New York Civil Law



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A national insurance law newsletter April 3, 2006 ( Vol. 2, No. 18

CaseWatch provides timely summaries of and access to insurance law decisions from the nation’s appellate courts, and is distributed bi-weekly via e-mail. For ease of reference, we have organized the cases by topic. Jurisdictional information and links to full text decisions are found in individual case titles. We appreciate your interest in our newsletter, and welcome your feedback. We also encourage you to share the newsletter with your colleagues. If others in your organization are interested in receiving the publication, or if you do not wish to receive future issues, please contact Kevin T. Merriman.

Additional Insureds

Richard v. Metro Bingo of Lafayette, Inc.

(La. App., 3rd Cir., March 29, 2006)

No Additional Insured Coverage to Lessor in Absence of Lease

Louisiana’s Court of Appeal upheld the trial court’s determination that a lessee’s insurer did not provide coverage to the lessor. The Additional Insured endorsement of lessee’s policy contemplated the existence of a lease for there to be coverage to the additional insured. The lease went into effect, according to its terms, at 1:30 p.m. The parties agreed the accident occurred at approximately 1:15 p.m. One justice dissented, arguing that the “arising out of the … use” language of the additional insured endorsement was broader than the interpretation given by the majority.

Advertising Injury

Park University Enterprises, Inc. v. American Casualty Company of Reading, PA

(10th Cir. March 27, 2006)

Tenth Circuit joins Majority in Holding that Advertising Injury Includes TCPA Claims

The insured was sued for violating the Telephone Consumer Protection Act (TCPA), 47 U.S.C. §227, for sending an unsolicited facsimile. In the declaratory judgment action against the insurer, the issues were whether the insurer owed defense under the property damage and advertising injury provisions of the policy. The Tenth Circuit concluded that the insurer owed a defense under both provisions. As to the advertising injury provision of the policy, the Tenth Circuit agreed with the majority of jurisdictions that interpreted the policy term “privacy” to include claims arising out of violations o the TCPA. The court reasoned that in enacting the TCPA Congress intended to protect a specific privacy right—the right to be left alone—and declined to give the term a restrictive interpretation.

Century 21, Inc. v Diamond State Insurance Company

(2d Cir. (N.Y.) March 21, 2006)

Allegations of Trademark Infringement Arising from Marketing of Claimant’s Product May Amount to “Advertising Injury”

Insured brought action against insurer seeking declaration that insurer was obligated to defend and indemnify it in underlying action for trademark infringement. The claimant alleged that without its consent, the insured commenced the distribution and sale of items bearing unauthorized copies of the claimant’s registered trademark with a resulting likelihood of consumer confusion. The insurer denied coverage on the ground that the allegations did not constitute an “advertising injury” within the meaning of the policy. The court disagreed, finding that the insured was entitled to a defense. In this regard, the court noted that a term as broad and multi-faceted as “marketing” may be construed to include activities apart from selling and distribution that are “within the embrace” of “advertising” as that term is used in the policy to describe the insurer’s coverage.

Attorneys Fees

National Casualty Company, et al. v. Costal Development Services Foundation

(9th Cir. (Cal.) Mar. 20, 2006)

D&O Insurance—Attorneys Fees and Costs Allowed

The court considered whether in an action for equitable relief the insurer was required to pay plaintiff’s attorney’s fees and costs. The court held that the insured reasonably expected that a suit for equitable relief that included exposure to a monetary award of plaintiffs’ attorney’s fees and costs would be covered by the primary policy, as a “claim” for “damages.” The court also held that the excess policy provided coverage after the limits of the primary policy had been exhausted which included payments of plaintiffs’ attorney’s fees and costs.

Auto—Liability

Auto Club Insurance Company v. Buerkel

(Mich. March 21, 2006)

Permissive Use Limited

Owner’s previous permission to driver to use vehicle was not unlimited. Insured’s boyfriend was not permissive user where he drove the vehicle against her protestations and insured repeatedly tried to get him “out from behind the wheel.”

Garnett v. WRP Enterprises, Inc.

(S.C. App. March 20, 2006)

Limits of Coverage

Rental car company’s insurance provided $100,000 per person/$300,000 per accident in coverage for loss sustained. The policy provided $15,000 per person/$30,000 per accident on its face, but contained a rider that stated that when the rental contract provided for limits in excess of the minimum state financial responsibility law, the limits were increased. The renter purchased additional coverage in the contract—i.e. more than the state minimum requirement. The contract did provide that the extra insurance was provided via excess policy. The court held that distinction did not matter as the rental contract explicitly provided more than minimum coverage, making the $100,000/$300,000 limits applicable.

