Court of Appeals Spells Out Claims Settlement Rules for Insurers and Unfair Trade Practices
In Martini v. Companion Property & Casualty Insurance Co., decided yesterday, the court of appeals considered the issue of when an insurer engages in unfair trade practices in connection with claims settlement.
Section 58-63-10 of the General Statutes defines unfair practices by insurance companies but doesn?t, in itself, create a private right of action. The courts have ruled, however, that violations of the insurance statute also violate N.C.G.S. § 75-1.1 which does provide for a private right of action.
In Martini, the plaintiff alleged that the auto insurer engaged in unfair claims settlement practices by refusing to pay a claim without conducting a reasonable investigation in violation of N.C.G.S. § 58-63-15(11)(d).
The court of appeals reversed summary judgment in favor of the insurer based on plaintiff?s contention that the insurance company?s failure to speak directly with the plaintiff before denying the claim constituted an incomplete investigation and that the company's continued denial ? after receiving plaintiff?s explanation on a critical issue ? and failure to follow its own claims handling guidelines also was an unfair trade practice.
Judge Steelman dissented on the grounds that the reversal was based solely on allegations in plaintiff?s unverified complaint as opposed to record evidence.
Structured Settlement Best Practices Corner Click here to be linked to the Structured Settlements Best Practices Corner, a random collection of observations about the laws that govern the conduct of settlement professionals and structured settlement consultants and relevant business practices associated with structured settlement transactions.
Attorneys fees and prejudgment interest in USCPA: TENNESSEE FARMERS MUT. INS. CO. v. JONES (COA 9/12/08) TENNESSEE FARMERS MUTUAL INS. CO. v. JONES INSURANCE: Attorneys fees and prejudgment interest award affirmed in UCSPA Claim 2007-CA-000911 Published: Affirming Panel: Lambert presiding; Dixon, Stumbo Concur Whitley County Date Rendered: 9/12/2008 The Court affirmed a circuit court judgment finding personal jurisdiction against the appellant Tennessee insurer and awarding attorney?s fees and prejudgment interest to appellee on a claim for that the insurer violated the Kentucky Unfair Claims Settlement Practices Act, KRS 304...
Fifth District: Prejudgment Interest A first-party insurer pays its insured for a loss and becomes subrogated to the insured's breach of contract claim against a third party. Assuming the insurer successfully sues the third party and is entitled to prejudgment interest, should it run from the time the claim was first liquidated or the time the insurer paid its insured? The latter, said the Fifth District in this decision.