Category: Uncategorized

For over 100 years, it has been well established under New Jersey law that an insurance broker owes a duty to the insured, its client, to act in good faith and with reasonable skill in performing its services.  That duty, however, is not unlimited.  For instance, absent a “special relationship,” an insurance broker has no… Continue reading When the Levee Breaks: Broker Has No Duty to Recommend Higher Limits

Property insurance policies, like other insurance policies, contain an overall limit of liability, which is the maximum amount that the insurance company will pay for any given loss.  In addition to an overall limit, policies may also contain “sublimits” of liability that apply to certain types of perils or damage.  A sublimit is less than… Continue reading Debris: New Jersey High Court Rejects Stacking of Sublimits

When an insurer pays an insurance claim, it becomes subrogated to the rights of its insured.  The rights of the insurer, however, are no greater than the rights of its insured.  Thus, any defenses that a potentially responsible party could assert against the insured can be asserted against the insurer.  It is not uncommon for… Continue reading Slow Down: Waiver of Subrogation Clause Does Not Bar Claim Against Co-Tenant

Procrastinators put things off until the last minute.  Waiting until “the midnight hour” to take care of important tasks, however, can have some truly negative consequences.  A recent example of this can be found in Megna v. Leading Insurance Services, Inc., 2017 WL 393573 (N.J. Super Ct. App. Div. Jan. 30, 2017).  There, the insureds… Continue reading The Midnight Hour: It’s Too Late to Pay Your Premiums After the Fire has Started

In Givaudan Fragrances Corp. v. Aetna Cas. & Sur. Co., 2017 WL 429476 (N.J. Feb. 1, 2017), the New Jersey Supreme Court held that an anti-assignment clause in an insurance policy does not prevent the post-loss assignment of an insurance claim.  Givaudan dealt with the issue of the assignment of claims under decades-old insurance policies. … Continue reading Can’t Stop This: Anti-Assignment Clause No Bar to Post-Loss Claim Assignment

Cases involving insurance coverage for multiple claims arising out of bodily injury or property damage resulting from exposure to toxic substances or long-term environmental damage can present extremely complex coverage issues.  In such cases, insureds may have insurance coverage spanning many decades under multiple policies issued by various insurers.   In Owens-Illinois, Inc. v. United Ins. Co.,… Continue reading It’s Complicated: Owens-Illinois/Carter-Wallace Allocation Revisited Yet Again

New Jersey passed the Insurance Fraud Prevention Act (“IFPA”) to aggressively address the problem of insurance fraud in New Jersey.  To that end, the IFPA provides for the imposition of both civil and criminal penalties in connection with the commission of insurance fraud.  In State v. Goodwin, 224 N.J.102 (2016),  the New Jersey Supreme Court… Continue reading Your Cheatin’ Heart: Attempt to Hide Affair Results in Seven-Year Prison Term

An insured generally is required to provide its insurer with timely notice of a loss that may be covered under its insurance policy.  Failure to provide timely notice may preclude coverage for the loss.  Under New Jersey law, an insured’s failure to provide timely notice will preclude coverage only if the insurer shows that it… Continue reading It’s Too Late: Notice of a Loss Under a Claims-Made Policy

Insurance policies typically contain what are known as other-insurance clauses.  Other-insurance clauses set forth a methodology for apportioning liability when multiple insurers have issued policies that provide coverage for a loss.  There are three basic types of other-insurance clauses:  pro-rata, escape, and excess.  Deciding how different other-insurance clauses apply is like a game of rock-paper-scissors.… Continue reading Rock-Paper-Scissors: Dueling Other-Insurance Clauses

Application of a particular state’s law can have a significant impact on the determination as to whether a loss is covered.  Given the impact choice-of-law decisions may have, insureds and insurance companies may “forum shop” to pick the jurisdiction most favorable to resolution of their claims.  This is especially true when it comes to a… Continue reading Shop Around: Late Notice and Forum Shopping