Viewpoint: Adjusting to the ‘Post-Truth’ Environment Driving Up Insurance Claims Costs

October 18, 2021
Michael Germano - Engineering News-Record

Social Inflation is a term insurers are using to describe increasing insurance losses. It is fueled by societal instability and appeals to emotion and fear, which cause higher jury awards, larger settlements and the inevitable result—more litigation.

ENR may be contacted at ENR.com@bnpmedia.com


Hurricane Ida Could Cost Insurers as Much as $30 Billion, Swiss Re Says

October 11, 2021
Christian Baumgaertel - Bloomberg

The insurance industry could face claims of as much as $30 billion from hurricane Ida, which caused extreme wind and flood damage across parts of the U.S. after making landfall in late August.

Insured losses from the storm, the second-most intense hurricane to hit the state of Louisiana, will probably range between $28 million and $30 million, the reinsurer said in a statement Tuesday. It estimated its own cost from claims related to the storm at about $750 million.


Vermont and New Hampshire Request $7M+ in Federal Disaster Relief for Infrastructure Storm Damage

October 4, 2021
Johanna Knapschaefer - Engineering News-Record

Vermont and New Hampshire have requested more than $7 million in federal disaster relief from the Biden Administration for major infrastructure damage that resulted from a severe storm and flood event in late July and early August.

ENR may be contacted at ENR.com@bnpmedia.com


Personal Liability for Unpaid Industrial Insurance Premiums

September 29, 2021
Cameron Sheldon - Ahlers Cressman & Sleight PLLC

In March 2021, the Washington State Court of Appeals, Division One, issued an opinion holding corporate officers personally liable for unpaid industrial insurance premiums. Coaker v. Washington State Dep’t of Lab. & Indus., 16 Wn. App. 2d 923, 484 P.3d 1265 (2021).

Mike and Marilee Coaker (collectively “the Coakers”) founded Mike’s Roofing in 1988. In 2012, the Department of Labor and Industries (L&I) imposed an assessment for unpaid industrial insurance premiums on the Coakers’ construction business. The assessment ultimately forced Mike’s Roofing out of business in 2015.

Ms. Sheldon may be contacted at cameron.sheldon@acslawyers.com


Understanding Builder's Risk Insurance Coverages and Exclusions

September 20, 2021
Erin Rotz - Construction Executive

With all the questions a builder may have for a developer, architect, designer and property owner, there are some inquiries that should be addressed first to help identify and understand any climate, accidental and unforeseen risks to a project. Understanding the type of protections builders should consider before starting a job can make all the difference in the success of a project and make sure the right insurance protection is in place.

Builders should consider all the exposures before purchasing coverage though. It is important to do an inventory of all the specific project’s exposures at different phases of the project, including those at the construction site, in transit or at a temporary storage site. A builder may choose to get broad protection for property of all kinds at all locations or narrow coverage to a specific property and risks. Regardless of the level chosen, a builder will need to review the policy to mitigate any coverage gaps.

Reprinted courtesy of Erin Rotz, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.

Ms. Rotz may be contacted at Erin.Rotz@thehartford.com


Travelers Marks National Suicide Prevention Week with New Resources for Contractors

September 13, 2021
Travelers

HARTFORD, Conn.--(BUSINESS WIRE)-- In recognition of National Suicide Prevention Week, The Travelers Companies, Inc. (NYSE: TRV) today released a new white paper and Risk Control eGUIDE designed to help contractors assess and implement suicide-in-construction awareness programs.

Travelers is also supporting the Construction Industry Alliance for Suicide Prevention (CIASP) and its goal of creating a zero-suicide industry. Construction companies can access CIASP’s trainings, posters, toolbox talks and self-assessments free of charge to help them evaluate their mental health and suicide prevention preparedness.

To review these resources, please visit the Suicide in the Construction Industry and Suicide and the Construction Worker webpages on Travelers.com.


Senate-Passed Infrastructure Bill Would Give Disaster Resilience Loan Fund $500 Million

September 6, 2021
Annemarie Mannion - Engineering News-Record

The $1.2-trillion infrastructure bill recently approved by the U.S. Senate includes $500 million for a revolving loan fund created earlier this year that would allow cities and other municipalities nationwide to pay for projects that improve resiliency against floods, hurricanes and other natural disasters.

