Smith Smith & Feeley LLP - Insurance Law News - California Insurance Lawyers

"Actual Cash Value" Amount Listed in Declarations Is Limit, and Does Not Create "Valued" Property Policy

Fri, 27 Jan 2012 18:06:00 GMT

Although a property policy listed an “actual cash value” amount in the declarations, the policy could not reasonably be construed as a “valued” policy, but rather was an “open” policy. (George v. Automobile Club of Southern California (2011) WL 6144927)

2011 Annual Review of California Insurance Law

Mon, 26 Dec 2011 17:28:09 GMT

Review the major cases and statutory changes ranging from December 2010 through November 2011 that will impact your California claims for 2012.

Police Seizure and Destruction of Marijuana Does Not Constitute "Theft" Within Meaning of Homeowners Policy

Fri, 25 Nov 2011 23:21:57 GMT

No “theft” occurred where the police obtained a search warrant, seized and later destroyed the insured’s marijuana. (Barnett v. State Farm General Ins. Co. (2011) 200 Cal.App.4th 536)

Greg Barnett grew numerous marijuana plants in the backyard of his residence, and kept dried marijuana inside his house. Barnett maintained that he was permitted to possess the marijuana for medicinal purposes in accordance with California law.

The local police obtained a warrant authorizing them to search Barnett’s residence and to seize any marijuana found there. The officers searched Barnett’s property, dug up and seized the marijuana plants from Barnett’s backyard, and seized the dried marijuana (and related paraphernalia) from the house.

Product Recall/Withdrawal Coverage Does Not Apply Where Insured's Errors Did Not Cause Contamination or Subsequent FDA Product Advisory

Mon, 24 Oct 2011 19:37:57 GMT

A policy that covered expenses and lost profits arising from the recall or withdrawal of a food product was not triggered where the insured’s errors did not actually cause an E. coli outbreak or a subsequent government product advisory. (Fresh Express Inc. v. Beazley Syndicate 2623/623 (2011) WL 4552455)

"Claims Made" Policy Does Not Cover Claim Made During Policy Period Where Claim Involving "Interrelated Wrongful Acts" Was Made Before Policy Period

Mon, 26 Sep 2011 22:24:40 GMT

A "claims made" directors and officers liability policy did not provide coverage for a claim that was made during the policy period where a claim involving "interrelated wrongful acts" was first made before the policy period. (Feldman v. Illinois Union Ins. Co. (2011) WL 3890981)

"Pollution" Exclusion Eliminates Coverage for First-Party Asbestos Contamination

Thu, 25 Aug 2011 15:17:13 GMT

A first-party “pollution” exclusion eliminated coverage where a contractor caused the release of asbestos inside and outside a building. (The Villa Los Alamos Homeowners Assn. v. State Farm General Insurance Company (2011) WL 3586475)

Deliberate Act Causing Unintended Injury Is Not "Occurrence"

Sun, 24 Jul 2011 18:02:51 GMT

An insured’s deliberate act that caused unintended injury to the claimant was not an “occurrence,” or “accident,” within the meaning of a liability policy. (State Farm General Insurance Company v. Frake (2011) WL 2714179)

Court Has Discretion to Grant Declaratory Relief Before Requiring Insured to Submit Valuation Dispute to Appraisal

Tue, 28 Jun 2011 01:24:10 GMT

Where an insured seeks declaratory relief regarding the interpretation of policy provisions, statutes and regulations pertaining to depreciation, a court has discretion to allow the declaratory relief action to proceed before requiring the insured to submit the issue of valuation to appraisal.(Doan v. State Farm General Ins. Co. (2011) 195 Cal.App.4th 1082)

Where Insurer Satisfies Blue Ridge Requirements For Seeking Reimbursement Of Uncovered Settlement From Insured, Insurer Need Not Also Give Insured "Sufficient Time" To Respond To Insurer's Notice / Offer

Sat, 28 May 2011 20:15:28 GMT

Where a liability insurer satisfied the requirements set forth in Blue Ridge Ins. Co. v. Jacobsen (2001) 25 Cal.4th 489 for seeking reimbursement of an uncovered settlement from an insured, the insurer was not also separately required to give the insured a “sufficient time” to respond to the insurer’s notice of intent to settle / offer to assume the defense. (American Modern Home Ins. Co. v. Fahmian (2011) 194 Cal.App.4th 162)

When Liability Insurer Never Expressly Agrees to Defend Insured and Does Not Pay Defense Fees During, Insurer Cannot Later Invoke Civil Code Section 2860's Arbitration Remedy In Dispute Over Attorneys' Fees

Fri, 29 Apr 2011 02:53:02 GMT

Where a liability insurer issues a preliminary “reservation of rights” letter, but never actually agrees to defend its insured and never actually pays any defense fees during the underlying litigation, the insurer is precluded from invoking Civil Code section 2860’s arbitration remedy in a subsequent dispute over attorneys’ fees. (The Housing Group v. PMA Capital Ins. Co. (2011) 193 Cal.App.4th 1150)