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Mealey's Insurance

December 15, 2025
Environmental Liability Insurer Breached Duty To Defend In Bad Faith, Judge Says

TACOMA, Wash. — An environmental liability insurer breached its duty to defend its insured in bad faith because an underlying water contamination suit alleges a potential for coverage under the policy at issue and the insurer initially acknowledged that there was a potential for coverage under the policy, a Washington federal judge said in granting the insured’s motion for summary judgment on breach of contract and bad faith claims.
December 15, 2025
COMMENTARY: 2025 Updated Primer On PFAS/Forever Chemical Claims Regulation, Litigation & Insurance Coverage Issues

By Scott M. Seaman and Gar N. Lauerman
December 15, 2025
Bad Faith Claim In Gas Pipeline Rupture Coverage Suit Cannot Proceed, Judge Says

BOISE, Idaho — A bad faith claim alleged against a commercial property insurer in a dispute over coverage for the rupture of a natural gas pipeline cannot proceed because a question of fact exists over whether coverage is owed under the policy, an Idaho federal judge said in partially granting the insurer’s motion for summary judgment.
December 11, 2025
Hard Rock Hotel Collapse Coverage Dispute Dismissed After Settlement Reached

NEW ORLEANS — A federal judge in Louisiana issued an order dismissing a property owner’s breach of contract lawsuit against builders risk insurers seeking additional insured coverage for its $89,877,694 in losses arising from the aftermath of the partial collapse of a Hard Rock Hotel project in New Orleans after being informed the parties reached a settlement.
December 10, 2025
11th Circuit Denies Insured’s Rehearing Petition In Environmental Cleanup Suit

ATLANTA — The 11th Circuit U.S. Court of Appeals on Dec. 9 denied an insured’s petition for rehearing or for rehearing en banc in a contamination cleanup suit stemming from the release of petroleum and other contaminants from an underground storage tank at a gas station operated by the insured and will not reconsider its finding that the insured’s late notice was prejudicial to the insurer.
December 10, 2025
La. Panel Affirms Judgment For Guaranty Association In Hurricane Damage Dispute

GRETNA, La. — A Louisiana appellate court affirmed a lower court judgment for the Louisiana Insurance Guaranty Association (LIGA) and entities and individuals sued over the alleged improper construction of a building that collapsed into another building and destroyed it during Hurricane Ida, finding that there is no evidence that the owners of the collapsed building knew of any defect in it prior to the hurricane.
December 09, 2025
Insurer Waived Right To Object To Insureds’ Civil Remedy Notice, Florida Panel Says

ST. PETERSBURG, Fla. — A trial court erred in granting summary judgment in favor of a homeowners insurer in a bad faith suit stemming from the insureds’ claim for water and mold damage in their home because the insurer waived its right to object to the insureds’ civil remedy notice (CRN) by failing to raise an objection to the CRN when it responded to the CRN, a Florida appellate court said.
December 09, 2025
Panel Remands Insured’s Pollution Liability Suit, Says Jurisdiction Question Exists

NEW ORLEANS — The Fifth Circuit U.S. Court of Appeals remanded an insured’s suit seeking coverage under an environmental site pollution liability insurance policy for the settlement of an underlying personal injury suit stemming from carbon monoxide exposure after determining that it is unclear if federal jurisdiction exists because the insured references a nondiverse defendant in numerous filings despite the parties’ representations that the nondiverse defendant was dismissed or terminated from the suit.
December 09, 2025
9th Circuit Affirms Ruling For Insurer In Bad Faith Suit Arising From Rain Damage

SAN FRANCISCO — The Ninth Circuit U.S. Court of Appeals affirmed a lower federal court’s summary judgment ruling in favor of an insurer in the insured’s bad faith lawsuit arising from damage caused by rain that leaked through a roof, rejecting the insured’s contention that the lower court erred by excluding its expert testimony regarding causation.
December 08, 2025
Review Of Jurisdiction Issue In PFAS Exposure Suit Not Warranted, Insurer Says

WASHINGTON, D.C. — The U.S. Supreme Court should deny an insured’s petition for a writ of certiorari seeking review of the Sixth Circuit U.S. Court of Appeals’ finding that a district court erred in remanding a declaratory judgment claim and retaining jurisdiction over breach of contract and bad faith claims in a dispute over coverage for underlying per- and polyfluoroalkyl substances (PFAS) exposure suits because every other federal appellate court agrees with the Sixth Circuit’s disposition, an insurer says in its Dec. 5 response brief.
December 05, 2025
Insurers Seek Reversal Of Settlement Ruling In Imerys, Cyprus Mines Bankruptcies

PHILADELPHIA — Allowing asbestos talc debtors Imerys Talc America Inc. and Cyprus Mines Corp. to enter into a $280 million settlement with talc seller Johnson & Johnson (J&J) for a dispute over indemnification rights for defense of asbestos personal injury claims without paying the debtors’ insurers anything for their subrogation rights “is not only contrary to well-established insurance law, but also counter to strong public policy regarding the nature and purpose of insurance,” the insurers say in their opening brief in their appeal in the Third Circuit U.S. Court of Appeals.
December 04, 2025
Insurer-Insured Debate Postjudgment Interest After Asbestos Award