State Farm Mutual Automobile Insurance Company v. US Agencies, LLC

(La. App., 1st Cir., March 24, 2006)

Policy Insuring Driver of Temporary Substitute Vehicle Primary

The court found that the Louisiana statute requiring auto insurers to provide primary coverage for temporary substitute vehicles “as defined in the applicable insurance policy” was mandatory and applied to the insurer despite the absence of any definition of temporary substitute vehicle in the subject policies. The drivers’, and not the vehicles’ owners’, policies, therefore, provided primary coverage.

State Farm Mutual Automobile Insurance Company v Gutierrez

(Ind. App. March 30, 2006)

Passenger “Occupying” Vehicle Where He Temporarily Exited To Retrieve Object That Had Fallen From Vehicle

Injured passenger brought action against vehicle owner’s insurance company for bad faith and breach of contract after insurer denied coverage for medical payments. An accident occurred while the owner and passenger were transporting a playhouse on the owner’s vehicle. When the playhouse fell off of the vehicle, the passenger exited the vehicle to retrieve it. The passenger was injured when, while standing beside the vehicle, the owner put the vehicle in reverse and the open passenger side door struck him. The owner’s insurer denied coverage on the ground that the passenger was not “occupying” the vehicle at the time the accident occurred. The court found that the insurer’s denial of the passenger’s medical payment claim was not made in bad faith. Nevertheless, the court found that the passenger was entitled to coverage because he was “occupying” the vehicle at the time the accident occurred.

Auto—No-fault

Titan Insurance Co. v. North Pointe Insurance Co.

(Mich. March 21, 2006)

One-year statute of limitations for recovery of PIP benefits from tortfeasor’s insurer was measured from the date of accident, regardless of when victim learned of insurance carrier.

Auto—Uninsured/Underinsured Motorist Coverage

Crespi v. NJ CURE

(Super. Ct. N.J. March 28, 2006)

Insured was not obligated to commence a lawsuit against tortfeasors within the statute of limitations to protect insurer’s subrogation rights in order to be entitled to SUM benefits.

Pierson v. Wheeland

(Ohio App. March 22, 2006)

“Other insurance” clauses in UIM coverage were enforceable; court declined to hold that the offending vehicle’s UIM coverage was primary and declined to adopt an “insurance follows the driver” rule.

Matteson v Citizens Insurance Company of America

(Ind. App. March 23, 2006)

Vehicle Not “Uninsured” Where Policy Limits Offered for Offending Party’s Acts

Insured brought action against auto insurer to recover uninsured motorist (UM) benefits after motor carrier’s liability insurer paid policy limits in settlement of suit against carrier, truck owner, and truck driver. The court held that the truck was not an uninsured motor vehicle, even though carrier’s liability policy did not list the truck, its owner, or the driver.

Bad Faith

Contreras v U.S. Security Insurance Company

(Fla. App., 4th Dist., March 22, 2006)

Court Considers Whether Insurer Is Liable For Bad Faith Where Claimant Offers to Settle With Only One Insured

In a matter of first impression, the court considered whether an insurance company could be held liable for bad faith where there was a demand to settle with one insured but not release all insureds. The court held that once it became clear that the claimant’s attorney was unwilling to settle with one insured and give him a complete release, the insurer had no further opportunity to give fair consideration to a reasonable settlement offer for him. Since the insurer could not force the claimant’s attorney to settle and release one of the insureds, it did all it could do to avoid excess exposure to him. Having fulfilled its obligation to the one insured, the insurer thereafter was obligated to take the necessary steps before the settlement offer expired to protect the other insured from what was certain to be a judgment far in excess of her policy limits. Under the terms of its policy, had the insurer paid out its policy limits, its duty to settle or defend would have ceased. In essence, the court held that if an insurer is unable to obtain a release for all defendants, they can still settle with one without being in bad faith.

Cancellation and Non-renewal

Transportation Casualty Insurance Company v All American Air Freight, Inc.

(Fla. App., 4th Dist., March 29, 2006)

Insurer’s Cancellation Ineffective Where It Failed To Notify State

The issue was whether an insurer effectively cancelled an insurance policy where it failed to give the notice to the state as required by a statute applicable to commercial vehicles. Although Florida Statute § 627.7281 does not require notice to the state of cancellation of a policy, Florida Statute § 320.02(5)(e) does where commercial vehicles are involved. The court held that since more specific statutes control over general statutes, the court held that § 320.02(5)(e) applied and that the insurer was required to give notice of cancellation to the state.

