Insurance Coverage Considerations Stemming from the New California Child Victims Act

On October 13, 2019, when California’s governor signed AB 218—the California Child Victims Act (CCVA)—California became one of at least nine other states to enact some form of window legislation for childhood victims of sexual assault. The CCVA became effective on Jan. 1, 2020. This article explores the CCVA’s pertinent changes to existing law for pursuing childhood sexual assault claims, as well as some of the key insurance coverage issues arising from this new law.

The text of the CCVA is substantively similar to other …

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Application Sinks Insured’s Claims Against Agent Over Hole-In-One Coverage

Key Takeaways:

  • Extends the “duty to read” principle typically applied to insurance policies to applications submitted by insureds for such policies
  • Reasonable expectations doctrine only applies when the terms of the policy itself are ambiguous

After losing an extended coverage battle with its insurer that ultimately resulted in a finding of no coverage by the Fourth Circuit, the insured in Old White Charities, Inc. v. Bankers Ins., LLC, No. 18-1914, 2020 WL 290664 (4th Cir. Jan. 21, 2020) took aim at its insurance agent, asserting claims of …

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Ohio Supreme Court Holds Insurers Not Responsible for Charging Liens

The Ohio Supreme Court held that an insurer who settles a personal injury claim with an accident victim has no duty to issue payment directly to the victim’s former lawyer pursuant to a charging lien.[1]

In the underlying personal injury matter, an automobile accident victim hired a law firm to represent him. The victim and his law firm entered into a contract that granted the law firm a charging lien on the proceeds of any insurance payment, settlement, judgment, or verdict that might be …

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Texas Supreme Court Hears Argument on Whether to Adopt Exception to Eight-Corner Rule

At oral argument in the case of State Farm Lloyds v. Janet Richards,[1] the Texas Supreme Court heard from both sides on whether or not Texas courts should recognize a policy-language based exception to the eight-corners rule, applied when evaluating whether an insurer can introduce extrinsic evidence to contest its duty to defend the insured for a third-party liability claim. The so-called eight-corners rule allows a court to refer only to the relevant policy terms and factual allegations in the complaint against the …

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NY Appellate Court Confirms an Absence of Negligence is no Roadblock to AI Coverage

New York’s Appellate Division, First Department, handed insurers a lump of coal this holiday season, unanimously holding that a contractor’s insurance company (Insurer) owed a property owner and manager (Building Defendants) primary coverage as additional insureds, even though its named insured had nothing to do with the allegedly negligent acts giving rise to the subject injury, and despite the named insured previously prevailing against the Building Defendants’ claims for common law and contractual indemnification. As the First Department panel concluded, because the additional insured clause …

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Failure to Issue a Reservation of Rights, and to Address an Insured’s Affirmative Defenses in a Coverage Dispute, May Preclude Denial of an Otherwise Excluded Claim

A recent Florida state court opinion emphasizes the importance of an insurer’s obligations in the event of a liability claim against an insured and a subsequent coverage dispute with that insured.

In Hurchalla v. Homeowners Choice Property & Casualty Insurance Company, the insured was sued for tortious interference with business contracts. Although her liability policy did not insure against intentional acts, the insurer initially provided the insured with a defense. However, the insurer neglected to inform the insured that the defense was being provided …

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Insurers Be Ready: New Jersey’s Two-Year Window Reviving Time-Barred Sex Abuse Suits is Open

On December 1, 2019, the two-year look-back period created by New Jersey Senate Measure S477 went into effect, reviving claims of sexual abuse that would otherwise be barred under the statute of limitations.

In March 2019, S477 passed in the New Jersey State Senate by a vote of 32 to 1, followed by passage in the New Jersey State Assembly by a vote of 71-0, with five abstentions. The bill was signed into law by New Jersey Gov. Phil Murphy on May 13, 2019.

One …

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Florida Court Requires Plaintiff to Plead More Facts About a Cause of Loss

The U.S. District Court for the Middle District of Florida dismissed a property insurance case after holding that ambiguous, non-specific pleading of a cause of loss is not enough. Causation is often a focus in property insurance cases. The exact cause of a particular loss will determine if the loss is covered or excluded under the insurance policy—meaning whether a plaintiff-insured will recover from their insurer. However, in state and federal courts, plaintiffs often get by with pleading merely that “a covered loss occurred during …

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Illinois: Latest State to Declare Malicious Prosecution Claims Only Trigger Coverage in Effect During Arrest

In this era of sophisticated DNA testing, exonerations of incarcerated individuals have become increasingly commonplace. The ensuing malicious prosecution lawsuits have justifiably resulted in high verdicts and settlements. The key issue for many municipalities is whether coverage is triggered for these malicious prosecution claims, and under which policies of insurance. On November 21, 2019, the Supreme Court of Illinois, in Sanders v. Illinois Union Insurance Company, 2019 IL 124565, definitively determined that claims of malicious prosecution trigger coverage only under policies of insurance in …

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Florida Bridge Collapse Resolution Offers Workaround for Multiple Claimant Scenarios

A recent bankruptcy plan filed by Munilla Construction Management (MCM)–the general contractor for the failed pedestrian bridge at Florida International University (FIU)–paves the way for judicially recognized interpleader-type scenarios allowing insurers to resolve multiple-claimant incidents where there may be insufficient policy limits. On November 15, 2018, the Southern District of Florida Bankruptcy Court agreed to expedite a process that would allow victims of the pedestrian bridge collapse to start receiving compensation payouts following the creation of a victim’s fund.

By way of background, a pedestrian …

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