ENR may be contacted at ENR.com@bnpmedia.com


Lifting and Related Injuries Now Second on Workers' Compensation Cost List

August 30, 2021
Richard Korman - Engineering News-Record

One perennial cause of why construction workers get hurt on the job—lifting, pushing or pulling things—has risen to second place in one major insurer's latest ranking of most costly injuries. They account for about one out of five dollars of construction-related workers' compensation claims, or $2.21 billion.

Mr. Korman may be contacted at kormanr@enr.com


Insurer’s “Unfair Competition” Exclusion Defense to Product Liability Suit Overcooked, For Now, As Pressure Cooker Manufacturer’s Insurance Claim Proceeds

August 23, 2021
Geoffrey B. Fehling - Hunton Insurance Recovery Blog

A California federal district court recently denied an insurer’s motion to dismiss a manufacturer’s insurance coverage suit on the grounds that an “unfair competition” exclusion barred coverage for a suit that alleged violations of the Colorado Consumer Protection Act. The court allowed the suit to proceed because the exclusion did not clearly, explicitly, and unambiguously apply to the product liability suit alleged against the manufacturer. The decision in Arovast Corporation v. Great American E&S Insurance Co., No. SACV 21-596-CJC (C.D. Cal. Aug. 2, 2021) highlights the broad range of activities that can be found in “unfair competition,” “antitrust,” and similar exclusions and how they can be cited as grounds to deny coverage in a variety of contexts beyond the anti-competitive claims those labels may suggest to most policyholders.

Mr. Fehling may be contacted at gfehling@HuntonAK.com


First Federal Appellate Ruling on COVID-19 Goes to Insurers

August 16, 2021
Alan Packer - Newmeyer Dillion

The United States Court of Appeals for the 8th Circuit recently issued the first federal appellate court decision in the country on the issue of business interruption coverage for COVID-19 losses. In Oral Surgeons P.C. v. Cincinnati Insurance Company, No. 20-3211 (8th Cir. 2021) the 8th Circuit found under Iowa law that an oral surgery practice in Iowa was not entitled to business interruption coverage because it had failed to allege or demonstrate “physical loss” or “physical damage” to its premises.

Mr. Packer may be contacted at alan.packer@ndlf.com


What COVID-19 Taught Construction Companies About Insurance

August 10, 2021
Alan Packer - Construction Executive

There’s an ancient proverb that people learn only from their own mistakes. Otto von Bismarck said it better: “Only a fool learns from his own mistakes. The wise man learns from the mistakes of others.” As the construction industry collectively moves past the age of the novel coronavirus into what will hopefully be a new normal, in the aftermath there are lessons to be learned about how insurance programs operate, about unexpected gaps in coverage and about how huge risks that come out of left field can leave companies vulnerable.

Reprinted courtesy of Alan Packer, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.

Mr. Packer may be contacted at alan.packer@ndlf.com


Florida Supreme Court Holds That Insurer Has Standing to Maintain Legal Malpractice Action Against Retained Defense Counsel

August 4, 2021
Lauren S. Curtis & Ashley Kellgren - Traub Lieberman Insurance Law Blog

In Arch Ins. Co. v. Kubicki Draper, LLP, SC19-673, 2021 WL 2232083 (Fla. June 3, 2021) the Florida Supreme Court held that an insurer has standing to maintain a legal malpractice action against retained defense counsel based on contractual subrogation rights.

Arch Insurance Company (“Arch”) insured an accounting firm that was sued by a client for accounting malpractice. The lawsuit gave rise to a claim under the accounting firm’s professional liability insurance policy with Arch. Under the policy, Arch had a duty to defend and retained counsel to defend the accounting firm. Just before trial, the accounting malpractice lawsuit settled within the policy limits for $3.5 million.

Reprinted courtesy of Lauren S. Curtis, Traub Lieberman and Ashley Kellgren, Traub Lieberman
Ms. Curtis may be contacted at lcurtis@tlsslaw.com
Ms. Kellgren may be contacted at akellgren@tlsslaw.com


New Hampshire Court Finds Hoteliers Sustained Covered COVID-19 BI Loss

July 25, 2021
Jonathan O. Aihie & Michael S. Levine - Hunton Insurance Recovery Blog

On Tuesday, a New Hampshire trial court awarded summary judgment to the owner of scores of hotels after finding that the hotels sustained covered “physical loss of or damage to” insured property caused by the pandemic presence of COVID-19 and its viral agent, SARS-CoV-2. The merits ruling is yet another recent victory for policyholders who continue to make headway against an early wave of insurance company dismissals, most of which, unlike the ruling on Tuesday, never considered evidence in support of their decisions.

