Volume XXVIII, No. 9 (No. 734)
Friday, October 9, 2026
A Biweekly Electronic Newsletter
As a public service, Hurwitz Fine P.C. is pleased to present its biweekly newsletter, providing summaries of and access to the latest insurance law decisions from the New York, New Jersey, and Connecticut appellate courts and Canadian appellate courts. The primary purpose of this newsletter is to provide timely educational information and commentary for our clients and subscribers.
In some jurisdictions, newsletters such as this may be considered Attorney Advertising.
If you know of others who may wish to subscribe to this free publication, or if you wish to discontinue your subscription, please advise Dan D. Kohane at [email protected] or call 716-849-8900.
You will find back issues of Coverage Pointers on the firm website listed above.
Dear Coverage Pointers Subscribers:
Do you have a situation? We love situations.
There is a lengthy decision out of the First Department relating to coverage for the NFL helmet concussion class action reported in my column. It covers a number of very important topics, and I recommend a close reading of the decision, or, at least, my summary.
Coverage Pointers University Presents
Construction Defect and Work Product Exclusions
Presented by Steven E. Peiper
Thursday, October 15, 2026
Via Zoom
Join Hurwitz Fine Insurance Coverage Co-Chair Steven E. Peiper for a practical webinar examining the complexities of construction defect claims under commercial general liability (CGL) policies. This session will explore how courts interpret the scope of coverage for construction defects, including threshold issues that trigger coverage and the application of completed operations coverage. Steve will also examine the distinctions between work product and product liability exclusions commonly found in CGL policies, highlighting how differences in policy language can impact coverage determinations. Attendees will gain practical insight into evaluating construction defect claims, interpreting key policy provisions, and navigating coverage disputes involving defective workmanship.
LinkedIn:
For those who need to keep up to date on insurance coverage between issues of Coverage Pointers, we’re happy to help. Just follow me on LinkedIn and we’ll keep you up to date. I’m easy to find – my linked in name is (ready for this unusual and unexpected name): Kohane and you can find me here: https://www.linkedin.com/in/kohane/
Need a Mediator or Arbitrator, I’m Now on the NAM Panel of Distinguished Neutrals:
I joyously continue my full-time practice with Hurwitz Fine P.C., but I am now mediating cases through NAM.. If I can be of assistance to you or those in your firm or company, please reach out as indicated below.
I am pleased to announce that I have recently joined NAM (National Arbitration and Mediation) as a Hearing Officer. NAM is one of the nation's leading full-service providers of Alternative Dispute Resolution (ADR) services and as a member of their esteemed panel, I will be available to arbitrate and mediate cases throughout New York State. Reach out to NAM:
Click on the pix to book a mediation with me through NAM
Hearing Officer
NAM has been supporting clients throughout the U.S. and in major cities around the world through a highly secure suite of onsite, virtual, and hybrid forums for more than 30 years. Recognized for its superb customer service, market-leading technology, and an exceptional panel of arbitrators and mediators, NAM offers a streamlined alternative to traditional litigation. With an exceptional roster of neutrals and concierge-level case administration, NAM is the ADR partner of choice for over 10,000 commercial entities and half the Fortune 100.
Newsletters:
We have other firm newsletters to which you can subscribe by simply letting the editor (or me) know, including a new publication, which was created to advise on business and employment law questions:
- Premises Pointers: This monthly electronic newsletter covers current cases, trends and developments involving premises liability and general litigation. Our attorneys must stay abreast of new cases and trends across New York in both State and Federal Court and will now share their insight and analysis with you. This publication covers a wide range of topics including retail, restaurant and hospitality liability, slip and fall accidents, snow and ice claims, storm in progress, inadequate/negligent security, inadequate maintenance and negligent repair, service contracts, elevator and escalator accidents, swimming pool and recreational accidents, negligent supervision, assumption of risk, tavern owner and dram shop liability, homeowner liability and toxic exposures (just to name a few!). Please drop a note to Jody Briandi at [email protected] to be added to the mailing list.
- Labor Law Pointers: Hurwitz Fine P.C.’s Labor Law Pointers offers a monthly review and analysis of every New York State Labor Law case decided during the month by the Court of Appeals and all four Departments. This e-mail direct newsletter is published the first Wednesday of each month on four distinct areas – New York Labor Law Sections 240(1), 241(6), 200 and indemnity/risk transfer. Contact Dave Adams at [email protected] to subscribe.
- Products Liability Pointers: Whether the claim is based on a defective design, flawed manufacturing process, or inadequate instructions/warnings, product liability litigation is constantly evolving. Products Liability Pointers examines recent New York State and Federal cases as well as high court decisions from other jurisdictions, keeping our readers up to date with the latest developments and trends, and providing useful practice tips and litigation strategies. This monthly newsletter covers all areas of product liability litigation, including negligence, strict products liability, breach of warranty claims, medical device litigation, toxic and mass torts, regulatory framework, and governmental agencies. Contact V. Christopher Potenza at [email protected] to subscribe.
- Medical & Nursing Home Liability Pointers. Medical & Nursing Home Liability Pointers provides the latest news, developments, and analysis of recent court decisions impacting the medical and long-term care communities. Contact Elizabeth Midgley at [email protected] to subscribe.
Who Dat? – 100 Years Ago:
Rochester Journal and the Post Express
Rochester, New York
9 Oct 1926
ADVICE TO THE
LOVELORN
By Beatrice Fairfax
DEAR MISS FAIRFAX:
During the Summer I went around with a young man for whom I cared a great deal. He acted as though he cared for me.
Lately when he passes me he doesn't seem to recognize me, although he stares at me. He never talks to me and never comes to any of my parties.
What would you advise me to do? LIL.
IF the young man is deliberately snubbing you, and you have not hurt or insulted him, then I certainly would drop such an unmannerly and undependable person from my list of friends and cultivate the acquaintance of more worthwhile young people.
Peiper on Property (and Potpourri):
Welcome to Fall, folks. If 70 degrees and sunny is the new Fall, sign me up. So far so good on the weather front.
Speaking of signing up, please join us for the first class of the sophomore year of Coverage Pointers University. The Professors of CPU have been working on a whole new slate of interesting and informative classes. For the property lover, we kick of Season Two with a Construction Defect Primer. Good clean fun to be had for all. Hope to see you there!
This weekend we head out for what may be the final travel hockey tournament where it is scheduled to be 80 degrees on Saturday in Grand Rapids. Over the last 11 years, we’ve spent a lot of time looking out the windshield with countless trips to Pittsburgh, Toronto, Boston, NYC, Cleveland, Detroit, Rochester, and Syracuse. We have also secured team hotel rooms in Philadelphia, Nashville, Chicago, Washington DC and Irvine, California. It has been a great run, and there will be a few fathers feeling quite nostalgic this weekend.
That’s it for this week. See you in two more.
Steve
Steven E. Peiper
[email protected]
A Fine for a Slap – 100 Years Ago:
The Buffalo News
Buffalo, New York
9 Oct 1926
SLAP AT GIRL FRIEND
COSTS HIM JUST $5
LOCKPORT. Oct. 7.- Peter Butera, 19 years old, 286 Chapel Street, was arraigned in police court here on complaint of Myrtle Moshiges, 342 Clinton street, a former girlfriend, who alleged that she was slapped In An argument. Butera pleaded self-defense, but Judge Irving T. Roberts warned him his best defense was flight and fined him $5.
Lee’s Connecticut Chronicles:
Off in a secluded location with my bride, celebrating our anniversary. See you next edition; keep keeping safe.
Lee
Lee S. Siegel
[email protected]
Lynchings Still Going On – 100 Years Ago:
The Ardmore Daily Press
Ardmore, OK
9 Oct 1926
Mob Violence Is
Loose In South
Carolina Village
AIKEN, S. C. Oct. 8.-(AP)- Mob violence flared up in Aiken early today leaving the bullet riddled bodies of three negroes as its victims. Overpowering the sheriff and jailer a band of unidentified men variously estimated at between 50 and 100 stormed the county jail seized the negroes, one a woman on trial for the murder of a former sheriff took them outside the city where the bullet riddled bodies were found.
Ryan’s Federal Reporter:
Hello Loyal Coverage Pointers Subscribers:
Another fall baseball season in the books for my boys. Park closing in a week or so and then we prep for Spring! Wash, rinse, repeat, and I wouldn’t have it any other way.
This edition, I have an errors and omissions case concerning admission of liability. The takeaway: don’t do it before notice.
Until next time…
Ryan
Ryan P. Maxwell
[email protected]
Cut Down on Women’s Hours – 100 Years Ago:
The Buffalo Times
Buffalo, New York
9 Oct 1926
48 Hours for Women
An Election Factor
It is becoming increasingly evident that the question of a 48-hour week for women in Industry will be a factor in the fall election. According to James A. Hamilton, State industrial commissioner, there can no longer be serious objection to the law.