Exclusions—Auto

Peagler v. USAA Insurance Company

(S.C. App. March 20, 2006) (Non-precedential)

Insured’s accidental shooting of wife while unloading shotguns from vehicle did not arise out of “use” of vehicle.

Exclusions—Expected/Intended Harm

Auto-Owners Insurance Company v. Hamin

(S.C. App. March 20, 2006)

Insured, a minor, owned home insured by Auto-Owners. The insured’s sister resided at the house. The insured’s sister, after having a fight with their mother, burnt the house down. The insurer disclaimed coverage based on the intentional loss exclusion. The exclusion eliminated coverage for damage caused intentionally by an “insured.” The sister, as “resident relative,” qualified as insured and the court upheld the insurer’s denial of coverage.

Fremin v. Cabral

(La. App., 5th Cir., March 28, 2006)

Allegations of Self-Defense in Responsive Pleadings Brings Claim Potentially Within Coverage

The court held that the Cabrals’ homeowner insurance carrier was not entitled to summary judgment in a suit arising from a dispute with a neighbor that allegedly became violent. The expected or intended acts exclusion in the Cabrals’ policy included an exception for bodily injury resulting from use of reasonable force by the insureds to protect persons or property. Despite that the allegations in the petition did not allege the Cabrals acted in self-defense, the court found that the answer and reconventional demand filed by the Cabrals must be considered in deciding whether a material issue of fact remains. Because the reconventional demand’s narrative asserted the Cabrals acted in self-defense, summary judgment releasing the insurer from any duty to defend or indemnify was inappropriate.

Exclusions—Rental Property

Falzone v Florida Residential Property and Casualty Joint Underwriting Association

(Fla. App., 4th Dist., March 29, 2006)

Court Finds Rental Exclusion of Homeowners’ Policy Applicable

Insurer filed action against insureds, seeking declaration that it was not obligated to defend or indemnify insureds in underlying action for breach of lease arising from mold growth. The insurer denied coverage on the ground that the homeowners’ policy’s exclusion for damage arising from rental of premises. The exclusion excepted rentals that were used on an occasional basis, and rentals in part for use only as a residence. The court found that neither exception applied, and, as such, that the insurer did not owe coverage.

Fire and First-Party

Auto-Owners Insurance Company v Parks

(Ga. App. March 24, 2006)

Court Holds Term “Landslide” Ambiguous; Finds Coverage for Insured

Insured sued insurer in underlying lawsuit, seeking coverage for excavator damaged when an embankment on which it was located gave way, and the excavator slid into a pond. The insurer denied coverage on the ground that the damage did not arise from a named peril. The insured argued that the policy’s provision covering damage due to a landslide applied. In response, the insurer contended that the landslide provision applied only to natural phenomena, and not to landslides caused by human forces. The court held that the term “landslide” was ambiguous, and, therefore, that the insurer was obligated to provide coverage. The court also held that the insurer did not have the right to bring a subrogation action in its name against the person who had rented the excavator when the damaged occurred.

Fraud and Misrepresentation

TIG Insurance v. Homestore, Inc.

(Cal. App., 2 Dist., Mar. 13, 2006)

Misrepresentation In The Application Found

The insurer instituted a rescission action against the insured based upon an alleged misrepresentation in the application for a renewal D&O policy. The court held, under the plain meaning of the application provisions of the insurer’s excess policy and pursuant to California law, the insurer had the right to rescind the excess policy and that it was null, void and of no effect whatsoever as to all insureds.

Miscellaneous

Motiva Enterprises, LLC v. St. Paul Fire and Marine Insurance Company

(5th Cir. (Tx.) March 28, 2006)

The Fifth Circuit held that, under Texas law, an insurer that tenders a defense with a reservation of rights is entitled to enforce its policy’s consent-to-settle clause. Texas law remains unclear, however, whether an insurer must demonstrate prejudice in order to be relieved of its policy obligations when an insured settles a claim without the insurer’s consent. Assuming, without deciding, that Texas law would require prejudice, the court found the insurer prejudiced as a matter of law because it was denied its right to participate in the settlement process: an essential prerequisite to its obligation to pay a settlement.

