Texas Supreme Court Sides with Insure on Mold-Related Policy Changes
The Texas Supreme Court on April 9 reversed lower court rulings and found that Farmers Insurance was within its rights when it decided 19 years ago not to renew homeowners’ policies that it feared would have forced it to cover mold damage.
The 7-0 decision overturns rulings that required the carrier to renew 400,000 insurance policies that were thought to include coverage for all risks to dwellings, not just named perils. The high court also reversed orders by the 13th Court of Appeals that would have brought a $4 million payday to class-action attorneys who shepherded the case through two decades of litigation, as well as a second group of attorneys who represented plaintiffs in a separate but related class-action lawsuit.
Texas Supreme Ruling Favors Insurers That Changed Policy Forms to Stem Mold Claims
The Texas Supreme Court on Friday reversed lower court rulings and found that Farmers Insurance was within its rights when it decided 19 years ago not to renew homeowners’ policies that it feared would have forced it to cover mold damage.
The 7-0 decision overturns rulings that required the carrier to renew 400,000 insurance policies that were thought to include coverage for all risks to dwellings, not just named perils. The high court also reversed orders by the 13th Court of Appeals that would have brought a $4 million payday to class-action attorneys who shepherded the case through two decades of litigation, as well as a second group of attorneys who represented plaintiffs in a separate but related class-action lawsuit.
In Hinojos v. State Farm Lloyds, the Supreme Court of Texas addressed liability under the Texas Prompt Payment of Claims Act (the “TPPCA”) when an insurer timely pays only part of a.
Maryland’s highest court adopts pro rata allocation for asbestos-related bodily injury claims under liability policies. The court began by explaining that injury spanning many years often implicates multiple policies and, therefore, implicates a continuous or injury-in-fact trigger under Maryland law. Adopting the reasoning of
Mayor & City Council of Baltimore v. Utica Mutual Ins. Co., 802 A.2d 1070 (Md. Ct. Spec. App. 2002)
, app. dismissed, 821 A.2d 369 (Md. 2003), it rejected joint and several allocation because of its “poor fit” under the policy language:
[T]he pro rata approach is unmistakably consistent with the language of standard CGL policies. Indeed, “there is no logic to support the notion that one single insurance policy among 20 or 30 years worth of policies could be expected to be held liable for the entire time period.” …Consistent with the policy language limiting coverage to that which occurs “during the policy period,” the timing of the injury di
Year in Review: Top Insurance Cases of 2020 Thursday, January 28, 2021
Not surprisingly, COVID-19 business interruption insurance disputes dominated media headlines for most of 2020. Nonetheless, there were a number of other insurance rulings that will undoubtedly shape the coverage landscape. Policyholders enjoyed a number of significant wins including significant victories related to COVID-19 business interruption cases. The start of a new year gives us an opportunity to highlight some of 2020’s most notable coverage decisions.
COVID-19 Business Interruption
Insurance companies’ widespread blanket denials of policyholders’ claims for business interruption due to COVID-19 for companies ranging in size from small mom-and-pop shops to large retailers prompted a flood of litigation in both state and federal courts. Although 2021 shows promise for gaining control over the disease, the resulting insurance disputes are certain to remain center stage. While insurers ma