Bad Faith Insurance Companies

December 20, 2014

(All text, images, and content courtesy of All rights reserved.)


Boicourt v. Amex Assurance Co.
Award: $2,006,000
A boy severely injured in a vehicle accident settled for more than $2
million pursuant to a policy that provided only $100,000 in coverage,
because the insurance carrier initially refused, in bad faith, to disclose
the policy limits.
Matson Terminals v. Home Insurance Co
Settlement: $33.65 million
Home Insurance Company denied coverage for a $10 million earthquake claim,
and a California jury concluded the denial, based on a policy exclusion,
was in bad faith. The jury awarded $11,000,000 in punitive damages. The
appeals court, in affirming the award that included $23.5 million in
compensatory damages, held that the insurer led the policyholder to
believe there was coverage, and encouraged it to initiate repairs.
David Clayton v. United Services Automobile Association
Award: $3.9 million
A California jury found the insurance company's offer of $10,000 on policy
limits of $300,000 to parents whose only child was killed in an auto
accident was unreasonable and in bad faith. An appellate panel affirmed
the award. The California Supreme Court denied review of the case.
Vann v. The Travelers Insurance Company
Award: $26.5 million
The former owner of an auto repair shop was asked to vacate the premises
after his landlord died. Following, he was sued for causing environmental
damage on the property. He asked his insurance company to provide him with
a defense. First they denied he had a policy, and then, after admitting
such a policy existed, they inundated him with burdensome and harassing
requests for information with which he could not comply. After denial of
the claim, Mr. Vann sued for bad faith and the jury agreed. The Travelers’
appeals all the way up to the U.S. Supreme Court were unsuccessful.
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