City of New York v Zurich-American Insurance

(N.Y. App., 2nd Dept., March 21, 2006)

Insurer Obligated to Indemnify Additional Insured for Settlement Arising From “Willful and Contumacious” Conduct

The City of New York sought status as an additional insured under a policy issued by Zurich in an underlying action resulting from sexual assault. Zurich contested coverage on the ground that the City was forced to settle the underlying matter because its answer was stricken due to failure to comply with discovery requests. Zurich argued that the settlement was the equivalent of punitive damages, which an insurer is not required to pay under New York public policy. The court found that Zurich was required to defend and indemnify the City in the underlying action and that, in light of its refusal to do so coupled with its participation in the litigation on behalf of its primary insured, it was not entitled to contest the reasonableness of the settlement.

National Casualty Company v. Sovereign General Insurance Services, Inc.

(Cal. App., 3 Dist., Mar. 14, 2006)

Territorial Limitation Provision in E&O Policy Held Ambiguous

The Court held that the term “claim first brought” in the territorial limitation provision contained in an E&O Policy was ambiguous, but that the reasonable interpretation of the term in light of the policy as a whole is that a claim is first “brought” where it was first tendered or “made.” The Court rejected the argument that the phrase means that a legal proceeding must be initiated within the specified territory.

Notice of Claim or Suit

Gazis v. Miller

(N.J. March 20, 2006)

Excess insurer had to demonstrate prejudice before disclaiming for insured’s failure to comply with 120-day notice provision.

Occurrence

Berman v. Pirrello

(Super. N.J. March 24, 2006)

Insured’s failure to disclose termite damage does not constitute “occurrence” for insurance purposes.

Essex Insurance Company v Zwick

(N.Y. App., 4th Dept., March 17, 2006)

Assault and Battery Exclusion Inapplicable To Bouncer’s Conduct in Restraining Claimant

The court denied insurer’s motion for summary judgment, seeking declaration that it was not obligated to defend or indemnify insured nightclub in underlying action for personal injuries sustained by patron. In this regard, the court found that the injury to the claimant was an “occurrence” and that the insurer failed to demonstrate that the assault and battery exclusion applied to the conduct of the nightclub’s bouncer in restraining the claimant. The court also concluded that the insurer failed to demonstrate that its delay in disclaiming coverage was reasonable as a matter of law.

Workers Compensation

Louisiana Workers’ Compensation Corporation v. Frey IV, d/b/a CF Trucking

(La. App., 1st Cir., March 29, 2006)

The court held that the Louisiana Workers’ Compensation Corporation could not charge premiums to a trucking business that used independent contractors to drive its trucks. The Louisiana Revised Statute governing election of workers’ compensation insurance for independent contractors allows them to elect to not be covered by provisions of the workers’ compensation law. Second, though the independent contractors must make such an election in a “written agreement”, that written agreement may be with either the sole proprietor’s workers’ compensation insurance company covering other employees or with the principal contractor.

California State Automobile Assoc. Inter-Insurance Bureau v. Workers’ Compensation Appeals Board

(Cal. App., 1st Dist., Mar. 22, 2006)

Workers’ Compensation—Claimant Not An Employee

Plaintiff was injured when he fell from a ladder that was placed on the top of a scaffold. Plaintiff who was visiting from Australia did not have a written contract and was hired to paint the interior of a home. The Court held that the plaintiff was not an employee within the definition of an “employee” under the Workers’ Compensation law. Specifically, the Court concluded that the plaintiff was not a “residential employee” (i.e. the person must work 52 hours and earn at least $100 during the 90 days preceding the injury).

Insurance Legislation Update

Credit Information Limitations in Insurance

Delaware Senate Bill 284

(Introduced on Mar. 29, 2006 by Senator Still

This Bill regulates the use of credit information in personal insurance and is based on a model Act promulgated by the National Conference of Insurance Legislators. 26 States have already enacted this Act into law. (Current Status: Referred to Senate Committee on Insurance and Elections on Mar. 29, 2006).

Limited Limits in Tort Actions

Florida House Bill 59

(Introduced on Jan. 4, 2006 by Representative Cannon)

This Bill relates to community behavioral health agencies; provides that certain facilities or programs have liability limits in tort actions under certain circumstances; limits net economic damages allowed per claim; requires that costs to defend actions be assumed by provider or its insurer; specifies occasions upon which immunities enjoyed by provider extend to employee; provides for annual increase in conditional limitations on damages; provides definitions. (Current Status: In House Pending review of Committee Substitute under Rule 6 on Mar. 29, 2006).

