Insurance

Deciding a question left open in Montrose Chemical Corp. v. Superior Court (2020) 9 Cal.5th 215, this decision holds that in a case involving coverage for injuries occurring over multiple coverage periods, the insured can reach an excess policy after "vertically" exhausting any primary insurance policies for the same period, but need not exhaust all primary insurance policies "horizontally" over… Read More

A liability insurer liable on claims against the debtor is a "party in interest" that is entitled to raise and have heard its objections to the debtor's Chapter 11 plan under 11 USC 1109(b).  The Bankruptcy Code uses party in interest to broadly cover anyone whose interests might be adversely affected by a Chapter 11 plan.  The legislative history shows… Read More

Plaintiff obtained a CGL policy from defendant which included an exclusion from coverage for injuries suffered by employees of a contractor.  The exclusion did not define "contractor."  The decision holds that the term is ambiguous.  It could mean anyone contracted to work on a construction project, as the insurer contended.  Or it could mean anyone with whom the insured had… Read More

The actual or potential presence of COVID-19 on an insured’s premises generally does not constitute direct physical loss or damage to property within the meaning of a commercial property insurance policy under California law.  Direct physical loss or damage to property requires a distinct, demonstrable, physical alteration to property.  Any alternation of the premises due to the adherence of COVID-19… Read More

There was a triable issue of fact as to how to compute the amount of income lost due to a covered event--the theft of the insured's inventory--over what period the average pre-loss income should be measured and the amount of income that would have been earned but for the covered loss.  However, the insured was not entitled to recover for… Read More

Following Eott Energy Corp. v. Storebrand Internat. Ins. Co. (1996) 45 Cal.App.4th 565, this decision holds that for purposes of determining the deductible and the limits of coverage, an "occurrence" is an event that causes loss, not the loss or the insurance claim.  So, if the same cause results in two losses, there is only one occurrence, one deductible, one… Read More

This decision follows John's Grill, Inc. v. Hartford Financial Services Group, Inc. (2022) 86 Cal.App.5th 1195, review granted in holding that under a virus coverage endorsement similar to the one in John's Grill, the policy provides coverage for the virus including virus decontamination is not limited to cases of physical loss or damage apart from the presence of a virus,… Read More

When an adult child is an insured under the parents' auto insurance policy, the insurer must give the adult child as well as the parents (who are the policyholders) notice of cancellation or nonrenewal.  Absent advance notice properly given, the insurance continues in effect despite the insurer's attempt to cancel it. Read More

Under Ins. Code 2071.1, an insured who is asked to submit to an examination under oath by a property insurer has, among others, the right to make a recording of the entire proceeding.  This decision holds that the statute allows the insured to videotape both the insured and the insurer's personnel during the examination. Read More

Under Ins. Code 11580.2(f), insured and insurer must arbitrate any dispute about whether the insured is entitled to recover damages from an uninsured motorist and the amount of those damages.  The trial court erred in denying the insurer's motion to compel arbitration.  The insurer did not waive arbitration by failing to pay the insured the amount that the insured claimed… Read More

Pep Boys extended their multiple-layer products liability insurance policies from one year to 17 months to align their insurance policies with their fiscal year.  Several of the extended policies stated that the policy was subject to a limit of” $x million in the aggregate for each annual period during the policy period.  This decision holds that the policy language cannot… Read More

The contamination exclusion in the Sharks business interruption insurance policy prevented the Sharks from showing any covered  physical loss or damage to property due to COVID-19.  If COVID stuck to surfaces making the premises unsafe, the alteration was an excluded contamination of the premises. Read More

This decision holds that some but not all claims for retaliation for whistleblowing activities, in violation of Lab. Code 1102.5, are not intentional acts for which insurance defense and indemnity is barred by Ins. Code 533.  In particular, under Lab. Code 1102.5(c), an employee is protected if he refuses to perform work duties if doing so is actually (not just… Read More

Acknowledging that both issues have generated a split of authority and are now before the Supreme Court for its review, this decision holds that (1) direct physical loss or damage to property, rather than mere loss of the property’s use, is a prerequisite for coverage under normal business interruption insurance policies, and (2) the ephemeral existence of COVID-19 or its… Read More

A motor carrier is required to carry vehicle insurance with a minimum coverage limit of $750.000.  Veh. Code 34631.5.  This decision holds that the statute regulates only the motor carrier and imposes no duty on an insurer that does not certify its insurance meets the statutory standards.  The carrier can obtain insurance from multiple insurers to meet its statutory obligation… Read More

An Ins. Dept. regulation requires insurance companies who sell variable life insurance—that is, a life insurance policy that also functions as an investment vehicle—to “adopt” and “use[]” standards in order to assess whether such insurance is “suitab[le]” to recommend and issue to potential investors. (Cal. Code Regs., tit.10, §2534.2(c);1 Ins. Code, § 10506(h).)  This decision holds that when the insured's… Read More

Interpreting Oregon law, the Ninth Circuit holds that a business interruption insurance policy that covered only losses due to direct physical loss or damage did not cover income lost due to COVID-19 government closure orders.  To fall within the policy's coverage, the loss must be due to a physical alteration of the property, which plaintiff didn't and couldn't allege. Read More

Unlike prior law which it replaced, California’s Motor Carriers of Property Permit Act (Veh. Code, § 34600 et seq.) does not require an insurer of motor carrier to provide coverage during the period between the end of the insurance policy's term and the date the insurer cancels the certificate of insurance on file with the DMV.  Transamerica Ins. Co. v.… Read More

Fire insurance policies must be written on the statutory form that includes a one-year from inception of loss (semi-contractual) statute of limitations.  This decision holds that the insured cannot circumvent that limitations provision by bringing suit under the UCL for an injunction against denial of insurance coverage under similar circumstances.  To have standing to sue under the UCL, the plaintiff… Read More

The trial court properly granted summary judgment against the plaintiff insureds who sought coverage under their named peril property insurance policy for loss of their frozen embryos due to a failure of the refrigeration unit of the embryo storage company.  The insureds could not prove that the embryos had suffered physical damage.  The storage company refused to say, and the… Read More