Emerging Issues Archives - Page 5 of 18 - The Insurance & Reinsurance Report

February 4, 2015 Emerging Issues

Carriers With Mutually Repugnant Other Insurance Clauses Found To Contribute Pro-Rata To Underlying Defense

Certain Underwriters at Lloyds v. Waveblast Watersports, Inc.. 2015 U.S. Dist. LEXIS 4267, (S.D. Fla. Jan. 14, 2015). This declaratory judgment action stems from an underlying parasailing accident. Plaintiff sought a declaration that it had no duty to defend or indemnify under a policy it issued to defendant Waveblast as the named insured, and defendant Sands Harbor an additional insured. Defendant Scottsdale issued a policy to Sands Harbor as the named insured.

Scottsdale and Sands Harbor moved for Final Summary Judgment seeking a ruling that …

January 15, 2015 Emerging Issues

MetLife Files First Challenge to SIFI Designation

MetLife is challenging its designation as a nonbank systemically important financial institution (SIFI). Dodd-Frank created the Financial Stability Oversight Council (FSOC) which comprises the heads of federal financial regulators and a voting insurance specialist and is chaired by the Treasury Secretary. So far, three insurance companies, Prudential, AIG and MetLife, have received the nonbank SIFI designation. However, MetLife is the first to take advantage of the judicial review provision in Dodd-Frank.

Dodd-Frank provides that within 30 days of a final determination by the FSOC. A …

December 10, 2014 Emerging Issues

Where are You TRIA

Politicos and industry alike are echoing the sentiments of Cindy Lou Who when she sings “Where are you, Christmas?” in the popular movie “How the Grinch Stole Christmas” except in this case, the question is, “Where are you TRIA?”

As the current Terrorism Risk Insurance Act (TRIA) approaches its expiration date of December 31, 2014, there are questions swirling about whether it will ultimately be renewed and whether the levels and conditions of coverage will be so diluted as to have an immediate negative impact …

November 26, 2014 Emerging Issues

What’s in Your Breakfast Sanwich? The Eighth Circuit Weighs in on Accidental Product Contamination Policies and Voluntary Product Recalls

In Hot Stuff Foods, LLC v. Houston Casualty Co., 2014 U.S. App. LEXIS 21727 (8th Cir. Nov. 17, 2014), the Eighth Circuit Court of Appeals reversed and remanded a lower court decision holding that a food company’s voluntary recall was covered under an ‘accidental product contamination’ insurance policy.

Hot Stuff Foods manufactures two versions of sausage breakfast sandwiches – one that contains monosodium glutamate (MSG), and another that does not. In 2011, Hot Stuff found out it had inadvertently distributed sandwiches containing MSG using …

November 19, 2014 Emerging Issues

You Get What You Pay For: Title Insurers Need Only Defend Claims Explicitly Covered in Policy

On November 13, the Seventh Circuit Court of Appeals decided in a case of first impression that the “complete defense” rule does not apply to title insurers and overturned the Northern District of Illinois’s ruling in Philadelphia Indemnity Ins. Co. v. Chicago Title Ins. Co. that defendant Chicago Title could not limit the defense of its insured to claims that might arise under the subject title insurance policy.

In 2007, Western Capital Partners, LLC, a high-risk real estate lender, moved to foreclose on mortgaged commercial …

November 18, 2014 Emerging Issues

Oregon Federal District Court Rejects Coverage for Trademark Infringement Under Coverage B

In Crum & Forster Specialty Insurance Co, v. Willowood USA, LLC, et al., Civ. No. 6:13-cv-01923-MC, 2014 U.S. Dist. LEXIS 153363 (D. Or. Oct. 27, 2014), the district court of Oregon granted summary judgment in favor of Crum & Specialty Insurance Company, Allied World Assurance Company, and Colony Insurance Company, finding that they had no duty to defend Willowood USA, LLC (Willowood).

The underlying suit arose out of a dispute between two companies, Repar and Willowood, in the business of distributing agricultural pesticides. Repar …

November 12, 2014 Emerging Issues

Californians – “Insurance on My Mind”

California voters had insurance on their minds during the mid-term elections with at least two insurance-related questions on the ballot.

The first was Proposition 45, entitled the “Healthcare Insurance. Rate Changes. Initiative Statute.” If approved, this initiative would have required the state’s Insurance Commissioner to approve any rate increases for individual and small group health insurance plans before those rate hikes took effect. If the state’s Insurance Commissioner determined that a rate hike was unreasonable or excessive, the commissioner could veto the hike. The proposition’s …

November 7, 2014 Emerging Issues

SCOTUS Grants Cert on ACA Tax Subsidy Case

On Friday, November 7, 2014, the U.S. Supreme Court agreed to hear King v. Burwell, one of the cases about who is eligible for the tax subsidies in the Affordable Care Act (ACA). These subsidies are a critical part of the legislation as they are designed to help make health insurance affordable. As we discussed in a prior post, at least two U.S. Circuit Courts of Appeal have issued different interpretations on this language.

In King v. Burwell, the 4^th Circuit …

November 3, 2014 Emerging Issues

Missouri Federal District Court Rejects Advertising Injury Coverage for Counterfeit Goods Suit

In Colony Insurance Co. v. Frison Flea Market, Inc., No. 4:13CV2193(JCH), 2014 U.S. Dist. LEXIS 130841 (E.D. Mo. Sept. 18, 2014), the district court found no coverage under the “personal and advertising injury” part of the subject insurance policy because there was no alleged causal connection between the advertising and sale of counterfeit goods.

As background, Jack Frison and Frison Flea Market Inc.’s (Flea Market) were found liable for having infringed Coach’s trademarks and copyrights by, in pertinent part, allowing the illegal sale of …

October 31, 2014 Emerging Issues

Ninth Circuit Finds No Implied Disparagement Coverage in First Case Decided After Swift Distribution

The Ninth Circuit affirmed the dismissal of Bullpen Distribution’s (Bullpen) suit against Sentinel Insurance Company (Sentinel) for breach of insurance contract, bad faith failure to defend, and declaratory relief. Bullpen Distribution, Inc. v. Sentinel Ins. Co., No. 12-16369, 2014 U.S. App. LEXIS 17497 (9th Cir. Sept. 10, 2014). The coverage dispute derives from allegations by A.Y. International, Inc (AYI) that Bullpen sought to take credit for AYI’s business practices and achievements and pass of AYI’s achievements, business relationships and practices, and history of prompt …