Insurance Update

March 9, 2018 | Robert Tugander | Insurance Coverage

Luck, both good and bad, is a theme persistent throughout the month of March.  There’s St. Patrick’s Day and the luck of the Irish.  There’s the cautionary warning “Beware the Ides of March.”  And for college basketball fans, it’s the key ingredient to winning the March Madness office pool.

And it just so happens that luck is a theme that runs throughout our March Insurance Update.

For example, triple sevens – “777” – may be a lucky number if you’re playing the slots.  It’s anything but lucky if you’re a bank and you just lost $7.77 million because your employee allegedly misrepresented the amount of collateral when obtaining approval for certain loans.  The bank looked to recoup its losses under its financial institution bond that covered dishonest acts of employees.  But the insurer that issued the bond refused to pay.   See why and whether the insurer was right in doing so.

Construction lending is a risky venture.   And no matter how careful a lender may be, a little bit of bad luck can ruin the deal for everyone.  Our update includes a case about one of the most litigated clauses in a title insurance policy – an exclusion for liens “created, suffered, assumed or agreed to by” the insured.  The Eighth Circuit considers whether the insured’s intentional misconduct is required for the exclusion to apply.

Bingo is a game that is all about luck.  Planet Bingo was unlucky when one of its gaming devices caught fire and destroyed property in London.  Planet Bingo filed a claim with its insurer.  A dispute arose as to whether the loss was within the coverage territory of the policy.  The California Court of Appeal agreed with the insurer that the definition of “coverage territory” was not ambiguous, that the London loss could be covered only if Planet Bingo’s liability is determined in a suit in the US or Canada, and that no suit had been filed in the US or Canada.  Yet the lower court’s dismissal in favor of the insurer was overturned.  You can decide for yourself if the court’s reasoning was on the mark, or if Planet Bingo was just plain lucky.

If you have been able to avoid telemarketers’ phone calls, consider yourself lucky.  DISH Network was sued under the TCPA on the grounds that its telemarketers violated federal and state laws. In a dispute that reached the Tenth Circuit, the court decides whether claims for statutory damages and injunctive relief give rise to a duty to defend.

Our final case is also from the Tenth Circuit, where the court weighs in on the ongoing debate over whether faulty workmanship can be an “occurrence.”  The court’s ruling is based on its prediction of how the New York Court of Appeals would decide the issue.

Hope you enjoy our update and may luck be on your side.

Click here to read the Update.

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