Articles Posted in Insurance Law

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The business-owners liability insurance policy in this case did not provide coverage for a negligent supervision claim arising out of an alleged employee’s intentional act of physically punching a customer in the face. The circuit court granted summary judgment in favor of the Insurer, concluding that there was no coverage under the policy for either the employee’s intentional act or the negligent supervision claim against the employer arising out of the employee’s intentional act. The court of appeals reversed. The Supreme Court reversed, holding that where the negligent supervision claim pled rested solely on the employee’s intentional and unlawful act without any separate bais for a negligence claim against the employer, no coverage existed. View "Talley v. Mustafa" on Justia Law

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The business-owners liability insurance policy in this case did not provide coverage for a negligent supervision claim arising out of an alleged employee’s intentional act of physically punching a customer in the face. The circuit court granted summary judgment in favor of the Insurer, concluding that there was no coverage under the policy for either the employee’s intentional act or the negligent supervision claim against the employer arising out of the employee’s intentional act. The court of appeals reversed. The Supreme Court reversed, holding that where the negligent supervision claim pled rested solely on the employee’s intentional and unlawful act without any separate bais for a negligence claim against the employer, no coverage existed. View "Talley v. Mustafa" on Justia Law

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The Supreme Court reversed the judgment of the court of appeals affirming the circuit court’s grant of summary judgment to Plaintiffs’ underinsured motorist (UIM) carrier, Allstate Property and Casualty Co. (Allstate), holding that the court of appeals erred in concluding that Plaintiffs failed to provide Allstate with timely notice of the UIM claim and that they failed to rebut the presumption that Allstate was prejudiced by the untimely notice. Specifically at issue in this case was whether the court of appeals misinterpreted the UIM policy’s “proof of claim” provision as a “notice of accident” provision. The Supreme Court held (1) the operative event triggering the notice requirement in Plaintiffs’ UIM is the tender of the tortfeasor’s underlying policy limit, not the accident itself; (2) Wis. Stat. 631.81(1) does not apply to the UIM policy provision at issue; and (3) therefore, Plaintiffs provided Allstate with timely proof of their UIM claim as required by the policy. The Court remanded the case to the circuit court for further proceedings. View "Shugarts v. Mohr" on Justia Law

Posted in: Insurance Law

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Plaintiff, the insured of Dairyland, sustained bodily injury and property damage while operating his motorcycle. After paying plaintiff all proceeds to which he was entitled under the Dairyland policy, and after plaintiff had settled with the tortfeasor's insurer, Dairyland sought and obtained subrogation from the tortfeasor's insurer for the property damages that it previously paid to plaintiff. Plaintiff then demanded Dairyland pay him the funds it obtained on its subrogation claim. When Dairyland refused, plaintiff filed suit for breach of contract and bad faith. The court concluded that the made whole doctrine does not apply to preclude Dairyland from retaining the funds it received from its subrogation claim because the equities favor Dairyland: (1) Dairyland fully paid plaintiff all he bargained for under his Dairyland policy, which included the policy's limits for bodily injury and 100% of plaintiff's property damage; (2) plaintiff had priority in settling with the tortfeasor's insurer; and (3) if Dairyland had not proceeded on its subrogation claim, plaintiff would have had no access to additional funds from the tortfeasor's insurer. The court also concluded that Dairyland did not act in bad faith. Accordingly, the court reversed the court of appeals decision in all respects. View "Dufour v. Progressive Classic Ins. Co." on Justia Law

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Water Well, which was insured under a commercial general liability primary policy (CGL policy) with Consolidated Insurance Company, was sued by Argonaut Insurance Company. The complaint alleged that Water Well and its employees were negligent in the installation and reinstallation of a water pump and breached their contractual obligations. Water Well tendered its defense to its insurer. Consolidated denied Water Well’s defense tender, stating that it had no duty to defend or indemnify Water Well under the CGL policy. After settling with Argonaut, Water Well filed suit against Consolidated, alleging that Consolidated breached its duty to defend Water Well in the action initiated by Argonaut. The circuit court granted summary judgment in favor of Consolidated, concluding that “there is no covered claim and therefore there was no duty to defend.” Applying the four-corners rule, the court of appeals affirmed. The Supreme Court affirmed, holding (1) Water Well’s request to craft a limited exception to the four-corners rule is rejected; and (2) Consolidated did not breach its duty to defend Water Well because certain exclusions in the CGL policy eliminated coverage. View "Water Well Solutions Serv. Group Inc. v. Consolidated Ins. Co." on Justia Law

