Tag archives: US

The tale of the unluckiest yacht – why you need insurance

By Patrick Bracher (ZA) on March 27, 2023 Posted in Insurance

A US case between an insured and an insurer involved the tale of the unluckiest yacht and the series of unfortunate events that she encountered. In January 2013 a new expertly designed custom built yacht Fearless was insured for a year. Two days later she struck a submerged rock in the US Virgin Islands. In … Continue reading

Insurers lose subrogation rights due to underlying contract waiver (US)

By Patrick Bracher (ZA) on March 10, 2023 Posted in Insurance

After paying about $80 million for claim for an explosion and fire that damaged the glass furnace and associated equipment of the insured’s glass manufacturing plant, the insurers unsuccessfully attempted to pursue subrogation claims against the defendant-contractors who were allegedly responsible for the incident because of negligence and breach of contract. The loss was in … Continue reading

Beware of Accidental Cyber Coverage

By Keaoleboga Molefe on February 1, 2023 Posted in General

A US appeals court reversed a judgment of the lower court which had declined to read-in cyber coverage in a commercial general liability policy. The insured operated retail properties and took out a commercial general liability policy (“the CGL Policy”) with the insurer. During the periods of May 2014 and December 2015 the insured’s credit … Continue reading

Insurance indemnity denied because insured withheld material financial information (US)

By Patrick Bracher (ZA) on January 24, 2023 Posted in Insurance

The insured sought loss of hire coverage from various US and London insurers claiming in part that its factory processing vessel was unable to process fish in Alaska because of engine damage. The court held that the insured had breached an express duty to cooperate by withholding from the adjuster’s historical financial information, thus discharging … Continue reading

Data is not tangible property for the purposes of a property insurance policy (US)

By Patrick Bracher (ZA) on October 10, 2022 Posted in Insurance

The claim arose from efforts to recover gold from the wreck of the SS Islander which sank off the coast of Alaska in 1901 carrying gold valued at the time at $6 million. One party to a joint venture recovery company withheld computer data, photographs, videos, imaging, readings, logs and journals downloaded on a media … Continue reading

Downing of Flight 17 by Russian-backed separatists was ‘insurrection’ under war exclusion (US)

By Patrick Bracher (ZA) on October 5, 2022 Posted in Insurance

The family of a student, who died in 2014 when the Donetsk People’s Republic, a Russian-backed separatist group in eastern Ukraine, shot down Malaysia Airline’s Flight 17, sued Western Union for damages for “providing ongoing and essential financial support to the DPR by facilitating money transfers”. The court held that Western Union could not recover … Continue reading

Cover ‘afforded’ by umbrella policy means cover ‘provided’ (US)

By Patrick Bracher (ZA) on October 3, 2022 Posted in Insurance

The insured sought cover under a catastrophe umbrella policy when a claim under the underlying policies had been dismissed for late notice. The umbrella policy covered “any claim alleging bodily injury, personal injury or property damage, insurance for which is not afforded by the underlying policies”. The court held that the word “afforded” in the … Continue reading

Mould damage from burst pipe not caused ‘solely’ by mould (US)

By Patrick Bracher (ZA) on September 30, 2022 Posted in Insurance

A burst boiler pipe at a hotel resulted in mould damage to the property. An exclusion stated “damage caused solely by mould is not covered under this policy”. The court found that the language “caused solely by” indicates a distinction between mould as a loss and mould as a cause of the loss. The triggering … Continue reading

Insurance professional services exclusion applies to a sleep study company (US)

By Patrick Bracher (ZA) on August 29, 2022 Posted in Insurance

A Georgia US court found that the insurer did not have to defend a sleep study company from a negligent suit by the family of a deceased patient because a professional services exclusion applied to the claims in the underlying action. The company conducted sleep studies for its patients and sought an indemnity from the … Continue reading

Insurers not liable for shareholder claim for listeria outbreak (US)