Reprinted courtesy of Jonathan O. Aihie, Hunton Andrews Kurth and Michael S. Levine, Hunton Andrews Kurth
Mr. Aihie may be contacted at jaihie@HuntonAK.com
Mr. Levine may be contacted at mlevine@HuntonAK.com


Claims that COVID-19 Present on Property Survive Motion to Dismiss

July 19, 2021
Tred R. Eyerly - Insurance Law Hawaii

Plaintiffs successfully argued against a motion to dismiss by alleging COVID-19 was present on their premises and required repairs and alterations to their properties. Legacy Sports Barbershop LLC v. Cont'l Cas. Co., 2021 U.S. Dist. LEXIS 102545 (N. D. Ill. June 1, 2021).

Mr. Eyerly may be contacted at te@hawaiilawyer.com


Claim for Business Interruption Based on Government Orders Precluding Use of Property Survives Motion to Dismiss

July 11, 2021
Tred R. Eyerly - Insurance Law Hawaii

The court found that the insured hair salon and barbershop plausibly alleged an entitlement to coverage for lost business income when the government orders restricted use of the property as intended. Seifert v. IMT Ins. Co., 2021 U.S. Dist. LEXIS 103420 (D. Minn. June 2, 2021).

Plaintiff's business was ordered to close by two executive orders issued in response to the growing number of COVID-19 cases in Minnesota. The policy covered the loss of business income due to a "suspension of your 'operations' . . . caused by direct physical loss of or damage to property . . ." Plaintiff sought coverage for his business losses. IMT Insurance Company denied the claim. Plaintiff sued and IMT moved to dismiss. The motion was initially granted without prejudice and plaintiff filed an amended complaint.

Mr. Eyerly may be contacted at te@hawaiilawyer.com


New Jersey Law Requires Insurers to State Whether Business Interruption Policies Cover Global Virus Transmission, Pandemic Coverage

July 5, 2021
Edward M. Koch & Felix S. Yelin - White and Williams LLP

On May 12, 2021, New Jersey Governor Phil Murphy signed into law a bill requiring insurers to go on record as to whether their policies, which provide coverage for the loss of use and occupancy and business interruption, cover global virus transmission or pandemics. The law first requires an insurer to disclose to new and renewing insureds whether the policy provides such coverage. The Commissioner of Banking and Insurance prescribes the form and manner of providing this notice for this first provision. The law also requires any insurer who has in force such a policy to so inform its insured in writing (via mail or electronic means) within 30 days of the date of enactment.

Reprinted courtesy of Edward M. Koch, White and Williams LLP and Felix S. Yelin, White and Williams LLP
Mr. Koch may be contacted at koche@whiteandwilliams.com
Mr. Yelin may be contacted at yelinf@whiteandwilliams.com


How COVID Impacts Insurance in Unforeseen Ways

June 28, 2021
Gregory S. Capps & Daryn E. Rush - White and Williams LLP

Having recently marked the one-year anniversary of the COVID-19 pandemic, it seems like an opportune time to consider how the pandemic has impacted the insurance industry. While business interruption (BI) lawsuits (totaling more than 1,500 as of March 31, 2021) have dominated the headlines, the pandemic’s effects stretch far beyond BI claims. Indeed, the pandemic has impacted virtually all aspects of the industry and those impacts will likely alter the insurance landscape for years to come.

Reprinted courtesy of Gregory S. Capps, White and Williams LLP and Daryn E. Rush, White and Williams LLP

Mr. Capps may be contacted at cappsg@whiteandwilliams.com
Mr. Rush may be contacted at rushd@whiteandwilliams.com


Hawaii Legislature Sends Three Insurance-Related Bills to the Governor

June 21, 2021
Tred R. Eyerly - Insurance Law Hawaii

The 2021 legislative session has adjourned with three insurance-related bills passed and sent to the governor. The bills are as follows:

SB1096 - The bill makes several additions to the Insurance Code, Chapter 431. It includes various consumer protections with regard to public adjusters. The bill requires contractual terms and disclosures, as well as granting a right to rescind. A standard of conduct is imposed on various entities, including limited line licensees. The bill also touches on motor vehicle rental companies, self-service storage, limited line licenses, and surplus line coverage.