"There is no insuperable economic difficulty in the making universal for factories and stores the 48-hour week for women," he says. "That step rather appears as the logical completion of the greater shorter-hour movement that has gone before, which the industries of the State have already achieved without losing prosperity."
Mr. Hamilton says that the 48- hour week has been adopted by employers of considerably more than half the workers in the factories and mercantile establishments of the State. Furthermore, he maintains, the final step to such working condition for all the women of the State, as proposed, would not be a radical step, since two-thirds of the women in factories up-State and three-quarters of those in New York City who are working more than 48 hours are working only 49, 50 or 51 hours. Thus, for the largest part of the women who would be affected, the change would only be or two hours a week, and in some cases three hours. In mercantile establishments only 18 per cent, of the women would be affected at all, and for one-third of these the hours would be shortened only one or two a week.
Storm’s SIU:
Hi Team:
Since last edition I have had the privilege of success for two separate clients: a substantial issue in first-party property case; and a 3rd-party liability declaratory judgment action. They are:
- In a 1st Party Property Claim Where Co-Owners Hold Title to a Property as Tenants in Common and Only One Owner Insurers His Interest Through a Policy, Policy Language Limiting Recovery to the Insured’s “Interest at the Time of Loss,” Limits the Insured’s Recovery to His Interest in the Dwelling Damages (in this Case 50%).
A Mortgagee’s Right to Insurance Proceeds can be Cut Off Post-Loss if the Mortgage Debt Becomes Judicially Unenforceable Even Though an Insurable Interest Existed on the Date of Loss.
- In a Third-Party Liability Claim Where Both Spouses are Named Insureds, “Insured v. Insured” Injury Exclusion is Dispositive Regardless of Later Changes in Residence or Title. Attempts to Manufacture Ambiguity from “Resident Spouse” Extensions Fail Where the Policy Clearly Defines “You”/“Insured” and Separately Excludes Injury to an Insured.
Please let me know if you have any questions regarding either or would like to discuss the decisions further.
I love and am enjoying Fall both for the weather and the MLB playoffs. Let’s Go Dodgers!!!
Ask me this question, “Scott, why are you a Dodgers fan, living in Western N.Y.?” Well, it’s been the family team since they were in Brooklyn. We have remained faithful despite their move to L.A. And it gives us a good reason to visit the sunny, hot west coast.
See you again in two weeks,
Scott
Scott D. Storm
[email protected]
An Important Part of the Trousers – 100 Years Ago:
Buffalo Courier Express
Buffalo, New York
9 Oct 1926
“$18 or I Fire,” says Mope,
“$25,” says John- Bang!
One bullet pierces shop-keeper’s hand and other
riddles lovely suit of clothes
Chicago Tribune Leased Wire
Chicago, Ill., Oct. 8 - Into the store of John Kaluzna came Thomas Mope. The name seems hardly credible, but the cipher experts of the Maxwell street police station cut it off a note penciled by the gentleman himself – Thomas Mope. He was colored, but that has nothing to do with the story.
“I want a suit," said Mope.
Mr. Kaluzna brought out $25 worth of the best goods in Maxwell Street
"I won’t pay $25," declared Mope.
"I am now losing money," recited Kaluzna. "You go out anywhere in Chicago and you ask any judge of good clothes for how much would he wear that suit and he would tell you not for a cent less than $50."
"I got $18," said Mope. "I'll give you $18 for it."
"I now have reduced suit from $60," said Kaluzna, "There isn't the in $18 suits reduced from $60 money that there is in $25 suits."
"You can't insult me, you robber." Mope told him. "I said $18, you thief."
"Twenty-five," retorted Kaluzna.
"Eighteen or I shoot your head off," countered Mope.
"Shoot if you must this old gray head. I can't live on the $18 suit business," declared Kaluzna.
So, Mope shot him.
One bullet went through Kaluzna's hand. Another went through the $25 suit and spoiled an important part of the trousers. The suit is now reduced to $18, and the police are sitting on the doorstep waiting for Mope to come back.
Fleming’s Finest:
Hi Coverage Pointers Subscribers:
The past month has been a whirlwind since I returned from Australia, but I am looking forward to all of the classic autumnal activities as well as a women’s 10k this weekend in Boston. The beautiful changing leaves are definitely a plus on my drive to work.
This edition’s case from the Colorado Supreme Court considered whether based on the insuring agreement and defense provision language in the excess insurance umbrella policy, the excess/umbrella carrier was obligated to “step into the shoes” of the insolvent underlying primary carrier by providing first-dollar indemnity and defense costs to the insured that otherwise would have been paid by the insolvent carrier.
See you in a fortnight,
Kate
Katherine A. Fleming
[email protected]
The Wagers of Sin? – 100 Years Ago:
The Buffalo Times
Buffalo, New York
9 Oct 1926
DEAR MISS DIX
The other night I was out riding with very attractive girl whom I thought I was in love. We made a bet that if the first that passed us was a Ford we would get a license and get married the next week. The first car that passed us was a Ford and the girl is willing to keep her bet and take her chance. I would like your advice on this. We both frankly admit that we do not love each other but think that we might learn to. I have already obtained the license and am awaiting your advice. A DESPERATE MAN.
ANSWER:
The Ford car has many sins to answer for, but this is the first time I have ever heard of it figuring as the come on in a fool wedding. Let us hope your example will not be followed and that henceforth Lizzie will not figure as first-aid cupid.
Of course, no sane person could give you but one piece of advice. And that is to call your silly bet off. It is a horrible thing to think that any man or woman outside of a home for the incurably feeble-minded would risk their whole life’s happiness and well-being on the chance of a certain make of car passing them.
What a sacrilege it is in the name of love! How little sense of the awfulness of taking another’s life into one’s hands; of deciding not only one’s own weal and woe but another’s; of establishing a new home and another family; of bring children into the world! For that is what marriage means.
Don’t do it, my friends. Don’t commit this terrible crime against yourselves and against each other. Don’t marry on a bet, for if you do the one best bet is that you will and in the divorce courts. DOROTHY DIX
Gestwick’s Garden State Gazette:
Dear Readers:
Well, it’s official—my wife and I are homeowners! This weekend, and surely ones to follow, will be consumed by packing, moving, cleaning, and unpacking. We have already made our initial trip to Home Depot, to acquire new locks for the house, among other essentials. Now, it’s time to learn how to be handy.
The case I have for you this week delivers a simple but important lesson—insurance carriers, if a plaintiff tries to serve you with a Summons and Complaint meant for your insured, be sure to check first whether the Court has already given them permission to do so. If instead the plaintiff serves you with a copy of their motion to allow service of your insured in that manner, check whether the plaintiff’s attempts to serve your insured personally were diligent. Accepting service on your insured’s behalf could ultimately be a disservice to your insured, and to you.
That’s all I have for this week—see you in two more.
Evan
Evan D. Gestwick
[email protected]
Imagine – 100 Years Ago:
The Indianapolis Times
Indianapolis, IN
9 Oct 1926
WHOLE TEAM PINCHED
WASHINGTON, Oct. 9. – A whole football team was arrested here Friday when policemen found boys playing the pigskin game in an alley, in violation of a District of Columbia law. They were released on pledges not to do it again.
O’Shea Rides the Circuits:
Hey Readers,
This weekend my wife and I will be hiking through a local state park, dogs unincluded. Another note is that any time you try to catch the early flight home, expect to land at 11:30 pm.
This week I have quick excerpt from an unpublished criminal case from the Fourth Circuit. The part we review relates to whether insurance representatives qualified as lay experts regarding material misrepresentations in life insurance applications.
Until Next Time,
Ryan
Ryan P. O’Shea
[email protected]
Women, Apparently, Like Baths – 100 Years Ago:
The Buffalo Times
Buffalo, New York
9 Oct 1926
DRY BATHTUBS
ROUT WOMEN
LONDON, Oct. 8. – The only way to get the London women out of the public baths is to drain the bathtubs dry, according to the baths commissioners. A special tap has been connected to each tub so that an attendant, from outside, can draw off the water when the female bather’s time is up.
The women, especially in the hot weather, have come in crowds to the public bath-halls, paid their two pennies and locked themselves in for hours while they sat, immersed in water to their chins, eating chocolates, reading novels, and sometimes even doing their family sewing and mending.
Not infrequently the women bathers smoke up an entire packet of cigarettes before stepping out of their tubs.
“We made it too comfortable.” The bath authorities admit, “but we think we have found the solutions. Few women like to sit long in an empty tub.”
