Third Circuit Holds ERISA Plan Administrator Must Inform Claimant of Plan-Imposed Deadline for Judicial Review in Notification Denying Benefits

In Mirza v. Insurance Administrator of America, Inc., 2015 WL 5024159, (3d Cir. Aug. 26, 2015), the Court of Appeals addressed the principal question of whether under the Employee Retirement Income Security Act of 1974 (“ERISA”), 29 U.S.C. § 1001 et seq. plan administrators must inform claimants of plan-imposed deadlines for judicial review in their notifications denying benefits. 29 C.F.R. § 2560.503-1(g)(1)(iv) provides that when a plan administrator denies a request for benefits, it must set forth a “description of the plan’s review procedures and the time limits applicable to such procedures, including a statement of the claimant’s right to
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NJ Supreme Court Clarifies Amount Owed to Innocent Third Party for Bodily Injury Payment Under Voided “Basic” Auto Policy

The NJ Supreme Court recently examined the amount an insurer issuing a “basic” insurance policy, which was subsequently voided for material misrepresentation in the application for insurance, must pay for a bodily injury claim of an innocent third party. In Citizens United Reciprocal Exchange v. Perez, the Court determined that under New Jersey’s compulsory system of auto insurance, the auto insurer is liable to the innocent third party only for the statutory minimum bodily injury payment in circumstances where the insured elects to add the “basic” policy’s $10,000.00 coverage for third-party bodily injury. Notably, the Court also held that the
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NY Court Holds Injured Third Party Has No Cause of Action for Unfair Claims Practices and Bad Faith in Suit Against Insurer and Claims Examiner

A New York trial court dismissed an action for unfair claims practices and insurer bad faith against an insurer and a claims examiner that was brought by a third-party claimant injured in an auto accident. In Hunter v. Hereford Ins. Co., the Civil Court of Queens County held that plaintiff failed to state a cause of action against the insurer and additionally, as a third party, lacked privity to sue the insurer of the driver that had injured her. The court also dismissed the action against the claim examiner on the basis that she was acting as an agent of
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NJ Supreme Court Declines to Extend Residential Public-Sidewalk Immunity to Homewoners Association (HOA) Privately Owned Sidewalks

Under New Jersey law, commercial property owners have a duty to maintain the sidewalks abutting their properties and can be held liable for injuries occurring on those sidewalks. Residential landowners, on the other hand, do not have the same responsibilities and are immune from claims for personal injuries on residential sidewalks. In the 2011 case of Luchejko v. City of Hoboken, the New Jersey Supreme Court extended residential sidewalk immunity to Homeowners Associations (“HOAs”) for injuries occurring on public sidewalks adjoining residential condominium communities. Recently, the Court addressed the issue of whether this immunity also applies to claims for personal
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New Jersey Appellate Division Says When Dealing With Discovery Dispute Between Insureds and Insurers Over Privileged Documents, In-Camera Review Must Be Conducted and Discovery as to Breach of Contract and Bad Faith Claim Bifurcated

On July 27, 2015, in Alden Leeds v. QBE Specialty Ins. Co., unpublished, No. A-2034-14T1 (App. 2015), the New Jersey Appellate Division rendered an important decision addressing discovery disputes between insureds and insurers over privileged documents. Alden Leeds involved a coverage dispute with QBE Specialty and Certain Underwriters at Lloyd’s, London over whether a fire that destroyed Alden Leeds’s warehouse was a covered fire loss or an excluded flood loss. Alden Leeds, a manufacturer and seller of pool chemicals, stored chemicals in a warehouse insured by QBE and Underwriters. The warehouse was damaged by fire during Super Storm Sandy. The
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NJ Court Permits Jury Trial To Insureds In Fraud Cases

Court OKs Jury Trials for Private Insurance Fraud Defendants Michael Booth, New Jersey Law Journal July 21, 2015 | 0 Comments SHARE PRINT REPRINTS Barry Albin Barry Albin Carmen Natale The New Jersey Supreme Court has ruled that defendants in civil actions brought under the state’s Insurance Fraud Prevention Act (IFPA) have the right to a jury trial. In a unanimous ruling in Allstate Insurance v. Lajara, the court disagreed with two lower courts that said private claims brought under the IFPA are equitable and, therefore, there is no right to a trial by jury. Justice Barry Albin, writing for
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Pennsylvania Supreme Court Adopts New Fair and Reasonable Standard When Insured Settles Without Insurer’s Consent

In an issue of first impression, the Supreme Court of Pennsylvania recently addressed whether an insured forfeits the right to insurance coverage when it settles a lawsuit without the insurer’s consent, in a case where the insurer has defended the suit subject to a reservation of rights. In Babcock & Wilcox v. American Nuclear Insurers, the Court answered that question in the negative and adopted a fair and reasonable standard limited to those cases where an insured accepts a settlement offer after and insurer breaches its duty by refusing a fair and reasonable settlement while maintaining its reservation of rights,
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New York Court Holds Boat Owner Not an Insured Under Policy Issued to Marina That Leased the Owner’s Boat

In Rosano v. Freedom Boat Corp., a boat owner brought suit against a marina and its insurer, American Modern Insurance Group, Inc. (“American Modern”), for damages to the boat he leased to the marina. The owner brought causes of action for breach of contract and failure to pay a claim against American Modern, claiming that he was an insured under the policy issued to the marina. After reviewing the policy language, the United States District Court for the Eastern District of New York held that the owner was not named as an insured or additional insured and entered summary judgment
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North Carolina Federal Court Will Address Builder’s Faulty Workmanship in Coverage Dispute

Nationwide Mutual Insurance Company recently filed a declaratory judgment action in the United States District Court for the Western District of North Carolina to obtain a ruling that its commercial general liability policy does not cover the insured builder for faulty workmanship. In Nationwide Mutual Insurance Company v. Hyde, Nationwide requests a declaratory judgment that coverage is not owed to a builder who was sued by homeowners for property damage that occurred as a result of the insured constructing the home on top of improperly compacted fill soil. The homeowners were awarded $350,000.00 in damages in an underlying suit against
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New York Court Holds Life Insurer Must Pay Claim After Failing to Strictly Comply With Statutory Notice Requirements Regarding Policy Termination

A New York court found that Allstate Life Insurance Company was required to pay the proceeds of a life insurance policy because it had failed to properly notify the insured of the termination of the policy. In Rivera v. Allstate Life Insurance Company of New York, the Suffolk County trial court entered summary judgment in favor of the insured and found as a matter of law that the insurer must pay the $100,000 policy limits for failing to comply with the notice requirements of Insurance Law § 3211. The court noted that its decision was in line with public policy
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