Medical Malpractice/Nurse Practitioners

Florida House Bill 1111

(Introduced on Feb. 14, 2006 by Representative Proctor)

This Bill relates to medical malpractice insurance; provides for exempting licensed advanced registered nurse practitioners from certain medical malpractice insurance requirements under certain circumstances; provides criteria; requires licensees to pay certain medical malpractice judgment amounts under certain circumstances; requires certain licensees to post notice disclosing lack of said insurance under certain circumstances. (Current Status: In House Committed on Health Care Regulation: Not Considered on Mar. 28, 2006).

Patient Safety and Provider Liability Act

Florida House Bill 1293

(Introduced on Feb. 24, 2006 by Representative Grant)

This Bill relates to patient safety and provider liability; creates Patient Safety and Provider Liability Act; authorizes insurers to issue insurance coverage that excludes medical negligence for certain health care professionals within hospital; provides limitation on noneconomic damages for hospital facility that complies with certain patient-safety measures; provides for limitations on damages for eligible hospitals that are certified for compliance. (Current Status: In House pending review of Committee Substitute under Rule 6 on Mar. 27, 2006).

Patient Safety and Provider Liability Act

Florida Senate Bill 2160

(Introduced on Feb. 16, 2006 by Senator Saunders)

This Bill relates to patient safety and provider liability; creates Patient Safety and Provider Liability Act; authorizes insurers to issue insurance coverage that excludes medical negligence for certain health care professionals within hospital; provides limitation on noneconomic damages for hospital facility that complies with certain patient-safety measures; provides for limitations on damages for eligible hospitals that are certified for compliance. (Current Status: From Senate Committee on Health Care: reported favorably with amendment on Mar. 29, 2006).

Disaster Preparedness

Florida House Committee on Insurance 1

(Introduced on Feb. 15, 2006 by House Comm. on Ins.)

This Bill provides that changes made to homestead property for purposes of disaster preparedness do not increase the assessed value of the property. Provides incentives for residential hurricane damage prevention activities. Specifies hurricane loss projection data used by insurers in rate filings. (Current Status: From House Committee on Insurance: Reported favorably with amendment on Mar. 16, 2006).

Amendment to State Employees Group Insurance Act of 1971

Illinois House Bill 4079

(Introduced on May 17, 2005 by Representative Boland)

This Bill amends the State Employees Group Insurance Act of 1971. Authorizes child advocacy centers to provide their employees and annuitants, and their dependents, with group health coverage under the Act on a non-insured basis. Provides for the establishment and collection of premiums. (Current Status: Passed Both Houses on Mar. 28, 2006).

Amendment to Illinois Insurance Code/Health Maintenance Org. Act.

Illinois House Bill 4125

(Introduced on Oct. 14, 2005 by Representative Flowers and Garrett)

This Bill amends the Illinois Insurance Code. Provides that a group health benefit plan shall provide coverage for 20 additional outpatient visits for speech therapy for treatment of pervasive developmental disorders that will be in addition to speech therapy provided pursuant to other required outpatient treatment coverage. Amends the Health Maintenance Organization Act to subject health maintenance organizations to the provisions of a Section of the Insurance Code concerning mental and emotional disorders. (Current Status: Passed Both Houses on Mar. 29, 2006).

Amendment to Illinois Insurance Code/Fireman's Continuance Privilege

Illinois Senate Bill 2375

(Introduced on Jan. 18, 2006 by Senator Jacobs)

This Bill amends the Illinois Insurance Code. Requires the Division of Insurance of the Department of Financial and Professional Regulation to enforce the provisions of a Section concerning the firemen's continuance privilege, including provisions relating to municipality self-insured benefit plans. (Current Status: Passed Both Houses on Mar. 30, 2006).

Amendment of Illinois Insurance Code

Illinois Senate bill 2917

(Introduced on Jan. 20, 2006 by Senators Haine & Mautino)

This Bill amends the Illinois Insurance Code. Removes a repeal date from a Section concerning the Standard Non- forfeiture Law for Individual Deferred Annuities. (Current Status: To House Committee on Insurance on Mar. 23, 2006).

Medical Malpractice/Filing Rates

Kentucky House Bill 700

(Introduced on Feb. 27, 2006 by Representative Wilkey)

This Bill relates to medical malpractice; requires filing of medical malpractice insurance rates with the Office of Insurance; prohibits certain components from being included in a medical malpractice rate filing; restricts premiums for medical malpractice polices covering health care providers who deliver one or more babies per year. (Current Status: Recommitted to House on Mar. 14, 2006).

