Policyholders, don’t lose track of the appraisal provision in your insurance policies. At least that is what the panel in 50 Exch. Terrace LLC v. Mt. Vernon Specialty Ins. Co. seemed to be saying. There, the Ninth Circuit Court of Appeals affirmed the district court’s dismissal of policyholder-plaintiff’s case for non-payment of policy benefits due to lack of ripeness and standing.
Considering the complex structure of commercial insurance programs—typically purchased in annual “towers” of insurance—risk managers and in-house counsel often do not pay sufficient attention to arbitration-related provisions, which the insurance industry is more frequently including in its policies. That’s like playing only one board in a game of three-dimensional chess. Discrepancies among such provisions can lead to obstacles policyholders later must surmount when coverage disputes arise. This article highlights critical issues to consider and offers recommendations to avoid these obstacles wherever possible.
As of January 13, Southern California’s ongoing wildfires have reportedly destroyed more than 12,000 structures. Insured loss estimates exceed $25 billion, and the strong Santa Ana winds fanning the blazes are expected to continue into Wednesday.
Contra proferentem is a foundational legal principle with particular importance in insurance law. It mandates that any ambiguities in an insurance policy are construed against the insurer and in favor of the insured. The doctrine recognizes that insurance policies generally are contracts of adhesion, in which the insurer wields the “power of the pen,” and the insured is invited to accept the terms of the pre-written agreement with little to no alteration. Contra proferentem mitigates the inherent inequality of an arrangement where insurers generally have sole drafting authority and insureds, often with limited bargaining power, must accept the insurers’ terms as written. By resolving ambiguities in those terms against the insurer, courts are able to counterbalance some of this inequity and find coverage for policyholders.
Over the past decade, technological innovations have quickly transformed how companies operate their IT infrastructure. Traditional on-site servers and hardware have often been replaced or supplemented by off-site solutions such as cloud computing, SaaS (Software-as-a-Service), virtualized servers, or “Bring Your Own Device” (BYOD) programs. These developments allow a business’s IT operations to be spread across a complex IT ecosystem rather than confined to physical devices located on its premises. They have the potential to reduce costs while expanding the computing capabilities at a company’s fingertips.
Just as the oilfield fuels the modern economy, master service agreements (MSAs) fuel the modern oilfield. But while almost every MSA contains indemnity and insurance clauses, experienced oilfield lawyers will advise their clients that no two are identical. Determining how these unique contractual provisions apply to losses and interact with available liability coverage is a nuanced process that frequently results in litigation.
In the last few years, the video game industry has been hit with lawsuits accusing certain games of fostering addictive behaviors, especially among younger players. These lawsuits often cite features like loot boxes, microtransactions, and reward systems, which are designed to enhance player engagement, as in-game mechanisms that push players toward compulsive play and psychological harm. Plaintiffs claim that game developers either knew or should have known about these potential risks and failed to mitigate them.
In the aftermath of two powerful hurricanes the process of assessing the damage and rebuilding begins. Businesses suffered billions of dollars in losses during hurricanes Helene and Milton, both in physical property damage and disruption of their business (i.e., lost profits). That is precisely why businesses purchase property and other commercial insurance—to indemnify them when disaster strikes. However, it is not uncommon for businesses to be unpleasantly surprised when they present a claim to discover that their insurers are unwilling to stand behind the full insurance coverage they promised. This is particularly so in the case of a substantial loss, and even more so in the aftermath of a wide-area catastrophe—such as a hurricane or other natural disaster—because such catastrophes have negative repercussions on insurers given the number of impacted policyholders.
This article highlights eight property adjustment and coverage issues. Understanding and being thoughtful about these issues now, including working with coverage counsel as appropriate, is critical to maximizing insurance recovery.
Hurricane Helene struck Florida’s Big Bend region as a category 4 hurricane on September 25, 2024, and continued to move northeast. The storm caused widespread power outages and catastrophic damage across Florida, the Carolinas, Tennessee, Georgia and other states. It has brought life-threatening storm surges in its aftermath. Now, less than two weeks later, Hurricane Milton is making its way toward Florida’s western coast and threatens to cause additional catastrophic damage.
