SEPTEMBER 2014 BAD FAITH CASES: INSURER’S ARGUMENTS THAT BAD FAITH STATUTE DID NOT ENCOMPASS POLICY SOLICITATION CONDUCT OR POST-CLAIMS UNDERWRITING WERE INAPPOSITE WHERE INSURED ALLEGED THAT INSURER USED ALLEGEDLY FRAUDULENT APPLICATION FORMS AS A BASIS TO DENY COVERAGE (Western District)

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In Fields v. Gerber Life Insurance Company, the case involved an out-of-state insurer licensed to sell endowment life insurance policies, marketed as college savings plans,…

MAY 2014 BAD FAITH CASES: COURT DENIES MOTION TO DISMISS BAD FAITH CLAIM AGAINST HEALTH INSURER WHERE POLICY WAS RESCINDED ON BASIS OF ANSWER TO QUESTION IN APPLICATION THAT WAS NOT CLEARLY MATERIAL TO THE DISEASE FOR WHICH THE INSURED WAS BEING TREATED, AND DISCOVERY INTO BASIS FOR RESCISSION WAS NEEDED; UTPCPL CLAIM DISMISSED UNDER ECONOMIC LOSS DOCTRINE (Middle District)

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In Muckelman v. Companion Life Insurance Company, the insured brought claims against his health insurer. The insured was treated for cancer during the policy period,…

JUNE 2013 BAD FAITH CASES: COMPLAINT WAS LEGALLY SUFFICIENT TO SURVIVE MOTION TO DISMISS FOR DENIAL OF COVERAGE FOR CLAIMS ARISING FROM DEFAULTED MORTGAGE LOANS VIEWED AS POST-CLAIM UNDERWRITING; AND USE OF 5 EXEMPLARY INCIDENTS OUT OF NEARLY 250 DISTINCT EVENTS LEGALLY SUFFICIENT (Western District)

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The court considered whether pleadings alleging bad faith conduct in the handling of claims arising from the mortgage crisis were legally sufficient. Plaintiff is a…