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From 2007 to 2009, a number of lawsuits involving Plaintiff, the trustee of two trusts, were filed throughout the country. Plaintiff asked his professional liability insurer, Houston Casualty Company, to defend him in the lawsuits. Houston Casualty determined that it had no obligation to either defend or indemnify Plaintiff in connection with any of the lawsuits. Plaintiff filed a complaint against Houston Casualty alleging, inter alia, breach of the duty to defend and bad faith. The circuit court granted summary judgment in favor of Houston Casualty, concluding that the insurer had not breached its duty to defend Plaintiff. The court of appeals affirmed. The Supreme Court affirmed, holding that the complaints and counterclaim against Plaintiff did not allege facts which, if proven, would constitute claims covered under the policy Houston Casualty issued to Plaintiff, and therefore, Houston Casualty did not breach its duty when it refused to defend Plaintiff in the lawsuits at issue. View "Marks v. Houston Cas. Co." on Justia Law

Posted in: Insurance Law

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The complex insurance coverage dispute arose out of a 2007 fire that destroyed portions of a home that was still under construction. Fontana Builders, Inc., the construction contractor, and James and Suzy Accola, the occupants/presumptive purchasers, had separate insurance policies. The Accolas settled with Chubb Insurance Co., the insurer that provided their homeowner’s policy. Assurance Company of America, which had issued a builder’s risk policy to Fontana, denied all coverage for the fire. Fontana commenced this action against Assurance alleging breach of the insurance contract and bad faith failure to pay under the policy. Fontana’s lender, AnchorBank, FSB, eventually intervened. After a retrial, the jury found that the Assurance policy did not provide coverage for Fontana’s fire loss, concluding that the Chubb policy “applied” to the underlying facts so as to terminate Fontana’s builder’s risk coverage. The court of appeals affirmed. The Supreme Court reversed, holding that that the homeowner’s policy issued by Chubb to the Accolas did not apply so as to terminate Fontana’s builder’s risk policy from Assurance. Remanded. View "Fontana Builders, Inc. v. Assurance Co. of Am." on Justia Law

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Kenneth Burgraff was injured when an employee of Menard, Inc. loaded materials onto Burgraff’s trailer using a forklift. Burgraff sued Menard for damages. Burgraff’s vehicle and trailer were insured under a policy issued by Millers First Insurance Company. Millers First agreed to defend Menard under the policy as a permissive user of Burgraff’s vehicle. Menard was also insured for excess coverage under a commercial general liability policy that included a self-insured retention endorsement. Millers First eventually settled Burgraff’s claim for $40,000, after which Millers First withdrew its defense of Menard. The circuit court determined that Menard’s self-insured retention was “other applicable liability insurance” under the Millers First policy’s “other insurance” clause. The court of appeals affirmed the trial court’s determination that Menard’s self-insured retention was “other insurance” and reversed the circuit court’s determination that Menard no longer had a duty to defend. The Supreme Court affirmed, holding (1) under the terms of the policy, Millers First was required to provide a defense for Menard until it paid its $100,000 limit of liability and breached its duty to defend when it withdrew its defense of Menard; and (2) Menard’s self-insured retention is “other insurance” under the Miller’s First policy’s “other insurance” clause. View "Burgraff v. Menard, Inc." on Justia Law

Posted in: Insurance Law

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Acuity, A Mutual Insurance Company and Chartis Specialty Insurance Company both issued liability policies to Dorner, Inc, a construction company. The Chartis policy was a contractors’ pollution liability (CPL) policy, and the Acuity policy was a Comprehensive General Liability (CGL) policy. Acuity defended and indemnified Dorner in four lawsuits seeking recovery for bodily injury and property damage caused by a natural gas-fueled explosion and fire, which occurred after Dorner’s employees damaged an underground natural gas pipeline during an excavation project. Acuity sought reimbursement from Chartis, asserting that Chartis’s CPL policy provided coverage for Dorner in these lawsuits. The circuit court entered summary judgment in favor of Acuity and ordered Chartis to share with Acuity one-half the cost of defending and indemnifying Dorner. The court of appeals reversed, concluding that the claims asserted against Dorner were not covered under the CPL policy. The Supreme Court reversed and remanded to the circuit court to reinstate the judgment in favor of Acuity, holding that Chartis’s CPL policy covered Dorner’s liability arising from the natural gas-field explosion and fire. View "Acuity v. Chartis Specialty Ins. Co." on Justia Law

Posted in: Insurance Law

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Wisconsin’s notice-prejudice statutes provide that an insured’s failure to furnish timely notice of a claim as required by the terms of a liability policy will not bar coverage unless timely notice was reasonably possible and the insurer was prejudiced by the delay. Plaintiffs sued their former attorney (“Attorney”) for legal malpractice. Attorney’s professional liability insurer ("Insurer") intervened in the lawsuit and sought summary judgment declaring that the insurance policy it issued to Attorney did not cover Plaintiffs’ suit. At issue in this case was whether the notice-prejudice statutes superseded Insurer’s policy requirement that claims be reported during the policy period. Plaintiffs’ claim against Attorney was made during the policy period, but Attorney did not report the claim during the policy period. The circuit court granted the Insurer’s motion for summary judgment, but the court of appeals reversed. The Supreme Court reversed, holding that the notice-prejudice statutes did not supersede Insurer’s policy requirement that claims be reported within the policy period. View "Anderson v. Aul" on Justia Law

Posted in: Insurance Law