LaBarbera’s Lower Court Library:
Dear Readers:
Tis the season of meat raffles. For those who have never attended – I strongly recommend, if anything, just for the people watching. Each time I go, I forget the absolute craze that washes over people when faced with a good deal. The hooting and hollering did not stop. Hours of it. All in all, a good night, as I was the lucky winner of five pounds of French Fries and Pizza Logs. Going to another one this weekend, hoping I am even luckier.
This week, my case is as hot off the press as it gets. Handled by our very own, Mr. Ryan O’Shea. This case is packed with good discussion, covering the sufficiency of motion papers, issue preclusion, and whether an accident arose out of the use of a covered automobile. All in all, the Court found that the automobile insurance carrier does not owe coverage, because the vehicle involved in the accident was being used as a construction platform at the time of the incident. A copy of the decision is available upon request.
Until next time…
Isabelle
Isabelle H. LaBarbera
[email protected]
Now There’s a Good Idea – 100 Years Ago:
Rochester Journal and the Post Express
Rochester, New York
9 Oct 1926
FINGER PRINT
SYSTEM URGED
IN STEUBEN
BATH, Oct. 9. – When the Steuben County Supervisors meet in annual session here next month, efforts will be made to obtain an appropriation for the establishment and maintenance of a bureau of identification by finger prints.
Such a system is urged for guidance of the sheriff’s department and other police in the county.
It is argued that this is one of the largest counties in the state, has two cities and several large villages: that arrests of many men, of an itinerant class, unknown to local police are numerous.
Many of these men are wanted for crimes committed in other places, but absolute means of identification are lacking. This the finger print system would supply.
Lexi’s Legislative Lowdown:
Dear Readers,
A true marker of summer coming to a close is my bowling league starting up. I am pleased to report that in my first week back I scored in the triple digits in all three games, which is an accomplishment for me. Unfortunately, in week two this level of success did not continue, and I scored somewhere between 50-70 in all three games (apologies to my teammates). Stay tuned for this weekend’s results.
This week we discuss a newly introduced bill focused on transparency in property/casualty underwriting. Assembly Bill A11724 would give the Department of Financial Services access to insurers’ underwriting models or, when those models are unavailable, detailed claim data for regulatory review.
We will continue to monitor the bill as it proceeds through the Assembly Insurance Committee.
Thanks for reading,
Lexi
Lexi R. Horton
[email protected]
Tesla Would Have Been Jealous – 100 Years Ago:
Rochester Journal and the Post Express
Rochester, New York
9 Oct 1926
THE AUTOMOBILE SHOW in Paris includes and electric automobile that runs 930 miles without recharging. American manufacturers must watch that.
Some genius, now twiddling his fingers on a public school bench, thinking of something besides his lessons, will invent a battery to carry canned electric power with-out great weight. That will be the beginning of a new automobile and flying age. Electricity doesn’t weigh anything. Someone will find a container that weighs little. Then good-by gas engines.
Victoria’s Vision on Bad Faith
Dear Readers,
This weekend I am attending the gender reveal party of my future niece or nephew. If my intuition is correct, I think it’s going to be a boy. That, and I don’t own any pink shirts, so blue it is.
New York state and federal courts have been quiet on bad faith lately, so this week I have a case for you from the Eleventh Circuit.
Have a good weekend,
Victoria
Victoria S. Heist
[email protected]
Two Strings to a Bow? – 100 Years Ago:
Rochester Journal and the Post Express
Rochester, New York
9 Oct 1926
FIGURES OF
SPEECH
By King Features
“Two Strings to His Bow”
WHEN a man has “two strings to his bow” he has more than one business or means of support, so that if one fails him he can fall back on the other. Sometimes the phrase is applied to affairs of the heart. If one has two sweethearts and one “goes back on her” she can turn to the other “string to her bow.” The French have exactly the same phrase and the Romans used to say, “He is moored with two anchors.” The Italians say, “He sails by two winds.”
Shim’s Serious Injury Segment
Hi Readers,
I recently came to learn of a term I had never heard previously. The term is "Zillennial." A Zillennial is the term used to describe the small generation of individuals born between 1993 and 1998. These individuals are between Millennials and Gen Z. Zillennials often feel “too old” for Gen Z and “too young” for Millennials. Born in 1997, I have often felt like I do not belong to either generation although 1997 births are considered the first year of Gen Z. I realized that Zillennials are the last generation to grow up without smartphones, high speed internet, and video calls.
The article "Meet Zillennials: The luckiest micro-generation in the workforce, born between 1993 and 1998" sums up this phenomenon perfectly: “Born in the mid-1990s, they had early childhoods shaped by desktop internet and physical play before smartphones became ubiquitous. The iPhone launched in 2007, when the oldest Zillennials were around 12 or 13 — young enough to absorb it, old enough to remember before. They came of age professionally in the late 2010s, entered the workforce around the pandemic’s inflection point, and are now in their late 20s and early 30s: the exact career stage at which Xennials began to differentiate themselves from their generational peers.”
Us Zillennials are truly the last generation to know life before technology took over – but also the first to learn how to use it during our formative years. I still remember desktop computers, making plans with friends in school and not confirming them over text moments before we agreed to meet, bulky televisions with free, basic cable, purchasing physical media and learning how to drive on a car that did not have a touch screen, backup camera or blind spot detection. These were far simpler and more peaceful times. Gone forever.
The above inherently begs the question, are we better off now than we were before the technology takeover? Are we happier? Are human relationships closer? Is our quality of life truly better? These questions hardly matter anymore …
In this week’s issue, I have shared an Appellate Division, Second Department, decision in which the Court reversed the Supreme Court’s decision granting defendants’ cross-motion for summary judgment on the issue of “serious injury.”
See you in the next issue!
Stephen
Stephen M. Shimshi
[email protected]
$3,900 in Today’s Dollars – 100 Years Ago:
The Buffalo News
Buffalo, New York
9 Oct 1926
New England Almanack
Dear Readers,
In keeping with my reluctance to bid summer farewell, I toured Florence, Italy, and Tuscany during the last week of September where I enjoyed sunshine in the 80s after making my escape before the Nor’Easter’s arrival. The tours in the birthplace of the renaissance followed by several days in the gorgeous countryside lived up to their reputation. With batteries (purportedly) recharged, I delved back into a busy week on the work front with minimal jet lag ill-effects. Over the coming weekend, I’ll do my best to ease into Fall by setting out the obligatory pumpkins and mums on the entryway (no Halloween decorations yet!).
For the current issue, we bring you an interesting bench trial ruling in the Superior Court Business Litigation Session where the insurer avoided the imposition of multiple damages for a knowing and willful violations of the Massachusetts Unfair Claims Handling and Business Practices Statutes, c. 176D and 93A, because the awards entered in the homeowners’ favor in reference proceedings on their fire loss claims were not reduced to a Judgment and their efforts to establish compensable injuries from the insurer’s unfair claims handling practices fell short.
Happy Reading.
Barbara
Barbara A. O’Donnell
[email protected]
Don’t They Always? – 100 Years Ago:
Yonkers Statesman
Yonkers, New York
9 Oct 1926
Fascists Make Up
New Set of Rules
ROME, Oct. 9. – The Fascist party today adopted a new set of rules and regulations for governing the party The elective system for places of authority within the party has been abolished and central authority vested in a general secretary, who then chooses provincial secretaries. Premier Benito Mussolini was named general secretary.
North of the Border:
We have had a beautiful fall so far. First the larches turned yellow and gold, and now the aspens have followed, all set against a brilliant blue sky.
At our house, fall also means hockey. Our six-year-old grandson is through the evaluations and skating with his new team. Our four-year-old grandson is about to start organized hockey. And not to be outdone, our three-year-old granddaughter is now on skates, announcing that she is going to play hockey just like her cousins. It seems like only yesterday that those two were learning to walk; how is possible that they are now skating?
Hockey, a new school year and fall leaves: as Forrest Gump would say, they go together like peas and carrots.
My column this week discusses the appeal of a previously digested trial decision on material nondisclosure.
Best,
Heather
Heather A. Sanderson, K.C.
Sanderson Law
Calgary, Alberta, Canada
[email protected]
Headlines from this week’s issue, attached:
KOHANE’S COVERAGE CORNER
Dan D. Kohane
[email protected]
- Suits Against Insurance Brokers for Failing to Procure Insurance Are Rarely Successful, Without Proof of a Request to Secure a Particular Kind of Insurance
- Providing Redacted Insurance Policies During Discovery, Even if Tardy, Did Not Deserve Ultimate Sanction of Dismissal
- First Department Decides Coverage Issues in NFL Concussion Class Action Litigation
PEIPER on PROPERTY (and POTPOURRI)
Steven E. Peiper
[email protected]
- Homeowners Policy Voided for Misrepresentation on Number of Families Residing in Home
LEE’S CONNECTICUT CHRONICLES
Lee S. Siegel
[email protected]
- No case this week. See you in two weeks.
