Neither Insurer’s Arbitration Award Against Policyholder or Her Alleged Misrepresentations Precluded Trial Court’s Bad Faith Award The Illinois First District Appellate Court, applying Illinois law, affirmed the lower court’s decision that an insured was entitled to attorney fees and penalties for its insurers’ failure to assert a bona fide defense for its denial of the insured’s claim.  The appellate court found that while the insurer... Read More

Multiple Limits of Liability Clauses Create Ambiguity and Defeat Anti-Stacking Provisions. The Illinois Fifth District Appellate Court, applying Illinois law, modified a judgement by the Circuit Court of Franklin County and held that an anti-stacking provision in an auto insurance policy did not prohibit stacking of liability limits where limitations of liability were set forth on separate pages and referenced separate sets of automobiles. ... Read More

Electrical Currents Exclusion Bars Coverage for Damage to City’s Power Station In a unanimous decision, the Supreme Court of Iowa, applying Iowa law, affirmed the appellate court’s ruling that an electrical currents exclusion applied to bar coverage for property damage resulting from an electrical arc that was triggered by a squirrel.   In November 2014, a squirrel entered an electrical power plant in the City... Read More

Use of Incorrect Ingredient in Baby Formula Not “Physical Injury to Tangible Property.” The Court of Common Pleas of Delaware County Ohio, applying Ohio law, granted summary judgment in favor of an insurer holding that the insurer has no duty to defend or indemnify policyholder in an underlying breach of contract action because the tainted product did not qualify as covered property damage as defined by... Read More

Applying GA Law, Coverage for Welder’s Lung Claim Barred by Pollution Exclusion. In an unpublished opinion, the Eleventh Circuit, applying Georgia law, affirmed a district court decision holding that a lung disease resulting from the inhalation of welding fumes fell within a policy’s pollution exclusion, because it qualified as an injury arising out of the release, escape or dispersal of a pollutant.  John Flowers,... Read More

Consumer Fraud, Bad Faith and Misrepresentation Claims Dismissed.     In a first party property insurance case, Magistrate Judge Kim, Northern Dist., Eastern Div., IL, dismissed various causes of action including consumer fraud, misrepresentation and bad faith.   The Plaintiffs, Propitious, LLC (“Propitious”) and Connacht, LLC, (“Connacht”), sued Badger Mutual Insurance Company (“Badger”) and Society Insurance (“Society”), for coverage under two separate insurance policies for water damage to a... Read More

Triggered Despite Allegations That Defamation Made Knowingly. A federal court for the Central District of Illinois, in an opinion written by Judge Shadid, applied Illinois law and granted an insured’s motion for summary judgment on the duty to defend.  The court found that because the policy at issue arguably provided coverage for libel or slander, the insurer had a duty... Read More