Public Records

Louisiana House Bill 185

(Introduced on Jan. 13, 2006 by Representative K. Carter)

This Bill excepts certain records of the Department of Insurance from the laws relative to public records. (Current Status: Referred to House Committee on House and Governmental Affairs on Mar. 27, 2006).

Definition of Insolvency Revision

Louisiana House Bill 550

(Introduced on Jan. 16, 2006 by Representative Bowler)

This Bill revises the definition of insolvency for purposes of certain provisions of the Insurance Code. (Current Status: Referred to House Committee on Insurance on Mar. 27, 2006).

Investment Laws of Life Insurance Companies

Massachusetts House Bill 1526

(Introduced on Jan. 5, 2005 by Representative Fresolo)

This Bill relates to the investment laws of life insurance companies. (Current Status: In Joint Committee on Financial Services: Heard, Eligible for Executive Session on Mar. 14, 2006).

Liquor Liability Insurance

Massachusetts House Bill 3033

(Introduced on Jan. 5, 2005 by Representative Koutoujian)

This Bill relates to the required amount of liquor liability insurance prior to the issuance of a license to sell alcoholic beverages. (Current Status: To House Committee on Steering, Policy & Scheduling on Mar. 27, 2006).

Amendment to Insurance Code

Massachusetts Senate Bill 613

(Introduced on Jan. 5, 2005 by Senator Moore)

This Bill amends investment-related provisions of the Massachusetts insurance code applicable to life insurance companies. (Current Status: In Joint Committee on Financial Services: Heard, Eligible for Executive Session on Mar. 14, 2006).

Restoration of Fairness in Unemployment Insurance Law

Massachusetts Senate Bill 1102

(Introduced on Jan. 5, 2005 by Senator Hart)

This Bill restores fairness in the unemployment insurance law for workers in temporary jobs. (Current Status: From Joint Committee on Labor and Workforce Development: Amended by substitution of new draft on Mar. 27, 2006).

Property and Casualty Guaranty Association

Michigan House Bill 5292

(Introduced on Oct. 12, 2005 by Representative Mortimer)

This Bill amends the Insurance Code; relates to the property and casualty guaranty association; provides that the association may bring action against any third party administrator, agent or attorney of an insolvent insurer to obtain custody and control of claims information; provides for a refund of unearned premiums; relates to health care corporations, self- insured worker's compensation programs, self- insurers and foreign guaranty associations; provides for reinsurance collections; provides for a claims cap. (Current Status: In Senate, To Second Reading on Mar. 16, 2006).

Amendment to Insurance Code

Michigan House Bill 5870

(Introduced on Mar. 14, 2006 by Representative Polidori)

This Bill amends insurance code to reflect transfer of fire marshal from State Police to Department of Labor and Economic Growth. (Current Status: In House, Read third time. Passed House ******To Senate on Mar. 30, 2006).

Amendment to Insurance Code/Group Wellness Coverage

Michigan Senate Bill 848

(Introduced on Oct. 27, 2005 by Senator George)

This Bill amends the insurance code; requires each insurer providing a group expense-incurred hospital, medical or surgical certificate and each health maintenance organization that offers group wellness coverage to provide for a rebate of premiums if a majority of employees have enrolled and maintained participation in such program offered by the employer; provides for evidence of maintenance or improvement in health status; includes individual, family, hospital, medical and surgical policies. (Current Status: In Senate. Read Second time and amended. To third reading on Mar. 15, 2006).

Insurance Regulation

Minnesota House Bill 2805

(Introduced on Feb. 16, 2006 by Representative Wilkin)

This Bill relates to insurance; modernizes insurance regulation; amends mutual holding company laws; enacts the interstate insurance product regulation compact; makes miscellaneous insurance law changes. (Current Status: To House Committee on Civil Law and Elections on March 23, 2006).

Minnesota Unemployment Insurance Law

Minnesota House Bill 3093

(Introduced on Mar. 2, 2006 by Representative Gunther)

This Bill relates to unemployment insurance; makes various policy, housekeeping, and style changes to the Minnesota Unemployment Insurance Law; incorporates certain administrative rules into Minnesota Statutes; modifies fraud penalties. (Current Status: Referred to House Committee on Ways and Means on Mar. 27, 2006).

Torts Claims Board/Transfer of Assets

Mississippi Senate Bill 2056

(Introduced on Jan. 4, 2006 by Senator Kirby)

This Bill authorizes Tort Claims Board to transfer assets and liabilities for medical malpractice insurance availability plan. (Current Status: Conference Committee Report adopted by House on Mar. 28, 2006).