RYAN’S FEDERAL REPORTER
Ryan P. Maxwell
[email protected]
- Professional Engineer’s Pre-Notice Acceptance of Liability Vitiated Errors & Omissions Coverage for Claims Involving Non-Conforming Beams
STORM’S SIU
Scott D. Storm
[email protected]
- In a 1st Party Property Claim Where Co-Owners Hold Title to a Property as Tenants in Common and Only One Owner Insurers His Interest Through a Policy, Policy Language Limiting Recovery to the Insured’s “Interest at the Time of Loss,” Limits the Insured’s Recovery to His Interest in the Dwelling Damages (in this Case 50%).
A Mortgagee’s Right to Insurance Proceeds Can Be Cut Off Post-Loss if the Mortgage Debt Becomes Judicially Unenforceable Even Though an Insurable Interest Existed on the Date of Loss
- In a Third-Party Liability Claim Where Both Spouses Are Named Insureds, “Insured v. Insured” Injury Exclusion Is Dispositive Regardless of Later Changes in Residence or Title. Attempts to Manufacture Ambiguity From “Resident Spouse” Extensions Fail Where the Policy Clearly Defines “You”/“Insured” and Separately Excludes Injury to an Insured
FLEMING’S FINEST
Katherine A. Fleming
[email protected]
- “Not Covered” Addressed Scope of Coverage—Not Collectability of Payment—and Scheduled Underlying Carrier’s Insolvency Did Not Require Umbrella/Excess Insurer to Step Into Its Shoes
GESTWICK’S GARDEN STATE GAZETTE
Evan D. Gestwick
[email protected]
- Court Disallows Substitute Service on the Defendant’s Assumed Insurance Carrier
O’SHEA RIDES the CIRCUITS
Ryan P. O’Shea
[email protected]
- Insurance Representatives Qualify As Lay Witnesses, Not Expert Witnesses In Context Of Materiality On Misrepresentations In Policy Applications
LABARBERA’S LOWER COURT LIBRARY
Isabelle H. LaBarbera
[email protected]
- Insurer Not Bound to Prior Coverage Decision Where It Was a Non-Party and Its Policy Not at Issue; Use of a Vehicle as Something Other Than an Automobile Places Claim Beyond Scope of Auto Policy
LEXI’S LEGISLATIVE LOWDOWN
Lexi R. Horton
[email protected]
- Proposed Legislation Would Require Property/Casualty Insurers to Provide the Department of Financial Services Access to Underwriting Models or, When Those Models are Unavailable, Granular Claim Data
VICTORIA’S VISION ON BAD FAITH
Victoria S. Heist
[email protected]
- Eleventh Circuit Affirms Judgment on the Pleadings for Insurer Re: Florida’s Bad Faith Safe Habor
SHIM’S SERIOUS INJURY SEGMENT
Stephen M. Shimshi
[email protected]
- Appellate Division Reverses the Supreme Court’s Decision Granting Defendants’ Cross-Motion for Summary Judgment on the Issue of “Serious Injury”
NEW ENGLAND ALMANACK
Barbara A. O’Donnell
Alex G. Henlin
Iryna N. Dore
- Insurer Avoids Multiple Damages for Knowing and Willful Violations of M.G.L.c. 93A and 176D Because Amounts Awarded to Homeowners in Reference Proceedings on their Fire Loss Claim Were Not Reduced to Judgment and Plaintiffs Did Not Establish any Compensable Injuries from the Insurer’s Unfair Claims Handling Practices
NORTH of the BORDER
Heather A. Sanderson, K.C.
Sanderson Law
Calgary, Alberta, Canada
[email protected]
- A Request to Remove Building Coverage Is Not Notice of an Undisclosed Grow-Op
See you in two.
Dan
Hurwitz Fine P.C. is a full-service law firm providing legal services throughout the State of New York and providing insurance coverage advice and counsel in Connecticut, New Jersey, and across New England.
In addition, Dan D. Kohane is a Foreign Legal Consultant, Permit No. 0119144, issued by the Law Society of Upper Canada, and authorized to provide legal advice in the Province of Ontario on matters of New York State and federal law.
NEWSLETTER EDITOR
Dan D. Kohane
[email protected]
ASSOCIATE EDITOR
Evan D. Gestwick
[email protected]
INSURANCE COVERAGE/EXTRA CONTRACTUAL LIABILITY TEAM
Dan D. Kohane, Chair
[email protected]
Steven E. Peiper, Co-Chair
[email protected]
Michael F. Perley
Agnieszka A. Wilewicz
Lee S. Siegel
Barbara A. O’Donnell
Brian F. Mark
Scott D. Storm
Alexander G. Henlin
Iryna N. Dore
Ryan P. Maxwell
Katherine A. Fleming
Evan D. Gestwick
Ryan P. O’Shea
Isabelle H. LaBarbera
Lexi R. Horton
Victoria S. Heist
FIRE, FIRST PARTY AND SUBROGATION TEAM
Steven E. Peiper, Team Leader
[email protected]
Michael F. Perley
Scott D. Storm
NO-FAULT/UM/SUM TEAM
Jessica L. Deren
Ryan P. O’Shea
[email protected]
APPELLATE TEAM
Jody E. Briandi, Team Leader
[email protected]
Topical Index
Kohane’s Coverage Corner
Peiper on Property and Potpourri
Ryan’s Federal Reporter
Storm’s SIU
Fleming’s Finest
Gestwick’s Garden State Gazette
O’Shea Rides the Circuits
LaBarbera’s Lower Court Library
Lexi’s Legislative Lowdown
Victoria’s Vision on Bad Faith
Shim’s Serious Injury Segment
New England Almanack
North of the Border
KOHANE’S COVERAGE CORNER
Dan D. Kohane
[email protected]
10/07/26 Fritz, v. Kurmel Brokerage, Ltd
Appellate Division, Second Department
Suits Against Insurance Brokers for Failing to Procure Insurance Are Rarely Successful, Without Proof of a Request to Secure a Particular Kind of Insurance
In May 2020, the plaintiffs, Lincoln Fritz (”Lincoln”) and his brother Kenneth Fritz, commenced this action against the defendant Edward A. Kurmel Brokerage, Ltd. (”defendant”), an insurance broker, and another defendant, alleging, among other things, negligence and breach of contract by the defendant
Insurance brokers have a common law duty to obtain requested coverage for their clients within a reasonable time or inform the client of their inability to do so. 'Absent a specific request for coverage not already in a client's policy or the existence of a special relationship with the client, an insurance agent or broker has no continuing duty to advise, guide, or direct a client to obtain additional coverage
Here, the defendant established its prima facie entitlement to judgment as a matter of law dismissing the negligence and breach of contract causes of action insofar as asserted by Lincoln against it, respectively, by submitting, inter alia, a transcript of the deposition testimony of the defendant's president and other evidence which demonstrated that Lincoln did not make a specific request for a particular kind of insurance coverage that the defendant failed to procure). The defendant further established that there was no special relationship between it and Lincoln which would have given rise to an additional duty of care. In opposition.
10/06/26 Hanover, v. Speaker, M.D
Appellate Division, First Department
Providing Redacted Insurance Policies During Discovery, Even if Tardy, Did Not Deserve Ultimate Sanction of Dismissal
The Defendants apparently failed to produce applicable insurance policies during the discovery process and plaintiff’s counsel moved to sanction the defendants for discovery violations.
While defendants could have provided the relevant insurance coverage information with greater speed and concision, they provided colorable arguments for initially redacting the insurance documents. The provision of unredacted documents, amplified by further information defendants provided in response to the first order on appeal, demonstrate that defendants were not behaving in a "willful and contumacious" manner
10/01/26 Discover Property & Casualty Company v. NFL, et al
Appellate Division, First Department
First Department Decides Coverage Issues in NFL Concussion Class Action Litigation
The First Department’s October 1, 2026, decision in Discover Property & Casualty Co. v. National Football League, 2026 NY Slip Op 05595, is a significant insurance-coverage decision arising from the NFL concussion litigation. It addresses number of occurrences, products-completed operations coverage, continuous-injury trigger, consent to settlement, and settlement reasonableness.
Bottom line
The First Department held that:
- Each former player’s injury claim constitutes at least one separate occurrence. The court applied New York’s “unfortunate event” test and rejected TIG’s effort to aggregate thousands of players’ claims into a single occurrence. The head impacts involved different players, different locations, different times, and decades of play, and therefore lacked the temporal and spatial relationship necessary to constitute one occurrence.
- Because each player represents a separate occurrence, none reached the $51 million per-occurrence attachment point of AGLIC’s fifth-layer excess policy. Accordingly, AGLIC had no duty to indemnify the NFL under its 2001–2002 excess policy.
