In a recently unsealed opinion, a trial court in Delaware granted summary judgment to three excess insurers holding that a prior knowledge exclusion in warranty letters provided to the excess insurers precludes coverage for government investigations, enforcement actions, and civil
Insurance Coverage Notes and Developments
News and analysis of legal issues affecting the Insurance Industry
Insurance Coverage Notes and Developments, published by Dykema, focuses on legal issues related to insurance coverage disputes and developments. The blog covers court decisions interpreting insurance policy provisions such as exclusions, duties to defend, and claims-made requirements. It addresses topics including bad faith claims, reservation of rights, reimbursement of defense costs, and the application of contract exclusions in insurance policies. The blog also discusses litigation strategies and outcomes in insurance coverage cases across various jurisdictions, providing insights into how courts analyze and apply insurance law principles in complex factual scenarios.
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Michigan Coverage Dispute Highlights Steep Cost of Statutory Penalty Interest
Statutory penalty interest can be a significant exposure for insurers in some jurisdictions. A court’s recent ruling in Alticor Global Holdings Inc., et al. v. American International Specialty Lines Insurance Co., et al., Case No. 1:17-cv-388, 2022 U.S. Dist.…
Recent Rulings in Delaware Courts on Allocation Under D&O Policies
Delaware state and federal courts have issued several important rulings on allocation under D&O insurance policies. Most recently, in SSC Technologies Holdings, Inc. v. Endurance Assurance Corp., No. N20C-01-088 EMD CCLD, 2022 Del. Super. LEXIS 164 (Del. Super., April 26,…
New York Trial Court Enforces D&O Policy’s Insured Capacity Limitations and Exception of SEC Disgorgement Amounts from Covered Loss
By Jeffrey Ward
A trial court in New York has granted summary judgment for a group of D&O insurers seeking a declaration that policies issued to AR Capital, LLC (“AR Capital”) do not provide coverage for settlements and consent judgments in actions alleging…
Somebody’s Watching Me: A Recent Smart-TV Lawsuit Seeks Insurance Coverage for Privacy Litigation
After the Fourth Circuit held that a commercial general liability (“CGL”) policy could cover a data incident in 2016, confusion arose as to whether CGL policies would continue to cover data breaches. A recent California lawsuit by the smart-TV maker…
Pennsylvania Court Estops Insurer From Asserting Coverage Defense That Was Not Identified in Its Reservation of Rights Letter
By Jeffrey Ward
A split appellate court in Pennsylvania has held that an insurer is estopped from asserting a policy exclusion that it failed to expressly raise in its reservation of rights letter. See Selective Way Ins. Co. v. MAK Servs., No. 1289 EDA…
Not All Violation of Statutes Exclusions Are Created Equal
By Dykema
Coverage litigation relating to liability claims arising out of the Illinois Biometric Information Privacy Act (“BIPA”) has been relatively non-existent. One reason for this may be insurers’ reasonable conclusion that an exclusion introduced in 2006 in response to litigation arising…
Still Only Eight Corners?: The Texas Supreme Court Decides Richards v. State Farm
In November, the Texas Supreme Court accepted a certified question from the Fifth Circuit directly calling into question the continued vitality of the well-known “eight corners rule,” under which a liability insurer can only consider the four corners of the…
Headline: “SXSW Disaster: Event Admits It Has No Insurance for Coronavirus Cancellation”
That headline appeared Saturday in Music Business Worldwide, a trade paper, as well as in numerous other journals ranging from Variety to the Austin Chronicle. If you dug a little deeper, you would see that there was cancellation insurance for…
Maryland Court Orders Insurance Company to Pay Ransomware Damages Under Businessowner’s Policy
The United States District Court for the District of Maryland recently held that an insurer must cover an insured’s costs to replace its computer systems following a ransomware attack. The case, National Ink and Stitch, LLC v. State Auto Property and…