Mr. Eyerly may be contacted at te@hawaiilawyer.com


Construction Site Injuries: Avoiding and Limiting Liability

June 14, 2021
Steven Gonzalez & Aaron Cohn - Construction Executive

Workplace injuries on construction sites are common occurrences. For large projects that span multiple years with deca-million dollar budgets, even contractors with the best safety practices can expect dozens of injuries and related incidents to be reported in a given year. Many more incidents will go unreported, either because the incident is not deemed significant enough, or for other reasons, including the immigration status of the injured.

Reprinted courtesy of Steven Gonzalez & Aaron Cohn, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.

Mr. Gonzalez may be contacted at sgonzalez@wwhgd.com
Mr. Cohn may be contacted at acohn@wwhgd.com


Reinsurance Litigants May Need to Avoid Putting Their Faith in the Tort of Bad Faith

June 7, 2021
Justin K. Fortescue & Andrew L. Blacker - White and Williams LLP

In a recent Alabama federal court decision, aptly captioned Alabama Municipal Insurance Corporation v. Munich Reinsurance American, Inc.,[1] the plaintiff reinsured brought three counts of bad faith against the defendant reinsurer for failing to pay several claims totaling $1.9 million. The court granted the reinsurer’s motion to dismiss the bad faith counts concluding that Alabama does not recognize the tort of bad faith in the reinsurance context.

Reprinted courtesy of Justin K. Fortescue, White and Williams LLP and Andrew L. Blacker, White and Williams LLP

Mr. Fortescue may be contacted at fortescuej@whiteandwilliams.com
Mr. Blacker may be contacted at blackera@whiteandwilliams.com


California Federal District Court Denies, in Part, Insurer's Motion to Dismiss COVID-19 Business Interruption Claim

May 31, 2021
Tred R. Eyerly - Insurance Law Hawaii

In another victory for policy holders on business interruption claims arising from COVID-19, the federal district court denied the insurer's motion to dismiss on one of two claims. Kingray Inc. v. Farmers Group Inc., et al., 2021 U.S. Dist. LEXIS 41300 (C. D. Cal. March 4, 2021).

Plaintiff Kingray Inc., who operated a sports bar and grill, and Plaintiff Nora's Style Salon, Inc. filed suit against Farmers when business interruption coverage was denied under plaintiffs' all risk policies. Government shut-down orders at the beginning of the COVID-19 pandemic caused plaintiffs to suffer loss of business income.

Mr. Eyerly may be contacted at te@hawaiilawyer.com


Illinois Federal District Court Finds Duty to Defend COVID-19 Claim

May 24, 2021
Tred R. Eyerly - Insurance Law Hawaii

The federal district court found that the insurer had a duty to defend the underlying suit based on damages allegedly arising from exposure to COVID-19. McDonald's Corp. v. Austin Mutual Ins. Co., No. 20 C 5057, Order (N.D. Ill. Feb.22, 2021). The decision is here.

Mr. Eyerly may be contacted at te@hawaiilawyer.com


Construction’s Road Through 2021 Will Have Bumps—But Not Insurmountable Ones

May 17, 2021
Kirk Chamberlain & Craig Tappel - Construction Executive

After years of going full-throttle, the U.S. construction industry has been contending with various pandemic-induced bumps in the road that will continue to slow business down and challenge how much resiliency can be mustered for the recovery ahead.

It’s a tough environment to deal with. While there was room for caution after eight booming years in construction spending, the pandemic’s massive disruption has altered the economics of working safely, on time and on budget. The aftereffects are carrying into 2021 as the recovery begins.

Reprinted courtesy of Kirk Chamberlain & Craig Tappel, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.


New York’s App. Div., Second Dept. Addresses Policy Exhaustion Issue, But Doesn’t Resolve Lower Court Split

May 10, 2021
Sarah Rubin - Lewis Brisbois

New York’s Appellate Division, Second Department recently issued a decision in Alleviation Medical Svcs. v. Allstate Ins. Co., 2021 N.Y. Slip Op. 08159 (App. Div., 2nd Dept. 2/24/21), which was anticipated to specifically address the issue of whether an insurer would be required to pay in excess of the $50,000 policy limit if a court or arbitrator determined that a previously denied claim should have been paid. In New York, the Appellate Division is a higher court than the Appellate Term and, thus, its decisions take precedence over Appellate Term decisions.

Ms. Rubin may be contacted at Sarah.Rubin@lewisbrisbois.com



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