NEW ORLEANS — An insurer in a Dec. 3 response asks for clarification of the period for which insured seeks prejudgment interest after a federal judge in Louisiana entered final judgment for an asbestos defendant on a $338,000 breach of contract claim.
December 04, 2025
Parties Dispute Scope Of Arbitration In Reinsurance Legionnaires’ Suit

DETROIT — Following a motion hearing, a reinsured entity and the defendants in a lawsuit over claims related to Legionnaires’ disease filed supplemental briefs in a Michigan federal court addressing the defendants’ motion to dismiss, with the defendants asserting that the reinsured entity’s claims arise out of a governing arbitration clause and must be stayed under federal law, and the reinsured entity countering that the dispute falls outside that provision because the assignee is not a party to the operative reinsurance agreement.
December 02, 2025
No Defense, Indemnity Owed For Underlying Silica Dust Exposure Suits, Insurer Says

MINNEAPOLIS — A commercial liability insurer says in a complaint filed in Minnesota federal court that it owes no duty to defend or indemnify its insured against underlying bodily injury suits stemming from exposure to silica dust emitted from the insured’s quartz products because its policies’ pollution exclusions bar coverage for the underlying suits.
December 02, 2025
No Coverage Due Under Pollution Liability Policy For Underground Contamination

KANSAS CITY, Mo. — No coverage is afforded for underground contamination discovered at an insured car dealership because the pollution liability policy at issue provided coverage only for the release of pollutants above ground, a Kansas federal judge said in granting the insurer’s motion for summary judgment.
December 02, 2025
Fungi Exclusion Bars Coverage For Underlying Mold Contamination Suit, Judge Says

EAST ST. LOUIS, Ill. — A commercial general liability insurer has no duty to defend or indemnify its insureds for an underlying suit stemming from mold contamination in a rental apartment because the policies’ bacteria or fungi exclusion clearly precludes coverage for the underlying suit, an Illinois federal judge said in granting the insurer’s motion for judgment on the pleadings.
December 01, 2025
Defective Construction Exclusion Does Not Bar Coverage For Water, Mold Damages

SAN FRANCISCO — A California federal judge granted summary judgment in favor of insured homeowners on a breach of contract claim after determining that an all-risk policy provides coverage for rainwater intrusion and additional living expenses incurred as a result of mold contamination in the insureds’ home because rainwater, a covered loss, rather than defective construction, an excluded cause of loss, was the “efficient proximate cause” of the insureds’ loss.
December 01, 2025
Panel: Court Erred In Denying Homeowners Insurer’s Motion To Dismiss Bad Faith Suit

HOUSTON — A state trial court erred in denying a homeowners insurer’s motion to dismiss claims alleging violations of the Texas Insurance Code and bad faith because the insureds’ causes of action against the insurer were barred based on the insurer’s payment of an appraisal award, the First District Texas Court of Appeals said in vacating the trial court’s order.
November 25, 2025
Judge Denies Homebuilder’s Motion To Sever, Finds Claims Address Same Questions

AUSTIN, Texas — A federal judge in Texas denied a homebuilder’s motion to sever claims in a case in which the homebuilder alleges that its general liability insurer breached their contract by denying coverage for underlying construction defect claims and refusing to participate in settlement negotiations related to the underlying claims, finding no reason to apply different reasoning to separate claims.
November 25, 2025
Insurer Seeks To Recover More Than $20M From Pool Chemical Manufacturer

ATLANTA — An insurer filed suit in Georgia federal court, seeking to recover more than $20 million it paid on behalf of its insureds for damages caused by toxic chemicals released when an explosion occurred at a manufacturing facility near the insureds’ facility.
November 25, 2025
Insurer Says No Coverage Owed For Underlying Mold Contamination Suit

LOS ANGELES — No coverage is owed to an insured for an underlying bodily injury suit stemming from exposure to mold in the insured’s home because coverage is excluded pursuant to the policy’s fungus exclusion, a homeowners insurer says in a complaint filed in California state court.
November 25, 2025
Questions Of Fact Exist On Cause Of Corrosion Damage, Appellate Court Says

CHARLESTON, W.Va. — The West Virginia Intermediate Court of Appeals reversed a lower court’s final judgment in a coverage dispute over damage caused by the release of liquefied chlorine from a railroad tank car after determining that questions of fact exist regarding the “efficient proximate cause” of corrosion damage to the tanker.
November 25, 2025
HVAC System Replacement Proposal Properly Excluded From Jury, Panel Says

PITTSBURGH — A trial court properly excluded a proposal for the replacement of an insured’s heating, ventilation and air conditioning (HVAC) system, allegedly contaminated with mold and asbestos, because the jury considered the same information about the HVAC system that the insured claims was incorrectly precluded by the court, a Pennsylvania Superior Court panel said in affirming the trial court’s decision.
November 25, 2025
Fact Issues Exist On Cause Of Water Damage, California Panel Says In Reversing

LOS ANGELES — The Second District California Court of Appeal reversed a trial court’s summary judgment ruling in favor of an insurer on breach of contract and bad faith claims in a dispute over coverage for water damage in the insured’s home after determining that questions of fact exist over whether a windstorm or wear and tear caused a hole in the home’s roof that resulted in water entering the home.