- NFL football is not a “product” for purposes of the Products-Completed Operations Hazard. The court reversed Supreme Court on this point. Reading the policy’s definition of “your product” in context, the First Department held that the provision concerns tangible, physical products, not an intangible entertainment product such as professional football. Therefore, the PCOH aggregate limit does not apply to the concussion claims.
- The Participants Endorsement was particularly important. The endorsement placed bodily injury to players within Coverage D, rather than Coverage A, and Coverage D was subject to the per-occurrence limit but not the PCOH aggregate. The applicable TIG policy apparently had no general aggregate limit.
Occurrence / expected-or-intended injury
TIG argued that injuries from football could not be “occurrences” because violent physical impacts are inherent in the game. The court rejected that argument because the relevant injury was not the intentional physical contact itself, but the alleged development of neurodegenerative disease.
The expected-or-intended exclusion therefore turns on whether the NFL expected or intended the resulting neurological disease, not whether it expected players to be struck during games.
TIG had not established that proposition as a matter of law.
Trigger of coverage — injury in fact
For the long-tail neurological injuries, the court reaffirmed that New York follows the injury-in fact trigger.
Coverage is triggered when the injury, sickness, or disease actually begins, even though it may be undiscovered or unmanifested at the time. The NFL ultimately must establish facts showing that qualifying neurological injury existed during the relevant policy periods, but G was therefore inappropriate.
This is an important long-tail coverage point: manifestation is not required; a real but undiscovered injury during the policy period can trigger coverage.
Late notice
Neither side won summary judgment on notice.
TIG claimed that the NFL knew about concussion claims in 2010 but did not give notice until August 2011. The NFL argued that its policies required notice when a claim was made or suit brought and that notice within approximately two weeks of the first lawsuit was timely.
The problem was evidentiary: the record did not establish when the NFL actually received a “claim.” Thus, the First Department held that neither side could establish timeliness or untimeliness as a matter of law.
The NFL suffered an insurable “loss”
TIG also argued that the NFL itself had no loss because the 32 member Clubs funded NFL expenses and liabilities.
The court rejected that defense. The NFL is an unincorporated association, and payments by its constituent members amounted to payment by the insured organization itself—not reimbursement by an independent third-party indemnitor.
The court also invoked the New York rule that an insured’s insurable interest generally is not reduced merely because collateral arrangements may relieve it of part of the economic burden of the loss. Accordingly, TIG’s “no loss” defense was dismissed.
Consent to settlement / repudiation
This portion of the decision remains fact dependent. Ordinarily, compliance with a policy’s consent-to-settlement clause is a condition precedent. But an insurer that repudiates coverage may relieve the insured of the obligation to obtain consent.
The First Department noted evidence potentially supporting repudiation:
- TIG repeatedly reserved rights;
- TIG refused consent to settlement;
- TIG sought privileged defense files that the First Department had previously held it was not entitled to obtain;
- TIG asserted crossclaims seeking to limit or eliminate coverage; and an insurer cannot arbitrarily withhold consent and simultaneously rely upon the insured’s failure to obtain that consent.
However, the court found questions of fact concerning whether TIG’s conduct and crossclaims actually amounted to repudiation and whether its withholding of consent was improper. So that issue survives.
Reasonableness of the NFL concussion settlement
Here, the NFL won the battle:
The First Department held that the MDL settlement was reasonable as a matter of law.
- Relevant considerations included:
- more than 20,000 retired players were covered;
- the settlement extinguished concussion-related claims;
- it established an uncapped monetary award fund extending over 65 years;
- individual benefits could reach millions of dollars;
- it included a $75 million neurological assessment program;
- continued litigation was extraordinarily complex and expensive;
- both the federal district court and Third Circuit had found the settlement fair and reasonable; and
- TIG had been kept informed and was asked for consent numerous times.
The First Department therefore dismissed TIG’s unreasonable settlement defense.
For coverage lawyers, the decision is especially noteworthy for these propositions:
- Number of occurrences: common causation theories do not automatically aggregate claims. Under the unfortunate-event test, courts focus on the actual incidents giving rise to injury and their temporal/spatial relationship.
- Grouping language has limits: language combining injuries from “continuous or repeated exposure to substantially the same general conditions” did not turn thousands of spatially and temporally distinct football impacts into one occurrence.
- Defined policy terms control over colloquial meaning: a court cannot pull the word “product” out of the defined phrase “your product” and give it a broader common-speech meaning.
- PCOH means tangible products in this policy context: professional football as an entertainment enterprise was not the relevant “product.
- Expected/intended injury focuses on the damage, not merely the intentional conduct producing it.
- Injury-in-fact remains New York’s trigger for continuous-exposure bodily-injury claims.
- Repudiation can arise from litigation conduct, including assertions in pleadings, although whether TIG crossed that line here remained a factual issue.
- An insurer given notice of a claim generally cannot defeat an objectively reasonable settlement simply because it believes it could have negotiated a better deal.
The operative disposition was to grant AGLIC summary judgment declaring no duty to indemnify, declare each player's claim at least one separate occurrence, declare that NFL football is not a product under the PCOH, declare the MDL settlement reasonable, and dismiss TIG's unreasonable-settlement and “no loss” defenses. The remaining factual issues include notice and aspects of TIG's consent/repudiation defense.
PEIPER on PROPERTY (and POTPOURRI)
Steven E. Peiper
[email protected]
10/07/26 Alarcon v. Otsego Mutual Fire Insurance Company
Appellate Division, Second Department
Homeowners Policy Voided for Misrepresentation on Number of Families Residing in Home
In July 2015, the plaintiff purchased a house in Bay Shore. The plaintiff's broker filled out an application for the plaintiff for homeowners' insurance with the defendant Otsego Mutual Fire Insurance Company. In the application, the plaintiff's broker represented, among other things, that the number of families in the dwelling was one. Based on that information, the defendant issued a homeowners' insurance policy with the plaintiff as the named insured. The homeowners' insurance policy was thereafter renewed.
In or about January 2020, the plaintiff made a claim under the homeowners' insurance policy for water damage sustained when a pipe broke. In investigating the claim, the defendant purportedly discovered that the house had three separate apartment units, each with its own kitchen, bathroom, space for living and sleeping, and access to the outside without having to pass through any other apartment. As a result, the Otsego concluded that the house was a three-family dwelling, denied coverage and advised that the policy was void due to misrepresentations,
To establish the right to rescind an insurance policy, an insurer must show that its insured made a material misrepresentation of fact when he or she secured the policy. A representation is a statement as to past or present fact, made to the insurer by, or by the authority of, the applicant for insurance or the prospective insured, at or before the making of the insurance contract as an inducement to the making thereof" (Insurance Law § 3105] A misrepresentation is material if the insurer would not have issued the policy had it known the facts misrepresented. To establish materiality as a matter of law, the insurer must present documentation concerning its underwriting practices, such as underwriting manuals, bulletins, or rules pertaining to similar risks, that show that it would not have issued the same policy if the correct information had been disclosed in the application.
Here, the plaintiff's own testimony, along with photographs and floor plans, established, prima facie, that the house was structurally configured as a three-family dwelling, and thus, the statement on the plaintiff's insurance application indicating that it was a one-family dwelling was a misrepresentation. Contrary to the plaintiff's contention, "the number of families is determined by actual use, even if in violation of the certificate of occupancy" Further, the Otsego established, prima facie, that the plaintiff's misrepresentation was material by submitting, inter alia, an affidavit from its Director of Underwriting, along with its 2015 Downstate Underwriting Guidelines, which established that the defendant did not insure three-family dwellings and would not have issued the policies if the plaintiff had disclosed that the house contained three dwelling units.
The plaintiff claimed that the policy application was ambiguous. Here, the question on the application asking for the "#FAMILIES" was not ambiguous. Moreover, the plaintiff admitted that she did not read the application before she signed it, she could not have been misled by any unclear language
LEE’S CONNECTICUT CHRONICLES
Lee S. Siegel
[email protected]
No case this week. See you in two weeks.
RYAN’S FEDERAL REPORTER
Ryan P. Maxwell
[email protected]
09/30/26 Tindall Corp. v. Berkley Assurance Co.
Second Circuit Court of Appeals
Professional Engineer’s Pre-Notice Acceptance of Liability Vitiated Errors & Omissions Coverage for Claims Involving Non-Conforming Beams
Tindall Corporation purchased an errors and omissions policy from Berkley Assurance Company covering October 1, 2019, to October 1, 2020, which made it a condition precedent to coverage that Tindall does not admit any liability without Berkley’s prior written consent. On a Philadelphia renovation project, Tindall designed concrete beams and later discovered they did not meet specifications in certain locations. Tindall’s head of engineering told the contractor that some conditions did not meet the contract documents and Tindall subsequently acknowledged “nonconforming” portions of its work, obtained engineering opinions that the issues could be remedied, and told the property owner it was prepared to immediately implement corrective measures affecting every beam. It was only after the owner approved the plan and Tindall had identified contractors did Tindall notify Berkley of a potential claim.
