insurance Company

In a decision by the state’s highest court, the California Supreme Court harmonized years of split opinions among California courts regarding the inability to bring a private action under the Unfair Insurance Practices Act (UIPA).  The inability to do so arose out of a 1988 decision by the same court, which stated that UIPA never intended to create a private cause of action for commission of the unfair practices listed therein. Moradi-Shalal v. Fireman’s Fund Ins. Co., …

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Emerging Issues

Insurer Owes Coverage After Longshoreman Drops Lathe

Amera-Seiki Corp. v. The Cincinnati Ins. Co., United States Court of Appeals for the Eighth Circuit, July 23, 2013
The Eighth Circuit Court of Appeals found that The Cincinnati Insurance Company owed coverage to its insured for equipment that was destroyed at port terminal based on ambiguous policy language. The Cincinnati Insurance Company insured a machine tool supplier, Amera-Seiki Corp., under a commercial property policy. During the policy period, Amera-Seiki purchased a vertical lathe from Taiwan for delivery to a customer in Illinois. The …

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Emerging Issues

U.K. Court Puts Insurer to Bed Over Blanket Notification

McManus Seddon Runhams v European Risk Insurance Company, [2013] EWHC 18 (Ch) 

A recent United Kingdom decision from the High Court of Justice held blanket notifications valid to claim coverage under a professional indemnity insurance (PII) policy. The case provides helpful guidance to law firms with PII on what constitutes a valid notification of circumstance under a PII policy.

In October 2010, the law firm of McManus Seddon Runhams (McManus) acquired Sekhon Firth (Sekhon). By May 2012, McManus discovered 17 breach of fiduciary duty …

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Emerging Issues

New Connecticut Law Allows Disaster Mediation Program for Property Insurance Claims

On June 21, Connecticut Governor Dannel Malloy signed into law Substitute House Bill No. 6549, Public Act No. 13-148, which allows the Connecticut State Insurance Department to set up a mediation program for insurance claims arising from a catastrophic event. The bill will allow for a program which permits policyholders to mediate property insurance claims which arise out of a catastrophic event, if the catastrophic event gives rise to a declared state of emergency.

The law follows was designed after to promote efficiencies in …

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Emerging Issues

New York Addresses Cyber Security Concerns with Insurers

Governor Andrew M. Cuomo launched an inquiry into the steps that insurers are taking to keep their customers and companies safe from cyber attacks citing the public entrustment of a wide variety of sensitive health, personal, and financial records to insurers and the critical importance of making sure that information is safeguarded.

The New York State Department of Financial Services (DFS) sent “308 Letters” requiring a response to the largest insurance companies that DFS regulates, requesting information on the policies and procedures they have in …

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Emerging Issues

IRS Deals Another Blow to Businesses, Says Wellness Programs Won’t Qualify under ACA

The IRS released proposed new rules which will curb most employer initiated wellness programs from qualifying towards the minimum value for the coverage employers are expected to offer every full-time employee. The wellness programs were said to be discriminatory, due to incentives that not all employees could qualify for which would mean charging more for those who did not qualify under the wellness program for added benefits. Labor unions and employee advocacy groups resisted the wellness programs on this account, urging for the all pay …

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Emerging Issues

New Kid on the Block

It’s tough to be the new kid on the block as the Federal Insurance Office (FIO) is quickly finding out. FIO Director Michael McRaith had an idea and it wasn’t like the idea was bizarre or anything. Simply put – there appears to be a question, if not a problem, with life insurers using special purpose vehicles and captives to offload insurance reserves. The Federal Advisory Committee on Insurance should set up a task force to investigate. This is important enough that the U.S. Treasury …

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Emerging Issues

Insurer on “Hook” for Insured’s Costs in Responding Investigation Subpoenas

Syracuse Univ. v. Nat’l Union Fire Ins. Co.  N.Y.  Sup. Ct., March 7, 2013


Syracuse University, as the named insured under the policy, sought coverage for the costs it incurred in responding to the state and federal investigative subpoenas relating to the allegations of sexual abuse by Bernie Fine, the former University’s Associate Basketball Coach.

The insuring agreement provided that the insurer shall pay for “loss arising from a claim … for any actual or alleged wrongful act of the organization” and defined claim …

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Emerging Issues

“Would You Like to Register to Vote?” Should This Question Appear on ACA’s New Federal Health Insurance Application?

Yesterday, Charles W. Boustany, JR, MD, the Chairman of the House Committee on Ways and Means Subcommittee on Oversight wrote to the Honorable Kathleen Sebelius, Secretary of the Department of Health and Human Services (Dept. of HHS), inquiring about the draft application for health insurance under the new health care law, the Affordable Care Act (ACA). Specifically, the letter calls into question the application where it asks, “Would you like to register to vote?”

The online application is 61 pages long and applies …

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Emerging Issues

First List of Non-Bank Systemically Important Financial Institutions Due Out Soon

U.S. Treasury Under Secretary for Domestic Finance Mary J. Miller recently announced that the first final list of non-bank Systemically Important Financial Institutions (SIFI) is going to be released soon. See Property Casualty for more details.  This list will include insurance companies.  Miller said she hoped the Financial Stability Oversight Council (FSOC) headed by new Treasury Secretary, Jacob Lew, would vote on the list in the next several months. The FSOC and SIFI designation were critical components of the Dodd-Frank reform act.

In April 2012, …

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