By Sara Dunton on Posted in Breach of Contract,Professional Services,Wrongful ActThe Supreme Court of Vermont has held there is no coverage for breach of contract and intentional torts under an errors and omissions (E&O) liability policy, where all counts of the complaint rested on allegations that the insured used misrepresentations and falsehoods to undermine a competitor, which did not fall within the definition of “professional… Continue Reading
By William Knauss on Posted in Professional Services,Related Claims and associated exclusionsThe United States District Court for the Northern District of Illinois, applying Illinois law, has held that there is no coverage under a professional liability policy where the claim arose out of the same set of facts upon which a separate lawsuit against the insured was filed before the policy incepted. Arch Ins. Co. v.… Continue Reading
By Jessica N. Gallinaro on Posted in Dishonesty Exclusion,Professional ServicesApplying New York law, a Delaware state court has held that an insurer owed its insured a duty to defend because the factual allegations in two underlying lawsuits arguably involved the insured’s performance of “Professional Services” and no exclusion applied to otherwise bar coverage. Steadfast Ins. Co. v. DBI Servs., LLC, 2019 WL 2613195 (Del.… Continue Reading
By Nathan Lovett on Posted in Professional Services,Wrongful ActThe United States District Court for the District of South Carolina, applying South Carolina law, has denied a professional liability insurer’s motion to dismiss, holding that the insured’s alleged conduct could fall within the policy’s definition of “Wrongful Act,” thus giving rise to a duty to defend. Harriman v. Associated Indus. Ins. Co., 2019 WL… Continue Reading
By Ashley-Anne L. Criss on Posted in Professional ServicesThe United States District Court for the Southern District of California has held that a liability insurer had no duty to defend a claim made against an insured arising out of the denial of an employee’s life insurance benefits because coverage was barred by an ERISA exclusion. By Referral Only, Inc. v. Travelers Prop. Cas.… Continue Reading
By Chiara Tondi Resta on Posted in Professional Services,Public Policy prohibition on insuranceThe Ninth Circuit, applying California law, has held that an insurer improperly failed to defend its insured in connection with a lawsuit alleging that the insured engaged in an ongoing mortgage modification fraud scheme, because one count in the lawsuit did not require willful conduct and therefore was not necessarily uninsurable under California Insurance Code… Continue Reading
By Matthew W. Beato on Posted in Professional ServicesA Louisiana federal court has held that settlement of a False Claims Act investigation did not trigger the insuring agreement of a bankers professional liability policy because the claim was not made by a third-party client for acts in rendering or failing to render professional services. Iberiabank Corp. v. Ill. Union Ins. Co., 2019 WL… Continue Reading
By Emily S. Hart on Posted in Allocation,Personal Profit/Advantage exclusion,Professional ServicesThe United States Court of Appeals for the First Circuit, applying Massachusetts law, has affirmed the district court’s holding that a professional services exclusion in a real estate advisory fund’s D&O policy did not excuse the duty to defend a lawsuit brought by an investor in the fund because the allegations at issue were ambiguous… Continue Reading
By Chiara Tondi Resta on Posted in Professional ServicesA Nebraska state court has held that the “professional services” exclusion in the insured municipality’s CGL policy barred coverage for the wrongful conviction and civil rights actions brought against the municipality because its deputy sheriffs and psychologist performed “professional services” when they investigated the underlying crime. Gage County, Neb. v. Employers Mut. Cas. Co., No.… Continue Reading
By Margaret Thomas on Posted in Loss,Professional ServicesThe United States District Court for the Eastern District of Virginia, applying Virginia law, has held that a professional liability policy’s exclusion for “negligent supervision” of funds applied to bar coverage for damages resulting from an insured attorney’s reckless investment of trust assets. ALPS Prop. & Cas. Ins. Co. v. Farthing, 2018 WL 4927366 (E.D.… Continue Reading
By Ashley-Anne L. Criss on Posted in Professional ServicesApplying North Carolina law, the United States District Court for the Middle District of North Carolina has held that an insurer had no duty to defend or indemnify an insured for a qui tam action alleging false Medicaid reimbursement submissions because the suit failed to allege a claim arising out of the rendering of or… Continue Reading
