Regular readers of this blog know that I often whine about – er, raise persuasive points about – the recent trend in the courts (especially federal courts) to erode the longstanding pro-policyholder rules of insurance policy construction. But the situation goes beyond that. The federal court here in New Jersey is now apparently heightening the pleading standards needed to pursue a claim against an insurance company for wrongful denial of coverage. For years, New Jersey has been a notice-pleading state, meaning that only a short statement of the basis for the policyholder’s claim was necessary ..read more

Mr. Trouble never hangs around, When he hears this mighty sound, “Here I come to save the day!” That means that Mighty Mouse is on the way! Yes sir, when there is a wrong to right, Mighty Mouse will join the fight! On the sea or on the land, He’s got the situation well in hand! –Theme from “Mighty Mouse” (1958) For many years in New Jersey, insurance policyholders were blessed with pro-consumer judges who carefully scrutinized the business practices of insurance companies. Justice Stein’s opinion in Morton Intern. v. General Acc. Ins. Co., 134 N.J. 1 (1993) comes to mind, in which the Court re ..read more

Back in the halcyon days of insurance coverage litigation (before many defense-oriented judges began to view themselves as Guardians at the Gate of the Insurance Industry), New Jersey courts would occasionally hand down landmark decisions to protect the policy-buying public from sharp practices by carriers. One of those decisions was Griggs v. Bertram, 88 N.J. 347 (1982). In New Jersey, you’ll sometimes hear lawyers talk about a “Griggs settlement.” Let’s look at the Griggs case in a little detail to understand what that means. Griggs involved a personal injury claim stemming from a schoolyard ..read more

Very early on, our firm decided not to get involved in the COVID-19 business interruption coverage wars. Our reasons were simple. First, we knew that the insurance industry would treat these claims as a threat to their very existence (or at least would say that to judges in an effort to dodge coverage). Therefore, the claims would be very difficult to settle. To be successful, policyholders and their lawyers would need to commit substantial resources to the battle, probably for a long period of time. So, we advised our clients to file their claims, let others fight the coverage battles, and se ..read more

I seriously don’t know why so many judges have seem to have such a difficult time applying insurance law. Don’t tell anyone, or coverage lawyers like me may have to reduce our hourly rates, but the whole body of insurance law really comes down to Four Simple Rules: Coverage provisions are supposed to be given the broadest reasonable construction in favor of the policyholder. Exclusions from coverage are supposed to be given the narrowest possible construction against the insurance company. As in baseball, ties go to the runner. The policyholder is the runner. So, if there is more than one rea ..read more

If you were born and raised in New Jersey like me, you’ve heard your share of New Jersey jokes from interlopers who think the entire state looks like the Turnpike near Newark Airport. (“What exit?” How wonderfully clever.) My response to these jokes is two-fold. First, trust me on this, we don’t like you, either. Second, we have Springsteen, Sinatra, the Sopranos, the Jersey Shore, three Stanley Cups, and two New York football teams. So, the more important issue is: Why does Delaware even exist? I know, I know, the current President comes from Delaware. And so did George Thorogood. And Valerie ..read more

I’ve been representing policyholders in insurance coverage litigation for 35 years, and I’m convinced that I’ll never understand the logic of insurance company claim departments. They settle cases that I think they might want to fight, and they fight cases tooth-and-nail that I think they really should settle. (Maybe it’s me.) The carrier’s claim file often doesn’t contain the type of rational, detailed analysis I would expect. (I’ve reviewed many in discovery.) Not long ago, I reviewed a claim file in which the carrier’s Vice-President and General Counsel informed the claim department (staffe ..read more

I hesitated to write this blog post, which is intended to be nonpolitical. We’re currently in the middle of an exceedingly nasty election season, and any topic that even remotely touches on politics is likely to lead to online mayhem. But I was intrigued by the confirmation hearings I watched yesterday for President Trump’s Supreme Court nominee, Amy Coney Barrett, especially given an insurance decision that she once wrote. She often says that when she criticizes a judicial decision, she isn’t personally criticizing the judge who wrote it. I am posting this brief article in the same spirit. Wh ..read more

We have a coverage case in the office that’s 15 years old, with no end in sight. The amazing thing is, it’s not even a particularly complicated case. I don’t want to go into too much detail or give the names of the parties, because the matter is still pending. But even if we eventually get the carriers to pay the claim, they’ve won, because they’ve already invested the premium dollars and the potential claim payment, and turned a tidy profit. (By the way, they lost a coverage trial on liability 10 years ago, and since then have been using the concept of appropriate allocation-of-loss to delay ..read more

I promise not to discuss COVID-19 in detail in this post. The recent deluge of hot legal takes about the pandemic may be making a lot of people sicker than the virus itself. So, let’s talk about a different, earlier disaster. Believe it or not, eight years after the winds of Hurricane Sandy struck New Jersey, they’re still blowing through the state’s court system. Recently, the Appellate Division upheld a multimillion-dollar verdict against an insurance brokerage for failing to provide proper advice about storm coverage in advance of Sandy. And while I just promised not to focus on you-know-wh ..read more