Specifically, notice was provided to Berkley on April 13, 2020, and repair work began on May 26, 2020. Berkley denied coverage on June 16, 2020, on the basis that Tindall had already conceded responsibility in the fall of 2019. More specifically, Berkley denied coverage on the ground that Tindall had admitted liability without the required consent. Following motion practice on the issue, the district court granted summary judgment to Berkley and Tindall appealed.
The Second Circuit noted that the policy made consent a condition precedent to coverage and prohibited the insured from admitting liability without Berkley’s prior written consent, while expressly rejecting Tindall’s argument that only a formal settlement could trigger the clause. Such a reading would render the separate “admit liability” prohibition meaningless. Tindall’s letters acknowledging nonconforming work and committing to comprehensive corrective measures constituted an admission of liability, and the undisputed record showed Tindall proceeded with remediation planning before notifying Berkley, breaching the condition precedent.
Dispelling various other arguments, the Second Circuit noted that Berkley need not show prejudice because compliance with the no-admission condition was a condition precedent to coverage, and New York’s statutory prejudice requirement for late notice does not extend to admission-of-liability clauses. It also found Vigilant Ins. v. Bear Stearns inapposite because that case addressed a settlement prohibition where the insured expressly disclaimed liability, unlike Tindall’s admissions here. Finally, the court rejected Tindall’s estoppel theory for failure to show detrimental reliance, because Tindall had already admitted responsibility in 2019, began repairs before Berkley’s June 2020 denial, and continued after denial, such that it did not change position in reliance on Berkley’s silence.
With no genuine dispute of material fact, the court affirmed summary judgment for Berkley.
STORM’S SIU
Scott D. Storm
[email protected]
09/29/26 Adirondack Ins. Exchange v. HSBC BANK, USA, N.A., et al.
United States District Court, N.D. New York
In a First Party Property Claim Where Co-Owners Hold Title to a Property as Tenants in Common and Only One Owner Insurers His Interest Through a Policy, Policy Language Limiting Recovery to the Insured’s “Interest at the Time of Loss,” Limits the Insured’s Recovery to His Interest in the Dwelling Damages (in this Case 50%). A Mortgagee’s Right to Insurance Proceeds Can Be Cut Off Post-Loss if the Mortgage Debt Becomes Judicially Unenforceable Even Though an Insurable Interest Existed on the Date of Loss
The matter comes on cross-motions for partial summary judgment in a federal statutory interpleader seeking declarations about rights to homeowners insurance proceeds after a residential fire. The court denies HSBC’s motion and grants Adirondack’s motion.
The plaintiff is Adirondack Insurance Exchange. The defendants are HSBC Bank (mortgagee); Steven A. Bresler (named insured); and Gerry-Lynn Stohr (former spouse – not a named insured and residing elsewhere). Bresler and Stohr are co-owners of the property. Adirondack has deposited interpleader funds with the Court under 28 U.S.C. § 1335.
The property in Woodstock, N.Y. was purchased by Bresler and Stohr while married; they divorced in 2013. The divorce converted their tenancy by the entirety to a tenancy in common. The record indicates they are 50/50 owners, and their marital agreement contemplated equal division of net sale proceeds.
In March 2007, Bresler and Stohr borrowed $650,000 and granted a mortgage. The mortgage required hazard insurance with a standard mortgage clause naming the lender. Adirondack issued the homeowners policy to Bresler as the sole named insured and HSBC is listed as mortgagee. The policy pays Coverage A - Dwelling losses “to the mortgagee and you, as interests appear,” and limits any insured’s recovery to the amount of that insured’s interest at the time of loss.
A fire occurred on October 5, 2022, damaging the dwelling. On January 5, 2023, Bresler submitted a Sworn Statement in Proof of Loss claiming $674,277.91; he acknowledged a mortgage encumbrance and does not dispute that the amount due on the note/mortgage at the time exceeded the dwelling loss.
Defaults on the mortgage began around 2011. HSBC had previously commenced a separate foreclosure action. HSBC’s first Ulster County foreclosure (Nov. 2012) was dismissed for failure to proceed. After sending a “de-acceleration” letter, HSBC filed a second foreclosure in December 2018. The trial court in that action dismissed it as time-barred; in November 2022, on appeal the Third Department reinstated the action as timely based on the clarity of the de-acceleration. On December 30, 2022, New York enacted the Foreclosure Abuse Prevention Act (FAPA), effective immediately and applicable to pending actions. FAPA curtailed lenders’ ability to reset limitations periods via unilateral de-acceleration. On renewal in 2025, the Third Department held FAPA rendered HSBC’s de-acceleration “no longer impactful” and dismissed the foreclosure as untimely. New York’s Court of Appeals and the Second Circuit have since upheld FAPA’s retroactive application against constitutional challenges.
The issues in this case include:
- Whether HSBC, as mortgagee, has a right to recover any Coverage A proceeds under the policy following the fire.
- Whether recovery under the policy is limited to Mr. Bresler’s 50% ownership interest in the dwelling.
- Whether Stohr has any right of recovery given she is not a named insured and has not appeared in the litigation.
Holdings:
HSBC’s motion for partial summary judgment is denied. The court holds HSBC cannot recover under the policy because, after the loss, its foreclosure was dismissed as time-barred and its insurable interest terminated.
New York Insurance Law § 3401 requires an insurable interest—defined as a lawful and substantial economic interest in the property’s preservation. Although insurable interest is ordinarily measured at the time of loss, New York recognizes that a mortgagee’s post-loss actions or legal developments can terminate the mortgagee’s right to recover (e.g., satisfaction, assignment, or extinguishment of the debt).
After the fire, the Third Department dismissed HSBC’s foreclosure as time-barred in light of FAPA. The federal court found no New York case directly on point about a post-loss statute-of-limitations dismissal but reasoned from Whitestone and related cases that a mortgagee’s post-loss right can be impaired by extinguishment of the enforceable debt interest. Because HSBC is barred from enforcing or collecting on the note and mortgage, it lacks a continuing lawful and substantial economic interest in the property and thus has no insurable interest remaining to support a policy recovery. Election-of-remedies principles under RPAPL § 1301 and the judicial determination of untimeliness further support this conclusion. Accordingly, HSBC cannot recover under the policy, and its motion is denied.
Adirondack’s motion is granted. The court declares that Bresler’s insurable interest in the dwelling under the policy is limited to his 50% ownership interest. The court otherwise denies Adirondack’s request to declare that Stohr has no right of recovery (permitting a default judgment motion).
Following the divorce, the owners hold as tenants in common 50/50. The policy limits any insured’s recovery to the amount of that insured’s interest at the time of loss. Bresler is the sole named insured and offered no legal argument that his policy recovery should exceed his 50% ownership. The court therefore declares his insurable interest under the policy is limited to 50% of the dwelling’s value
Stohr’s is not a named insured and has not appeared in the case. The court declines, without prejudice, to declare that she has no right of recovery; Adirondack may pursue a motion for default judgment for this relief.
09/28/26 Amica v. Ambrosio
United States District Court, Eastern District of New York
In a Third-Party Liability Claim Where Both Spouses Are Named Insureds, “Insured v. Insured” Injury Exclusion Is Dispositive Regardless of Later Changes in Residence or Title. Attempts to Manufacture Ambiguity From “Resident Spouse” Extensions Fail Where the Policy Clearly Defines “You”/“Insured” and Separately Excludes Injury to an Insured
Memorandum and Opinion granting Amica’s motion for summary judgment in a declaratory judgment action concerning Amica’s duties to defend and indemnify under a homeowners policy and a personal umbrella policy for claims brought by Joann against Donald in a pending New York state lawsuit.
Amica began issuing homeowners and umbrella policies to the Ambrosios in 2012 while they were married and living in Commack, New York. The last renewals ran August 24, 2022, to August 24, 2023. Both Joann and Donald were named insureds throughout that period. The policies define “you” and “your” to mean the named insured, and “insured” to mean “you.” Both policies exclude coverage for bodily injury to “you” or “an insured” (homeowners) and for bodily/personal injury to “you” (umbrella).
Underlying incident and suit: On June 27, 2023, while visiting her daughter at the home, Joann reported that Donald pushed her, causing a fall and wrist injuries; she was transported by ambulance. On May 24, 2024, Joann sued Donald in Suffolk County Supreme Court, alleging negligence and assault/battery arising from the June 27, 2023, event.
