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(Bad Faith Verdict Reversed as Plaintiff Failed to Include
Instruction Requiring That Insurer Acted Unreasonably in Refusing
to Accept Reasonable Settlement Demand)
(April 2021) - In
Pinto v. Farmers
Ins. Exch., - Cal.App.5th - (March 8, 2021), the California
Second District Court of Appeal reversed a judgment finding that
Farmers Insurance Exchange ( Farmers ) acted in bad faith
by refusing to accept a reasonable offer to settle a personal
injury lawsuit within policy limits. The jury verdict form did not
include a finding relative to whether Farmers had acted
Keeping the Cap On the Policy: Unreasonable Conduct Is a Necessary Element of a Bad Faith Failure to Settle Claim | Sheppard Mullin Richter & Hampton LLP jdsupra.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from jdsupra.com Daily Mail and Mail on Sunday newspapers.
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Keeping the Cap On the Policy: Unreasonable Conduct Is a Necessary Element of a “Bad Faith Failure to Settle” Claim Tuesday, March 9, 2021
Pinto v. Farmers Ins. Exch., Cal. App. 5th (2021)
Over the past several years, the insurance industry in California has been plagued by waves of “bad faith failure to settle” claims. These claims arise out of a variety of circumstances and can take many forms, but at their core involve the following: an insured injures a third party; that third party then offers to settle his/her claim for the policy limits; but the insurer, for one reason or another, fails to accept that settlement demand. Once that happens, the third party claimant then takes the position that the “cap is off” the policy such that the insurer should be responsible for paying the full amount of any judgment the claimant obtains against the insured, even if it exceeds the policy limits.