Can an Insurer Escape Bad Faith Liability When it Unreasonably Forces an Insured to Arbitrate an Uninsured Motorist Claim? No Way!

Posted in: Auto Insurance, Bad Faith, Case Updates July 14, 2014

In a very good ruling for policyholders, the California Court of Appeal ruled that an insurance company cannot escape insurance bad faith liability by forcing a claimant to arbitrate his claim without first fairly investigating, evaluating and attempting to resolve the claim.  In Maslo v Ameriprise Auto & Home Insurance, 2014 Cal. App. LEXIS 564, 2014 WL 2918866 (June 27, 2014), the court explained that “[t]here can be no serious dispute that an insurer is required to thoroughly and fairly investigate, process, and evaluate its insured’s claim,” and the failure to do so exposes the insurer to bad faith liability.…

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Want to Open Up the Policy Limits on a Policy? Try Making a Section 998 Offer Above Policy Limits and You Just May Be Able to Do It

Posted in: Auto Insurance, Breach of Contract, Duty to Settle, Insurance Bad Faith October 18, 2013

Can a pretrial California Code of Civil Procedure section 998 offer to settle above an insurer’s policy limits result in opening up a policy’s liability limits?  Interestingly, a California Court of Appeal has said “yes” to this question under certain limited circumstances if the offer is reasonable and made in good faith.  In Aguilar v. Gostischef, ___ Cal. App. 4th ___, 2013 Cal. App. LEXIS 816, 2013 WL 5592976 (Oct. 11, 2013) (“Aguilar”), the California Court of Appeal held that where an injured party rationally believed an insurer may be liable for excess judgment, and the insurer refuses to provide this third-party with the amount of policy limits when requested prior to litigation, a section 998 offer …

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Alas, A Very Hot Issue in California Insurance Law is Decided (At Least for Now): Insurers Have No Affirmative Duty to Settle as Long as They Do Not Foreclose the Possibility of Settlement and/or Absent a Within-Policy-Limits Settlement Demand

Posted in: Auto Insurance, Breach of Contract, Duty to Settle, Insurance Bad Faith October 18, 2013

One of the hottest issues in California insurance law has been whether a breach of the good faith duty to settle can be found in the absence of a within-policy-limits settlement demand, thus giving rise to an insurer’s liability for an excess judgment.…

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The Ninth Circuit Amends Opinion in Du v. Allstate removing policyholder friendly language

Posted in: Auto Insurance, Case Updates, General Liablity, Insurance Bad Faith October 15, 2012

We recently wrote about a policyholder friendly opinion by the Ninth Circuit Court of Appeals that seemingly held that an insurer’s duty of good faith and fair dealing, which is implied in every contract of insurance, may be violated by the insurer’s failure to attempt to effectuate a settlement within policy limits after liability of its insured has become reasonably clear, even without a policy limits settlement demand.  In other words, the court held that a demand within policy limits was not an element of a bad faith failure to settle claim.  The Ninth Circuit, on October 5, 2012, issued an amended opinion deleting this language and leaving open the questions: 1) whether the duty to settle can be breached …

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Bad Faith Liability May Be Premised on an Insurer's Failure to Effectuate Settlement When Insured's Liability Was Reasonably Clear

Posted in: Assignment of Claim, Auto Insurance, Case Updates, General Liablity, Insurance Bad Faith June 20, 2012

The Ninth Circuit Court of Appeals in a recent decision held that an insurer’s duty of good faith and fair dealing, which is implied in every contract of insurance, may be violated by the insurer’s failure to attempt to effectuate a settlement within policy limits after liability of its insured has become reasonably clear.  In essence, the Court found that an insurer’s unreasonable refusal to attempt to effectuate settlement after the evidence reasonably indicates that the insured’s liability will be in excess of the policy limits constitutes bad faith.…

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Duty to Defend Triggered by the Peculiar Risk Doctrine

Posted in: Auto Insurance, Case Updates, Duty to Defend, News December 26, 2009

In Amer. States Ins. v. Progressive Casualty Ins., 180 Cal. App. 4th 18 (2009), the California Court of Appeal addressed the “peculiar risk” doctrine in the context of an insurer’s duty to defend.

Victor Meza was a self-employed truck driver who was hired by Western Trucking LLC (“Western”) as an independent contractor.  While driving a tractor trailer owned by Western and insured by Wilshire Insurance Company (“Wilshire”), Meza collided with a pedestrian, Yevdokia Bristman, seriously injuring him.  Bristman later sued the grading contractor who hired Western, Vinci Pacific Corporation and the general contractor, Garden Communities (collectively “Vinci Pacific”).

Meza’s liability insurance carrier was Progressive Casualty Insurance Company (“Progressive”) and American States Insurance Co (“American”) provided the commercial auto liability …

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