A June 16, 2021, separation agreement required Joann to stop legally residing at the home, and a deed dated August 16, 2021, transferred ownership to Donald. Donald filed for divorce May 22, 2023; the uncontested divorce was submitted September 21, 2023, and a judgment of divorce entered on that date. The divorce judgment kept Joann as a named insured on Amica’s auto policy (and therefore the umbrella, which also covered autos) until a defined “Maintenance Termination Event.” Joann did not reside at and did not own the home on the date of the incident.
Amica acknowledged the claim July 10, 2023, reserved rights, and identified potential issues including the “insured vs insured” exclusion. Amica disclaimed coverage August 7, 2023 (intentional-act and “injury to an insured” grounds), reaffirmed denial November 3, 2023, across homeowners, umbrella, and auto, and again reaffirmed on August 13, 2024, after the lawsuit was filed. Despite denying coverage, Amica has been providing a courtesy defense to Donald in the state action under a reservation of rights.
Amica filed this declaratory judgment action June 12, 2025. Amica moved for summary judgment, relying on the policies’ definitions and exclusions. The Ambrosios opposed, arguing a factual dispute about Joann’s residence and that the policies’ spousal language makes residency a condition relevant to the exclusion.
The court emphasized strict adherence to Local Rule 56.1 (Statements of Undisputed Material Facts supported by evidence required with summary judgment motions, which opposing parties must specifically respond to with admissions or denials also supported with corresponding evidence). Amica supported its statements with declarations and exhibits; the Ambrosios largely responded that they “can neither admit nor deny” without citing record evidence. The court deemed Amica’s properly supported facts admitted where not properly controverted.
The issues include:
- Whether Amica has a duty to defend or indemnify Donald for Joann’s claims under the homeowners and umbrella policies, given the policies’ exclusions for claims brought by an insured against an insured and the parties’ statuses as named insureds at the time of the incident.
- Whether Joann’s residence or ownership status at the time of the incident affects the applicability of the “insured vs insured” exclusion.
The Court recognized that in New York, the duty to defend is broader than the duty to indemnify and persists until it is certain there is no coverage; the insured bears the initial burden to show coverage; the insurer bears the burden to prove an exclusion; if an exclusion applies, the insured must show an exception. Policy terms are interpreted according to their plain meaning, giving effect to all provisions; ambiguity is a legal question and, if unresolved by extrinsic evidence, may be construed against the drafter.
The Court held that the policies unambiguously define “you” as the named insured(s) and exclude coverage for bodily injury to “you” or an insured (homeowners) and to “you” (umbrella). Both Donald and Joann were named insureds at the time of the June 27, 2023, incident and when Joann later sued Donald. Therefore, the “insured vs insured” exclusion applies squarely to bar coverage for Joann’s claims against Donald.
The Ambrosios’ argument that Joann needed to be a resident spouse to fall within the exclusion fails. The court held that the “resident spouse” language expands coverage to a spouse who resides with the named insured when that spouse is not otherwise a named insured; it does not alter or add a residency condition to the definitions of “you” or “insured,” nor to the exclusions. Reading a residency requirement into “you” or “insured” would render the policies’ explicit definitions meaningless.
The court assumed, arguendo, that Joann did not reside at the home and did not own it at the time of the incident. Even on those assumptions, the exclusion still applies because Joann remained a named insured. The court also rejected the claim that Joann’s lack of insurable interest in the real property eliminated her status as an insured; liability coverage does not require such an interest.
The court relied on Charnowitz v. GEICO and Davis v. Phillips, which held that where both plaintiff and defendant are named insureds, exclusions for injury to an insured bar coverage, and residence is irrelevant to that exclusion. The court found these decisions consistent with New York law and applied their reasoning to uphold Amica’s denial of coverage.
The court granted Amica’s motion for summary judgment in full, declaring that Amica has neither a duty to defend nor to indemnify Donald in the underlying Suffolk County action brought by Joann.
FLEMING’S FINEST
Katherine A. Fleming
[email protected]
09/21/26 A.R. Wilfley & Sons, Inc. v. Nat’l Union Fire Ins. Co. of Pittsburgh, PA
Colorado Supreme Court
“Not Covered” Addressed Scope of Coverage—Not Collectability of Payment—and Scheduled Underlying Carrier’s Insolvency Did Not Require Umbrella/Excess Insurer to Step Into Its Shoes
A.R. Wilfley & Sons, Inc. (“Wilfley”) manufactures pumps for mining and industrial operations and has been involved in litigation regarding alleged injuries from exposure to asbestos in its products. The underlying general liability polies issued by one carrier were exhausted through settlements and the payment of claims. Another primary carrier, Reliance Insurance Company (“Reliance”) issued general liability policies, but those policies became uncollectable due to its insolvency. Federal Insurance Company (“Federal”) issued at least three umbrella/excess policies to Wilfley, and Wilfley contended that Federal was required to step down and defend and indemnify as Reliance was the last-standing underlying primary insurer. Federal agreed to defend under a reservation of rights. When Federal denied coverage, Wilfley filed suit in the United States District Court for the District of Colorado, seeking defense and indemnity for claims that would have fallen within Reliance’s scheduled primary policies had the carrier remained solvent.
Under the Federal Policies, Federal’s defense obligations only arose when an occurrence was “not covered” by any underlying insurance but was covered under the terms of the Federal Policies. The Federal Policies’ maintenance of underlying insurance condition required Wilfley to maintain the underlying primary insurance in full force and stated that Federal’s obligations did not come into play until the applicable underlying limits were paid—whether by Wilfley or by one of its underlying insurers.
Wilfley argued that because the benefits available under Reliance’s scheduled underlying policies had become uncollectable due to the carrier’s insolvency, the claims were “not covered” by those policies. Thus, Wilfley asked Federal to provide the primary coverage Reliance could not furnish. Federal argued that its policies did not convert it into a stand-in for the insolvent primary carrier and that the phrase “not covered” referred to whether the occurrence fell within the scope of the underlying policies.
The district court considered whether the insolvency of a scheduled underlying insurer can trigger an umbrella/excess policy. The district court concluded that Federal did not have defense or indemnity responsibilities until the underlying limits had been exhausted or paid by Wilfley. The district court rejected Wilfley’s equating of coverage with collectability, reasoning that an occurrence did not become “uncovered” because an insurer could not or would not pay.The Colorado Supreme Court accepted the certified question as to whether based on the insuring agreement and defense provision language in the excess insurance umbrella policy, the excess/umbrella carrier was obligated to “step into the shoes” of the insolvent underlying primary carrier by providing first-dollar indemnity and defense costs to the insured that otherwise would have been paid by the insolvent carrier. The Court answered in the negative as an umbrella/excess insurer does not become the primary insurer’s stopgap—or inherit its obligations—simply because the primary insurer becomes insolvent. Based on the Federal Policies’ language, Federal did not agree to defend Wilfley against claims for which a scheduled underlying insurer provided coverage or agreed to indemnify before the underlying coverage had been exhausted. While Wilfley interpreted “covered” to encompass collectability, the Court reasoned that the interpretation did not reflect the parties’ intent to distinguish between the existence of coverage through a scheduled underlying insurer and the collectability of coverage from an unscheduled insurer. An occurrence covered by Reliance’s scheduled underlying policies remained covered even though the carrier had become insolvent, and the Federal policies could only be triggered by occurrences that were “not covered” by Reliance’s policies or when the underlying limits had been exhausted. Accordingly, the Court found that the Federal Policies were not triggered and having answered the certified question, the Court returned the case to the federal district court to resume proceedings consistent with the opinion.
GESTWICK’S GARDEN STATE GAZETTE
Evan D. Gestwick
[email protected]
09/25/26 Jean v. C & Fam. Trucking, LLC
United States District Court, District of New Jersey
Court Disallows Substitute Service on the Defendant’s Assumed Insurance Carrier
The plaintiff commenced a lawsuit against the defendants following a June 5, 2025, collision on the New York side of the George Washington Bridge. The plaintiff later attempted, unsuccessfully, to serve the defendants with a copy of the lawsuit as required by the rules of civil procedure. As such, the plaintiff sought the Court’s permission to serve the defendants through the insurance carrier listed on the police report (GEICO).
To proceed with substitute service under New Jersey law, the serving party must first demonstrate that they exercised due diligence in serving the other party via the standard conventions (i.e., personal service, via a person of suitable age and discretion, or via authorized agent). To show due diligence, serving parties are required to follow upon information that they either already possess, or can obtain through reasonable efforts, pursue reasonable leads, and utilize reasonably available methods to locate the party they wish to serve. If all else fails, the serving party may seek permission from the Court to effect service using another method, in which case, the court analyzes whether the proposed alternate method of service would comport with due process considerations.
