California Insurance Litigation Blog

California Insurance Litigation Blog

Category Archives: Duty to Defend

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General Liability Insurer Has No Duty to Defend Massage Therapist’s Alleged Sexual Assault

Posted in Bad Faith, Commercial General Liability Insurance, Duty to Defend
General liability insurers and their agents often lure commercial clients with grandiose promises of coverage for business operations, but upon receiving a notice of a claim, interpret their policy exclusions liberally to limit what they consider covered business operations so as to deny coverage.  A recent case from the California Court of Appeal, Baek v. … Continue Reading

Policyholder Wins Handed Down in Insurance Decisions. Daily Journal Publishes McKennon Law Group PC Article.

Posted in Breach of Contract, Case Updates, Disability Insurance, Duty to Defend, Duty to Settle, ERISA, Insurance Bad Faith, News, Unfair Business Practices/Unfair Competition
The February 10, 2014 edition of the Los Angeles Daily Journal featured Robert McKennon’s article entitled:  “Policyholder Wins Handed Down in Insurance Decisions.”  In it, Mr. McKennon discusses six insurance decisions handed down in California and federal courts in 2013 that were favorable to policyholders.  … Continue Reading

The Reasonable Expectations of the Covered Party, Even an Additional Insured, Determines the Interpretation of Ambiguous Policy Language

Posted in Case Updates, Duty to Defend, General Liablity, Policy Interpretation
In California, courts have long held that where a policy provision is ambiguous because it is susceptible to multiple interpretations, the reasonable expectation of the covered party governs.  But which parties’ objectively reasonable expectations should govern where there are both a named insured and an additional named insured claiming coverage?  In its significant decision in … Continue Reading

Insurers Have a Duty to Defend at the Outset of Litigation Even If a SIR Has Not Been Exhausted

Posted in Case Updates, Commercial General Liability Insurance, Duty to Defend, General Liablity, Policy Interpretation
Insurers providing general liability insurance cannot shirk their duty to defend insureds at the outset of litigation by relying on self-insured retention (SIR) provisions in those policies unless the policies expressly and unambiguously make the insurer’s duty to defend contingent upon the SIR.  So held the Fourth District Court of Appeals in American Safety Indemnity … Continue Reading

Insurer’s General Reservation of Rights Does Not Entitle Insured to Cumis Counsel

Posted in Commercial General Liability Insurance, Directors & Officers Insurance, Duty to Defend, Policy Interpretation, Property & Casualty Insurance
In a recent ruling, the California Court of Appeal held that an insurer’s general reservation of rights to deny coverage of damages outside its policy does not create a conflict of interest with the insured, such that the insured in entitled to Cumis counsel.  The decision in Federal Insurance Co. v. MBL, Inc. __ Cal. … Continue Reading

Insurers Forfeit Their Protections Under Civil Code Section 2860 (Cumis Statute) When They Fail to Meet Their Duty to Defend Obligations

Posted in Attorneys' Fees, Case Updates, Duty to Defend, General Liablity
If you want to read an important case on Cumis counsel and the consequences to insurers who fail to fulfill their obligations relating thereto, we have one for you.  J.R. Marketing LLC v. The Hartford Cas. Insurance Co., __ Cal.App.4th __ (May 17, 2013).  This case has a lot to offer: Cumis counsel, attorneys’ fees, … Continue Reading

Reasonable Interpretation of Statute Does Not Preclude Triable Issue of Fact on Insurance Bad Faith Claim

Posted in Duty to Defend, Insurance Bad Faith, Property & Casualty Insurance
A recent California Court of Appeals decision sought to clarify the application of California Insurance Code Section 533.5(b) concerning the statute’s preclusion of an insurer’s duty to defend its insured in criminal actions.  In Mt. Hawley Insurance Co. v. Richard Lopez, Jr.,__Cal.App.4th___, 2013 Cal. App. LEXIS 346 (May 1, 2013) the Court of Appeals held … Continue Reading

California Court of Appeal Upholds Insurance Coverage for Health Net Finding The “Dishonest Acts” Exclusion Did Not Preclude Coverage

Posted in Case Updates, Duty to Defend, ERISA, General Liablity
In Health Net, Inc. v. RLI Insurance Company, et al., the California Court of Appeal, Second District, reversed a trial court’s entry of judgment on a Motion for Summary Judgment finding some coverage for Health Net, Inc. (“Health Net”) in connection with numerous lawsuits filed against it arising under the Employee Retirement Income Security Act of … Continue Reading

Insurers May Intervene and Assert the Same Rights as Their Insured’s to Contest Both Liability and Damages

Posted in Case Updates, Commercial General Liability Insurance, Duty to Defend, Property & Casualty Insurance
Under certain circumstances, an insurer has the right to intervene in a case against its insured to protect its own rights and to avoid harm to the insurer.  These circumstances usually involve cases where an insured is either prevented from appearing and defending, or simply chooses not to and a default is taken against the … Continue Reading

Why Does The Pollution Exclusion in California Insurance Policies Exclude Asbestos Building Contamination But Not Pesticide Building Contamination?