By Patrick Bracher (ZA) on August 29, 2022 Posted in Insurance

A creamery was sued by shareholders who allege that the company’s share price declined because the executives breached their fiduciary duty by continuing to allow the company to produce and distribute ice cream when knowing that some products tested positive for listeria. The policy did not cover a shareholder lawsuit claiming financial harm but only … Continue reading

All risks claimant is required by law to prove cause of event for insurance claim (US)

By Patrick Bracher (ZA) on July 5, 2022 Posted in Insurance

The claimant was insured under an all-risks insurance policy covering a vessel. The policy did not cover engine damage unless an accidental external event caused the damage. The vessel suffered catastrophic engine failure. The court held that the insured had to come forward with evidence that an external event caused the engine damage and the … Continue reading

US Court allows regulator to proceed with “shadow trading” claim as insider trading

By Patrick Bracher (ZA) on June 3, 2022 Posted in General

A San Francisco Court held that an executive may be held liable for “shadow trading” namely trading in securities of a similarly situated competitor’s shares while in possession of insider information about his own company. The defendant was a senior director of business development at a pharmaceutical company bound by the company’s insider trading policy. … Continue reading

Damages for data breach require actual harm (US)

By Patrick Bracher (ZA) on June 1, 2022 Posted in General

A New York Court dismissed the claim by two former employees against their professional services firm based on an alleged failure to protect their personal information in a data breach. The court held that a claimant for damages in these circumstances must prove actual harm. The employees’ had only speculated as to whether they might … Continue reading

Baby-sitting may be a “business” under an insurance policy exclusion and a word on ambiguity (US)

By Patrick Bracher (ZA) on May 23, 2022 Posted in Insurance

Baby-sitting may be a “business” under an insurance policy exclusion and a word on ambiguity (US) In a tragic incident, a baby-sitter who received $25 per day when she provided home daycare services, was caring for a deceased infant who died while in her care from bedding asphyxia. It was held that the baby-sitter did … Continue reading

Insurer’s refusal to pay excess body shop storage fees upheld (US)

By Patrick Bracher (ZA) on May 20, 2022 Posted in Insurance

Insurer’s refusal to pay excess body shop storage fees upheld (US) A Massachusetts Appeals Court refused to allow a class action against an insurer accused of deducting excess body shop storage fees for vehicles deemed total losses because the policy wording permitted the deduction. Under the policy, the insurer agreed to pay for “reasonable expenses … Continue reading

Insurance and meaning of self-insured retention (US)

By Donald Dinnie on April 6, 2022 Posted in Insurance

A self-insured retention is the amount of loss that a policyholder must pay out of pocket before coverage kicks in. In this judgment Colonial Pipeline Company v AIG Specialty Insurance Company, 1:19 –cv-762-MLB (US District Court Georgia, the policy included a US$10 million self-insured retention. The insurer would “pay covered Loss, in excess of the … Continue reading

Ambiguity and bad grammar

By Donald Dinnie on January 5, 2022 Posted in Interpretation

Bad grammar does not necessarily render a contract ambiguous. That was the sensible conclusion of this United States judgment. Hall sued her former employer, Rag-O-Rama when it fired her less than a year after promoting her to an area-manager position. A poorly drafted sentence in the employment contract recorded: “Hall is reminded of the non-competition clause … Continue reading

US jury rejects restaurant Covid-19 insurance claim

By Donald Dinnie on October 29, 2021 Posted in Insurance

Readers who have been following the Covid-19 business interruption litigation in the USA will know that the courts have largely, at summary judgment stage, dismissed claims for coverage alleging that the virus caused physical damage to insured premises. That question has been now been pronounced upon by a jury trial. A Missouri Federal jury considered … Continue reading

Misrepresentation inducing a contract is not a breach excluded by the contractual exclusion clause in a policy (US)

By Patrick Bracher (ZA) on August 4, 2021 Posted in Insurance

A US court found that the exclusion in an insurance policy against losses arising out of or involving a breach of contract or agreement did not exclude a claim resulting from a misrepresentation that induced the contract. The insurer was excused from paying the amount of an arbitration award arising from a business dispute which … Continue reading