Property and Casualty Insurance

New Hampshire House Bill 1192

(Introduced on Dec. 29, 2005 by Representative S. Francoeur)

This Bill makes certain changes in the insurance laws relative to property and casualty insurance. (Current Status: To Senate Committee on Banks & Insurance on Mar. 21, 2006).

Unemployment Insurance Law/Farm Laborers

New York Senate Bill 5130A

(Introduced on Apr. 18, 2005 by Senator Flanagan)

This Bill enacts the Farmworkers Fair Labor Practices Act; grants collective bargaining rights to farm laborers; requires employers of farm labors to allow at least 24 consecutive hours of rest each week; provides for an 8 hour work day for farm laborers; requires overtime rate at one and one-half times normal rate; makes provisions of unemployment insurance law applicable to farm laborers; defines work agreement and mandates use thereof. (Current Status: Amended in Senate Committee on Labor on Mar. 21, 2006).

Pennsylvania Senate Bill 1007

(Introduced on Nov. 14, 2005 by Senator White)

This Bill amends the Insurance Company Law of 1921. Provides for fire insurance contracts, and standard policy provisions to include damage caused by terrorism. Authorizes insurers to include a statement in fire insurance policies that the policy does not cover loss or damage resulting form acts of terrorism. (Current Status: From Senate Committee on Appropriations, Reported as amended on Mar. 27, 2006).

Amendment to the Insurance Code

Utah House Bill 72

(Introduced on Jan. 4, 2006 by Senator Snow)

This Bill amends the Insurance Code, the state Labor Code, and the state Administrative Services Code to address workers' compensation coverage for the state; addresses the makeup of the Workers' Compensation Fund's board of directors; deletes the requirement that state entities pay the Workers' Compensation Fund for workers' compensation coverage; establishes requirements for the state to secure payment of workers' compensation benefits for its employees. (Current Status: Passed - Chaptered. Chapter No. 275 on Mar. 20, 2006).

Adoption of Indemnity Benefits in the Insurance Code

Utah House Bill 199

(Introduced on Jan 24, 2006 by Representative Newbold)

This Bill clarifies the adoption indemnity benefits in the Insurance Code; clarifies that the requirements for adoption indemnity in health insurance policies establishes the minimum requirements and does not prohibit an insurer from offering greater benefits. (Current Status: Passed - Chaptered. Chapter No. 094 on Mar. 20, 2006).

Amendment to Utah Insurance Law

Utah House Bill 272

(Introduced on Jan. 17, 2006 by Representative Kiser)

This Bill relates to insurance law amendments; expands immunity provision to include authorized representatives of the commissioner; clarifies taxation of a captive insurance company; creates a restricted special revenue fund called the Captive Insurance Special Revenue Fund with certain monies nonlapsing; modifies citations related to voluntary dissolution of a domestic insurance corporation; provides that the Life and Health Insurance Guaranty Association is not a state agency. (Current Status: Passed - Chaptered. Chapter No. 275 on March 20, 2006).

Modification to Insurance Code

Utah House Bill 308

(Introduced on Jan. 20, 2006 by Representative Kiser)

This Bill modifies the Insurance Code to address requirements for policy or contracts; provides that an insurer unless otherwise provided by the Insurance Code shall follow the terms of an insurance policy issued or assumed by the insurer; clarifies application to cancellations of a reference in the provision related to nonrenewal of insurance policies by an insurer; addresses minimum requirements for personal injury protection coverage and benefits. (Current Status: Passed - Chaptered. Chapter No. 197 on Mar. 20, 2006).

Modification of Insurance Code/Bail Bond Companies

Utah House Bill 403

(Introduced on Jan. 28, 2006 by Representative Hughes)

This Bill modifies the Insurance Code and the Code of Criminal Procedure regarding bail bond securities; allows a bail bond company to pay a bond forfeiture prior to judgment; amends the process regarding posting proof of a surety bond; provides that for purposes of the sureties on an undertaking, a plea in abeyance is considered to be the same as a guilty plea; provides that the bail bond surety is not responsible regarding suspended or deferred sentencing. (Current Status: Passed - Chaptered. Chapter No. 332 on Mar. 20, 2006).

