The Indiana Supreme Court, applying Indiana law, has held that an insured may be entitled to coverage for a ransom payment under a commercial crime policy if the circumstances of the attack “fraudulently caused” the insured to make the payment.  The court also held that the ransom payment resulted “directly” from the use of a computer.  G&G Oil Co. of Ind., Inc. v. Continental W. Ins. Co., 2021 WL 1034982 (Ind. Mar. 18, 2021).
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Continue Reading Indiana Supreme Court Revives Insured’s Case for Ransomware-Related Coverage Under Commercial Crime Policy

In a matter of first impression, a Kentucky appellate court held that the notice-prejudice rule does not apply to claims-made-and-reported policies.  Darwin Nat’l Assurance Co. v. Kentucky State Univ., 2021 WL 1045716 (Ky. Ct. App. March 19, 2021).
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Continue Reading Kentucky Court Holds That Notice-Prejudice Rule Does Not Apply to Claims-Made-And-Reported Policies

Answering a certified question regarding a matter of first impression, the Nevada Supreme Court has held that an insurer is entitled to reimbursement of defense costs expended in defense of an insured where a determination is made that the insurer owed no duty to defend and the insurer has clearly and expressly reserved the right to seek reimbursement in writing.  See Nautilus Ins. Co. v. Access Med, LLC, 2021 WL 936076 (Nev. Mar. 11, 2021) (en banc).
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Continue Reading Nevada Supreme Court Holds Insurer May Recoup Defense Costs

The United States District Court for the District of Columbia, applying District of Columbia law, has held that there is no coverage for three lawsuits filed against an insured company because the lawsuits related to an email demand previously received by the company which it failed to report during the applicable claims made and reported policy period.  The court further held in the alternative that, even if the email was not a “claim,” the company failed to provide notice of the lawsuits under the subsequent policy as soon as practicable and the insurer was entitled to deny coverage under the later policy, without showing prejudice.  Zurich Am. Ins. Co. v. UIP Cos., 2021 WL 602901 (D.D.C. Feb. 16, 2021).
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Continue Reading No Coverage for Three Lawsuits Related to Email Not Timely Noticed; No Showing of Prejudice Required Where Notice Not As Soon As Practicable

A Pennsylvania federal district court has held that a solo practitioner’s legal malpractice policy did not provide coverage for litigation arising out of several disputes with the attorney’s family because the attorney failed to comply with the policy’s notice provision, certain of the disputes did not arise out of the provision of “Legal Services,” and a number of exclusions applied.  American Guar. & Liability Ins. Co. v. Law Offices of Richard C. Weisberg, 2021 WL 915425 (E.D. Pa. Mar. 9, 2021). …
Continue Reading No Coverage Under Legal Malpractice Policy for Solo Practitioner’s Family Disputes

Applying Delaware law, the Delaware Superior Court has held that a bankruptcy trustee’s fraudulent transfer claim constitutes a “Securities Claim” under a D&O policy.  Verizon Commc’ns Inc. v. Nat’l Union Fire Ins. Co. of Pittsburgh, Pa, 2021 WL 710816 (Del. Super. Ct. Feb. 23, 2021).
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Continue Reading Delaware Trial Court Holds that Fraudulent Transfer Claim by Bankruptcy Trustee is a “Securities Claim”

An Illinois appellate court has held that a professional liability insurer has a duty to defend suits seeking only declaratory and injunctive relief, even though the suits did not allege potentially covered damages.  MHM Correctional Servs., Inc. v. Evanston Ins. Co., 2021 WL 689525 (Ill. Ct. App. Feb. 23, 2021).
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Continue Reading Insurer Has Duty to Defend Suits Seeking Only Declaratory and Injunctive Relief

A California federal district court has ruled that an insurer could rescind a professional liability policy because its insured failed to disclose a customer dispute and potential claim in its application for coverage.  Scottsdale Indem. Co. v. Sun Coast Gen. Ins. Agency, 2020 WL 8569410 (C.D. Cal. Dec. 21, 2020).
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Continue Reading Insurer Entitled to Rescind Policy Due to Insured’s Failure to Disclose Contract Dispute and Potential Claim on Application

In answering a certified question from the Ninth Circuit, the Arizona Supreme Court has held that, where the policy contains no duty to defend, the objective reasonableness of an insurer’s decision to withhold consent to settlement is judged from the perspective of the insurer.  Apollo Education Group, Inc. v. National Union Fire Ins. Co. of Pittsburgh, PA, 2021 WL 710224 (Ariz. Feb. 17, 2021).
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Continue Reading Where Policy Contains no Duty to Defend, Reasonableness of Insurer’s Decision to Withhold Consent to Settlement Judged from Insurer’s Perspective

In a much-watched case, the Delaware Supreme Court has held that Delaware law governs a dispute regarding insurance coverage for a federal securities class action under D&O policies issued in California to a California company, where the company was incorporated in Delaware.  RSUI Indemnity Company v. Murdock, 2021 WL 803867 (Del. March 4, 2021).  The Court also held that a breach of the duty of loyalty based on fraudulent conduct is insurable under Delaware law and the policies’ profit/fraud exclusion did not apply.
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Continue Reading Delaware Supreme Court Applies Delaware Law in D&O Coverage Dispute Involving California Company Incorporated in Delaware