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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
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In a unanimous opinion which will impact the plaintiff bar’s strategies for “setting up” liability insurers for “failure to settle” bad faith claims, a California appeals court held in
Pinto v. Farmers Ins. Exchange (No. B295742, filed 3/8/21) that a bad faith failure to settle claim requires a finding that the insurer acted unreasonably in some respect. Because the jury verdicts proposed by the plaintiff did not require the jury to make such a finding, the $10 million judgment against the insurer was reversed and judgment is to be entered in its favor.