Uninsured/Underinsured Motorist Coverage

Utah Senate Bill 224

(Introduced on Jan. 28, 2006 by Senator Killpack)

This Bill modifies the Insurance Code; amends the provisions relating to arbitration for uninsured and underinsured motorist coverage claims; provides that the named insured or a covered person asserting a claim against a person's uninsured or underinsured motorist coverage may elect to resolve the claim by submitting the claim to binding arbitration of through litigation; provides the procedures for resolving the claim through arbitration. (Current Status: Passed - Chaptered. Chapter No. 069 on Mar. 20, 2006).

Introduces Program to Reduce Medical Malpractice Premiums

Vermont Senate Bill 198

(Prefiled on Dec. 8, 2005 by Senator Sears)

This Bill proposes the following provisions related to reporting and notification of medical errors: makes an expression of regret or apology made by or on behalf of a health care provider inadmissible in any civil or administrative proceeding against the provider; requires health care providers to report medical errors to patients; establishes a program called Sorry Works intended to reduce medical malpractice litigation and insurance premiums. (Current Status: To House Committee on Judiciary on Mar. 21, 2006).

Workers Compensation Commission/Procedural Mechanism Change

Virginia Senate Bill 632

(Introduced on Jan. 16, 2006 by Senator Edwards)

This Bill establishes a procedure for a claimant to seek a redetermination of a decision by the Workers Compensation Commission finding that an injury is not a birth-related injury; relates to neurological injuries that are birth related. (Current Status: Eligible for Governor's Desk on Mar. 15, 2006).

Noneconomic Damages of Medical Malpractice Cases

Wisconsin Assembly Bill 1073

(Introduced on Feb. 27, 2006 by Assemblyperson Gielow)

This Bill Relates to recovery of noneconomic damages in medical malpractice cases; relates to acts or omissions of an employee of a health care provider; relates to establishing a limitation on noneconomic damage awards; relates to bodily injury; relates to malpractice insurance coverage and helping to contain health care costs. (Current Status: Passed - Act. No. 183 on Mar. 22, 2006).

Goldberg Segalla LLP is a Best Practices law firm with offices in Buffalo, Rochester, Syracuse, Albany, Manhattan, White Plains and Long Island. We counsel and represent individuals and businesses in specialized areas of civil litigation, contractual and extra-contractual disputes and regulatory matters before state and federal agencies. Our Insurance Coverage Team consists of the following attorneys:

Richard J. Cohen, Partner Thomas F. Segalla, Partner

Kevin T. Merriman, Partner Daniel W. Gerber, Partner

Joanna Roberto, Partner

Christopher J. Belter, Partner

Theresa J. Puleo, Partner

Sarah J. Delaney

Chandran B. Iyer

Matthew S. Lerner

Kimberlee L. Danieu

Joanna Dickinson

Carrie P. Parks

Kimberly E. Whistler

Robert Varga

Newsletter Editor

Kevin T. Merriman

Contributing Authors

Thomas F. Segalla

Sarah J. Delaney

Chandran B. Iyer

Matthew S. Lerner

Carrie P. Parks

Joanna Dickinson

Robert Varga

BUFFALO

665 Main Street / Suite 400, Buffalo, New York 14203-1425

Telephone: 716.566.5400 Fax: 716.566.5401

ROCHESTER

2 State Street / Suite 805, Rochester, New York 14614-1342

Telephone: 585.295.5400 Fax: 585.295.8300

SYRACUSE

5789 Widewaters Parkway, Syracuse, New York 13214-1855

Telephone: 315.413.5400 Fax: 315.413.5401

ALBANY

8 Southwoods Blvd. / Suite 300, Albany, New York 12211-2364

Telephone: 518.463.5400 Fax: 518.463.5420

MANHATTAN

111 John Street / Suite 800, New York, New York 10038-3002

Telephone: 646.253.5400 Fax: 646.253.5500

WHITE PLAINS

170 Hamilton Avenue / Suite 203, White Plains, New York 10601-1717

Telephone: 914.798.5400 Fax: 914.798.5401

LONG ISLAND

333 Route 111, Smithtown, New York 11787-4759

Telephone: 631.360.2600 Fax: 631.360.3434

EUROPE

We are affiliated with:

Studio Legale Casini, C.so di Porta Romana, 63 20121 Milano, Italy

Telephone: 011-39-02-54113609 Fax: 011-39-02-54116314

Via M. Coppino, 273, 55049 Viareggio, Italy

Telephone: 011-39-05-84388797 Fax: 011-39-05-84388798

© COPYRIGHT 2006 Goldberg Segalla LLP, ALL RIGHTS RESERVED

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