Posted in Case Updates, Commercial General Liability Insurance, Duty to Defend, Homeowners Insurance, Insurance Bad Faith, Legal Articles, Policy Interpretation, Property & Casualty Insurance
According to a recent California appellate court decision, a contractor’s negligent release of asbestos fibers during the removal of asbestos-containing acoustical spray in a condominium complex is excluded by the pollution exclusion in a homeowner association’s property and liability policy, despite a 2003 California Supreme Court ruling that a contractor’s negligent spraying of pesticide in … Continue Reading

New ED CA Decision is a Feast of First-Party and Third-Party Insurance Coverage and Bad Faith Principles

Posted in Case Updates, Commercial General Liability Insurance, Duty to Defend, General Liablity, Insurance Bad Faith, Policy Interpretation, Property & Casualty Insurance
Every now and then a court decision comes along that is a virtual one-stop shop for basic insurance coverage and bad faith principles—a primer for newbie insurance attorneys and a refresher for seasoned litigators.  Chief Judge Anthony Ishii’s recent decision granting in part and denying in part an insurer’s motion for summary judgment on a … Continue Reading

California Appellate Court Holds That Theft of Cash Does Not Trigger a Defense or Indemnity for “Loss Of Use” Under a CGL Policy

Posted in Commercial General Liability Insurance, Duty to Defend
Co-written with Associate Joshua Malter In Advanced Network, Inc. v. Peerless Ins. Co., 2010 Cal. App. LEXIS 2078 (Dec. 10, 2010) the California Fourth Appellate District concluded that the theft of $2 million in cash from an insured’s client did not trigger a commercial general liability (CGL) insurer’s duty to defend or indemnify the insured against … Continue Reading

California Supreme Court Extends CGL Insurer’s Duty to Defend “Suits” To An Administrative Proceeding

Posted in Case Updates, Commercial General Liability Insurance, Duty to Defend
In a closely watched case the California Supreme Court recently expanded the scope of a comprehensive general liability insurer’s (CGL) duty to defend “suits” to an adjudicative proceeding before the former United States Department of Interior Board of Contract Appeals (now the Civilian Board of Contract Appeals).  Ameron International Corp. v. Insurance Company of Pennsylvania, … Continue Reading

The Reasonable Expectations Doctrine Finds a New Ground in the Realm of Title Insurance

Posted in Duty to Defend, Insurance Bad Faith
The “reasonable expectations of the insured” doctrine continues to weave its way into all types of insurance coverage cases.  This time, it thrust itself into a title insurance case.  In Karen Lee v. Fidelity National Title Insurance Company,__Cal. App. 4th__ (September 16, 2010), the First Appellate District of the California Court of Appeal found coverage … Continue Reading

In a Case of First Impression, California Court of Appeal Extends the Duty to Defend Under a CGL Policy

Posted in Case Updates, Commercial General Liability Insurance, Duty to Defend, News
Commercial General Liability (“CGL”) policies that cover personal injury and property damage require CGL carriers to defend “suits,” typically defined to mean “a civil proceeding in which damages . . . to which this insurance applies are alleged.”  A question arises as to whether the process prescribed by the Calderon Act (the Calderon Process) is a” civil … Continue Reading

The Continuous Injury Trigger: A Cat-and-Mouse Game

Posted in Commercial General Liability Insurance, Duty to Defend, General Liablity
The Thursday July 17, 2010 edition of the San Francisco Daily Journal featured my article, entitled “The Continuous Injury Trigger: A Cat-and-Mouse Game,” in the Perspective column. It explains a recent case from the California 4th Appellate District which rejected a CGL insurer’s attempts to apply a “double trigger” to narrow the “continuous injury trigger” based on the standard … Continue Reading

California Court Finds Coverage for Patent Infringement Claims Under CGL Policies

Posted in Case Updates, Commercial General Liability Insurance, Duty to Defend
In a case of first impression, the Ninth Circuit Court of Appeals held, for the first time under California law, that patent infringement can be covered as a “misappropriation of advertising ideas” under the advertising injury coverage of a general liability policy, where the patent is on a method of web based advertising. In Hyundai … Continue Reading

Right to Jury Trial Trumps Binding Arbitration When Insurer Unreasonably Delays Paying Independent Defense Counsel

Posted in Case Updates, Duty to Defend, General Liablity, Insurance Bad Faith, News
In an article appearing in the April 12, 2010 editions of the Los Angeles and San Francisco Daily Journals, I discuss the impact of the California Fourth Appellate District’s Intergulf Development, LLC. v. Superior Court (Interstate Fire & Casualty Company). Here it is: In an important vindication of a California policyholder’s right to a jury … Continue Reading

Insurer Seeking Contribution From Another Insurer Must Prove it Paid More Than Its Share of Loss

Posted in Case Updates, Duty to Defend, Fire Insurance, News
When multiple insurers share the same defense obligation, the defense costs are typically allocated equally.  When an insurance company refuses to defend, those insurers which do contribute to the defense may seek contribution from the insurer(s) that do not.   Scottsdale Insurance Co. v. Century Surety Co., __ Cal. App. 4th ___ (March 10, 2010) addresses … Continue Reading

Should an Insured Consider Answering and Cross-Complaining Before Moving to Stay Insurer’s Declaratory Relief Action?

Posted in Duty to Defend, News
When a liability insurer wishes to avoid all coverage obligations with respect to a claim against its insured, it will sometimes file a declaratory relief action requesting a ruling that it has no duty to defend or indemnify the insured.  If the insurer files for such declaratory relief while the underlying litigation is still pending, … Continue Reading

Duty to Defend Triggered by the Peculiar Risk Doctrine

Posted in Auto Insurance, Case Updates, Duty to Defend, News
In Amer. States Ins. v. Progressive Casualty Ins., 180 Cal. App. 4th 18 (2009), the California Court of Appeal addressed the “peculiar risk” doctrine in the context of an insurer’s duty to defend.  Victor Meza was a self-employed truck driver who was hired by Western Trucking LLC (“Western”) as an independent contractor.  While driving a … Continue Reading