By Edward R. Brown on Posted in Cyber Policies and Issues,Professional ServicesA Florida federal district court has ruled that a claim asserting that an insured’s negligent data security practices led to a payment card breach did not trigger personal injury coverage under a CGL policy. See St. Paul Fire & Marine Ins. Co. v. Rosen Millennium, Inc., No. 6:17-cv-540-Orl-41GJK (M.D. Fla. Sept. 28, 2018). The court… Continue Reading
By Ashley-Anne L. Criss on Posted in Professional ServicesApplying Maine law, the United States Court of Appeals for the First Circuit has held that a professional liability insurer had no duty to defend a physician for claims arising out of his alleged improper accessing of his ex-wife’s medical records on the basis that such action did not constitute the rendering of professional services. … Continue Reading
By Jessica N. Gallinaro on Posted in Professional ServicesApplying California law, the United States Court of Appeals for the Ninth Circuit has held that a professional services exclusion in a D&O policy barred coverage for an underlying lawsuit alleging violations of the federal False Claims Act. Hotchalk, Inc. v. Scottsdale Ins. Co., 2018 WL 2473474 (9th Cir. June 4, 2018).… Continue Reading
By Hume Ross on Posted in Professional ServicesThe United States District Court for the District of Colorado, applying Colorado law, has held that an arbitration award for faulty design and construction was potentially recoverable as “damages” under a professional liability policy, but coverage was ultimately precluded by an unambiguous and broad “Faulty Workmanship” exclusion. Rockhill Ins. Co. v. CFI-Global Fisheries Mgmt., 2018… Continue Reading
By Hume Ross on Posted in Professional ServicesThe United States Court of Appeals for the Tenth Circuit, applying Colorado law, has affirmed that an insurer has no duty to defend a law firm against allegations of overbilling. Evanston Ins. Co. v. Law Office of Michael P. Medved, P.C., 2018 WL 2306871 (10th Cir. May 22, 2018). In so doing, the court recognized… Continue Reading
By on Posted in Professional ServicesA California intermediate court of appeals, applying California law, has held that a life insurance agents E&O policy did not cover a suit by a financial advisor’s clients regarding advice provided to the clients to limit their tax liability. Lindsey Fin., Inc. v. Am. Auto. Ins. Co., 2018 WL 2111979 (Cal. Ct. App. May 8,… Continue Reading
By on Posted in Professional ServicesApplying Virginia law, the United States District Court for the Western District of Virginia has held that an educators professional liability insurance policy did not afford coverage for a lawsuit against an insured school teacher accused of sexually abusing a student. Horace Mann Ins. Co. v. Barney, 2018 WL 1733989 (W.D. Va. Apr. 10, 2018). … Continue Reading
By Edward R. Brown on Posted in Loss,Professional ServicesA New York federal district court, applying New York law, has held that the sending of unsolicited text message advertisements in violation of the Telephone Consumer Protection Act (TCPA) triggered professional services coverage under a Miscellaneous Professional Liability (MPL) policy. Illinois Union Ins. Co. v. US Bus Charter & Limo, Inc., 2018 WL 1193464 (E.D.N.Y.… Continue Reading
By Ashley-Anne L. Criss on Posted in Professional Services,Wrongful ActThe United States District Court for the District of New Jersey has held that an exclusion in a professional liability policy applicable to claims arising out of the failure to effect or maintain any insurance precludes coverage for defense costs incurred in an action against an insured on the basis that the action arose out… Continue Reading
By Emily S. Hart on Posted in Dishonesty Exclusion,Prior Knowledge/Warranty Exclusion,Professional ServicesThe United States District Court for the District of New Jersey has held that allegations that a lawyer and his law firm engaged in a fraudulent insurance scheme to induce payment of personal injury protection benefits while representing clients constituted “Professional Legal Services” under the firm’s professional liability policy, triggering the duty to defend. Arzadi… Continue Reading
By Hume Ross on Posted in Professional ServicesThe Illinois Intermediate Appellate Court, applying Iowa law, has affirmed that a professional liability insurer must provide a defense for an attorney who allegedly mishandled funds that he was holding in escrow related to the plaintiff’s transaction with another company for which the attorney was vice president and legal counsel. Willey v. Minn. Lawyers Mutual… Continue Reading
By Margaret Thomas on Posted in Exclusion lead-in language (Arising out of),Professional ServicesA California appellate court has held that a pipeline owner’s insurer is not entitled to reimbursement of defense costs and settlement payments from the insurer for the staffing agency that supplied personnel to the pipeline because the professional services exclusion in the staffing agency’s policy unambiguously barred coverage. Energy Ins. Mut. Ltd. v. ACE American… Continue Reading
