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Bad Faith Claims Permitted Against Self-Insured Employers In Iowa – “Fairly Debatable” Defense Precludes Finding This Time

A federal trial court in Iowa confirmed that first-party bad faith claims may be cognizable against both insurers and self-insured employers.  In Spencer v. Annett Holdings, Inc., 905 F.Supp.2d 953 (S.D. Iowa, Nov. 27, 2012), an over-the-road truck driver who was allegedly injured when he slipped and fell off  the back of his flatbed trailer sued his employer, a self-insured trucking company, alleging, among other things, that it acted in bad faith by refusing to pay outstanding medical bills, by denying and delaying necessary medical care and treatment, and by breaching a settlement agreement approved by the Iowa Workers’ Compensation Commissioner.   The trial court stated “[f]irst-party bad faith is an intentional tort that arises in the insurance context due to

Posted in Bad Faith

Ever Had A Common Law Bad Faith Claim Dismissed?

A federal trial court in Tennessee confirmed what has been the law in Tennessee for almost thirty years: no tort of bad faith exists between an insurer and its insured.  In Westfield Ins. Co. v. RLP Partners, LLC, 2013 WL 2383608 (M.D.Tenn. May 30, 2013), the District Court ruled that neither a recent enactment by the state legislature nor a 2012 Tennessee appellate court decision cited by the insured have changed the law. The trial court quickly discredited the insured’s arguments that there is a plausible bad faith claim under Tennessee common law because such “a cause of action was recognized” by a recent legislative enactment or the poor reading of a 2012 Tennessee Court of Appeals opinion, finding that

Posted in Bad Faith

Bad Faith Claims Cannot Be Based Solely On Breach Of Contract And Must Allege More Than Conclusory Allegations

In Merrill v. State Farm Fire and Cas. Co., 2013 WL 588515 (W.D.Pa., Feb 13, 2013), the U.S. District Court for the Western District of Pennsylvania dismissed the insured’s common law bad faith claim because it was based solely on breach of the insurance policy and the insured’s statutory bad faith claim because the conclusory allegations were devoid of any facts and could not survive a motion to dismiss. State Farm found only minor damage to a pipe in the home and estimated $319.45 for repairs, which was below the homeowners’ $500.00 deductible.  The homeowners retained a public adjuster who found damages to be $22,647.00, but their proof of loss did not set forth details and merely stated the origin

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Posted in homeowners’ common law, Uncategorized
Avoiding Insurance Bad Faith
Cozen O’Connor represents insurance clients in jurisdictions throughout the U.S. against statutory and common law first- and third-party extracontractual claims for actual and consequential damages, penalties, punitive and exemplary damages, attorneys’ fees and costs, and coverage payments. Whether bad faith claims are addenda to a broader coverage matter or are central to the complaint, Cozen O’Connor attorneys know how to efficiently respond to extracontractual causes of action. More
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