Bad Faith Blog

One of Missouri’s statutes aimed at curbing abusive tactics used to “set up” extra-contractual claims in Missouri was construed as providing thirty days to intervene even when there was no pending lawsuit.

Summary: Workmen’s Auto Insurance Company concluded it was not required to pay attorney fees because it made a timely tender before the uninsured motorist action was filed. Furthermore, the $25,000 fee award was contrary to the Oregon fee shifting statute’s policy objectives. The trial and appellate courts disagreed.

Here the issue was the conduct of the insurer under in handling a claim for underinsured motorist coverage. The injured insured had presented evidence of future wage loss of over $4,000,000.00, but liability coverage of only $3,000,000.00.

Summary: Progressive Casualty Insurance Company (“Progressive”) issued a Directors and Officers (D&O) Liability Policy to the National Bank of California (“Bank”) on October 30, 2010. The Declarations Page stated that the defense costs were included within the limit on liability. The policy further gave the insured a defense option, but the Bank did not choose the defense option for D&O Liability. The Bank presented six separate claims to Progressive to which Progressive asserted multiple affirmative defenses. The Bank and Progressive then filed multiple partial motions for summary judgments relating to key issues regarding the claims handling. Only two of those complex issues are addressed here.

Veterinarians sued insurers for an allegedly improper defense under a professional liability insurance policy. The insurers filed a counterclaim seeking reimbursement. After the matter was sent to arbitration, the arbitration award did not include a finding that the insured’s Cumis counsel charged fees which were “reasonable and necessary.” In view of the failure to find that the insurer had improperly withheld the full amount of the fees and the further finding that the sanctions imposed for breach of a protective order, precluded a finding of coverage under California law and gave rise to a claim for reimbursement by the professional liability insurer.