California Fair Plan Assn. v. Garnes

Under a homeowner’s policy providing “open actual cash value coverage,” the insurer must pay, on a partial loss claim, the lesser of (a) the policy limits or (b) the actual cost of repair, even if the repair cost exceeds the property’s pre-loss market value.  Under Ins. Code 2051, a homeowner’s policy providing open (meaning the…

Southern Ins. Co. v. Workers Compensation Appeals Bd.

Insured company misrepresented in its worker’s compensation insurance application that its workers traveled only within a 200 mile radius of its headquarters in California, so appeals board needed to determine whether insurer’s resulting rescission was effective.  Like other insurers, a worker’s compensation insurer may rescind its policy for misrepresentations in the insurance application.  On remand,…

Friedman v. AARP, Inc.

Plaintiff stated a viable unfair competition law claim by alleging that the insurer paid almost 5% of his Medicare gap insurance premiums to the American Association of Retired People as a disguised commission even though it was not a licensed California insurance agent.  A plaintiff who bought Medicare gap insurance through the AARP Insurance Plan,…

Stein v. Axis Ins. Co.

At least when a directors and officers liability policy provides a defense on appeal, its provision requiring reimbursement of defense costs upon a “final determination” the insured was guilty of willful misconduct applies only after completion of the appeal.  When a D&O policy provided for the insurer to pay for the directors’ and officers’ defense…

Teleflex Medical, Inc. v. National Union Fire Ins. Co.

If an excess insurer rejects a settlement proposed by the primary insurer and insured and does not assume the insured’s defense, it cannot avoid liability for paying its share of the settlement (if a court later finds the settlement reasonable) by relying on the excess policy’s no-action clause.  This decision follows Diamond Heights Homeowners Assn….

Mercury Casualty Co. v. Jones

It was not an abuse of discretion to deny plaintiff’s request to raise its auto insurance rates, since its advertising expenses were properly excluded from rate calculation.  The Insurance Commissioner did not abuse his discretion in denying Mercury’s request to raise its auto insurance rates.  Mercury’s advertising expenses were properly excluded from the rate calculation…

Medina v. GEICO Indemnity Co.

A van the driver’s employer gave her for business and personal use was a non-owned vehicle furnished for the driver’s regular use and thus was excluded from coverage under the driver’s personal auto policy.  An auto insurer was properly found not liable for injuries its insured caused while driving a van that her employer had…

Association of California Insurance Companies v. Jones

The California Insurance Commissioner did not exceed his powers in promulgating regulations governing an insurer’s communicating an estimate of replacement costs to an insured.  The Unfair Insurance Practices Act (Ins. Code 790-790.15) grants the Insurance Commissioner authority to promulgate regulations deeming insurance practices other than those set out in the UIPA to be unfair, deceptive…

Navigators Specialty Ins. Co. v. Moorefield Construction Co.

Insurer owed no duty to indemnify an insured construction contractor under a CGL policy for damages it paid the owner of a building for injury to the building’s flooring, since the injury occurred because the insured performed a deliberate, non-accidental act—ordering the subcontractor to lay the flooring over wet concrete—and there was no additional, unexpected,…

Advent, Inc. v. National Union Fire Ins. Co.

In this litigation between excess insurers of a prime contractor and a subcontractor whose employee was badly injured on the job and recovered a $10 million settlement, the prime contractor’s insurer failed to introduce evidence on summary judgment proving that the sub or the employee was at fault and thus that the loss was actually…

Tidwell Enterprises, Inc. v. Financial Pacific Ins. Co., Inc.

CGL insurer owed its insured, a contractor, a duty of defense against claim that the insured’s mis-installation of a chimney caused a fire that destroyed the house; even though the fire occurred outside the policy period, the wood surrounding the chimney may have suffered progressive deterioration starting in the policy period and ultimately leading to…

Nickerson v. Stonebridge Life Ins. Co.

In an insurance bad faith case, the trial court properly remitted punitive damages from the $19 million awarded by the jury to $475,000, which was ten times the actual damages awarded.  This decision affirms a trial court’s remittitur of punitive damages in an insurance bad faith case from the $19 million awarded by the jury…