Here, the plaintiff submitted affidavits of services by her process servers indicating that they attempted to personally serve each defendant at least three times, to no avail. However, those affidavits of service did not indicate how it was determined that the defendants were affiliated with the addresses at which service was attempted, neither did the process servers indicate whether any additional measures were taken to ascertain the defendants’ locations. The Court therefore found that the plaintiffs failed to show that they exercised due diligence in serving the defendants via standard conventions prior to seeking leave to effect service via alternative methods.
The Court continued in its opinion by noting that, even if the plaintiffs did exercise due diligence in effecting service on the defendants, plaintiff’s proposed alternate service method of serving GEICO would not comport with the notions of due process. While courts, in other circumstances, sometimes permit service on a defendant through that defendant’s insurer, such a result is typically reserved for situations in which the plaintiff has already confirmed that the insurer sought to be served was in fact the defendant’s insurer. Here, the plaintiff submitting nothing to confirm that GEICO, in fact, insured the defendants; instead, plaintiff only relied on the insurance code that was included on the police report. Without confirmation that GEICO actually insured the defendants, the Court refused to allow the plaintiffs to effect substitute service on GEICO.
Editor’s Note: The takeaway here is to be alert, if not skeptical, the next time a plaintiff attempts to serve an insurer with a lawsuit meant for the insured. Technically speaking, plaintiffs are required to obtain the Court’s permission before even attempting service in this manner and are required to serve the insurer with a copy of their motion. In circumstances like this case, it might be wise for an insurer to enter a limited appearance for the purpose of contesting the motion.
O’SHEA RIDES the CIRCUITS
Ryan P. O’Shea
[email protected]
10/06/26 United States v. Wilson
United States Court of Appeals, Fourth Circuit
Insurance Representatives Qualify As Lay Witnesses, Not Expert Witnesses In Context Of Materiality On Misrepresentations In Policy Applications
Wilson appealed his criminal conviction regarding an insurance fraud scheme. From 1993 through 2018, Wilson obtained approximately $25 million in life insurance coverage for four clients by misrepresenting the clients’ health status, wealth and current coverage in policy applications. Wilson also forged signatures to change the owners and policy beneficiaries to himself. He also defrauded investors to raise funds to pay for the policy premium.
The U.S. Govt. presented testimony of six insurance company representatives who testified that information regarding the insured’s health, financial information, and existing coverage were necessary variables to inform policy issuance decisions.
The Circuit Court found the insurance representatives constituted sufficient lay witnesses under Fed. R. Evid. 602. The representatives acquired personal knowledge of their employers’ underwriting practices through day-to-day work experience. One witness was a chief underwriter. The court also rejected Wilson’s argument the representatives’ testimony violated Fed. R. Evid. 701, since the representatives could be considered experts. The representatives stated t insurers consider a person’s history of smoking, heart attacks, level of income, and amount of pre-existing coverage material to an insured’s policy application. The court reasoned this testimony does not need expert knowledge or training to understand that the above application inquiries impact an insurer’s choice to underwrite a risk.
Based on the above, and several other reasons, Wilson’s conviction was affirmed.
LABARBERA’S LOWER COURT LIBRARY
Isabelle H. LaBarbera
[email protected]
10/06/26 Rock Group, et al. v, Allstate Ins. Co., et al
New York State Supreme Court, New York County
Insurer Not Bound to Prior Coverage Decision Where It Was a Non-Party and Its Policy Not at Issue; Use of a Vehicle as Something Other Than an Automobile Places Claim Beyond Scope of Auto Policy
Rock Group NY Corp and Southwest Marine and General Insurance Company (“Plaintiffs”) filed an action against Allstate Insurance (“Allstate”), New M&M Group Inc (“M&M”), and Wesco Insurance Company (“Wesco”).
The coverage action arose from an underlying construction accident claim in Kings County. The underlying action alleged the clamant was injured when a 32 ft beam fell on top of him. The claimant asserted the cause of the injury was the improperly installed beam in his Bill of Particulars. At his deposition, the claimant stated he lifted the beam while it was being installed into a scaffolding bridge. The claimant stood in the bed of a Rock Group truck as he hoisted the beam that fell on him.
Rock Group commenced a prior declaratory judgment action seeking additional insured overage under a general liability policy issued to New M&M by Certain Underwriters at Lloyd’s, London (“Lloyds”). In the prior declaratory judgment action, the First Department found that Lloyds did not owe Rock Group coverage, because the incident arose from the “loading and unloading” of property from a vehicle, and therefore, coverage was excluded under the Lloyds policy’s Auto Exclusion. Allstate was a non-party to Rock Group’s prior coverage action against Lloyds.
Based on the First Department decision in the prior action, Plaintiffs filed the present action against Allstate since Allstate insured Rock Group under an auto policy.
Plaintiffs then moved for summary judgment based upon the First Department decision. Allstate opposed the motion and separately moved for summary judgment asserting the accident did not arise out of the use of an auto, since the claimant used the truck as an elevated construction platform, not an automobile.
As an initial matter, the Court discussed the sufficiency of Plaintiffs’ moving papers. Here, Plaintiffs did not attach a complete set of the pleadings, or a complete copy of the Allstate automobile policy, under which they seek coverage.
The Court found that either of these deficiencies requires denial of the motion. However, the Court’s discussion did not end there. The Court found that even if it were to reach a decision on the merits of Plaintiffs’ motion, Plaintiffs failed to meet their burden that there is coverage under the Allstate automobile policy.
The Court found the evidence undisputedly showed that the accident did not arise out of the ownership, maintenance, or use of an auto. The evidence showed the flatbed remained stationary for hours, laden with construction materials, and was solely used to construct the elevated scaffolding bridge, rather than for transportation and loading/unloading.
The Court reasoned that automobile liability coverage applies only where a vehicle is being used as a motor vehicle, and “is the instrumentality of the injury.” The Court cited noted prior precedent that when a vehicle is used as something other than an automobile, auto coverage does not apply and hence, no coverage applied under the Allstate auto policy.
The Court also reasoned that Allstate was not subject to collateral estoppel or issue preclusion from the prior First Department decision. This was due to the fact Allstate was a non-litigant to the prior coverage action and coverage under the Allstate policy was not previously contested. Thus, Allstate did not receive a full and fair opportunity to litigate the issue.
In sum, the Court found that Allstate submitted admissible evidence, demonstrating that the accident did not arise out of the use of a covered automobile. The Court granted Allstate’s motion in its entirety, finding that it owes no duty to defend or indemnify Rock Group in the underlying action.
Editor’s Note: A copy of this decision is available upon request.
LEXI’S LEGISLATIVE LOWDOWN
Lexi R. Horton
[email protected]
10/09/26 New York Assembly Bill A11724
New York State Assembly
Proposed Legislation Would Require Property/Casualty Insurers to Provide the Department of Financial Services Access to Underwriting Models or, When Those Models are Unavailable, Granular Claim Data
Assembly Bill A11724 was introduced on September 16, 2026, and referred to the Assembly Insurance Committee. The bill would add a new Insurance Law § 338 governing regulatory access to underwriting models and claim data.
Upon request of the Superintendent of Financial Services, every property/casualty insurer authorized to do business in New York would be required to provide mutually agreed Department staff access to its underwriting models. The bill defines an “underwriting model” as an algorithm, formula, or structured methodology used to assess risk, determine premiums, or evaluate eligibility for coverage.
If an underwriting model is unavailable, the insurer would instead be required to provide granular claim data sufficient for the Department to evaluate the insurer’s underwriting practices and risk-assessment methodologies. “Granular claim data” includes detailed, record-level claim information such as claim type, amount, date, geographic location, and resolution status.
Information provided under the proposed law would remain subject to applicable state and federal confidentiality protections and could be maintained by Department staff solely for regulatory purposes. Failure to comply could result in penalties under Insurance Law § 109, including fines and suspension or revocation of the insurer’s license. If enacted, the legislation would take effect ninety days after becoming law.
VICTORIA’S VISION ON BAD FAITH
Victoria S. Heist
[email protected]
10/05/26 Chambers v. Progressive Select Ins. Co.
Eleventh Circuit Court of Appeals
Eleventh Circuit Affirms Judgment on the Pleadings for Insurer Re: Florida’s Bad Faith Safe Habor
Angela Borrero caused a motor vehicle accident in 2018 that resulted in catastrophic injuries to motorcyclist James Spalding. Borrero was insured by Progressive with bodily injury limits of $10,000/$20,000 and a $10,000 property damage limit. Progressive promptly tendered its $10,000 bodily injury limits and, within 72 days of receiving Spalding's documented property damage demand, offered the full amount demanded plus interest. Spalding rejected the settlement offer. The bodily injury claim went to trial, and Spalding obtained a $7.49 million judgment against Borrero in April 2023 for the bodily injury claim, and Borrero later filed bankruptcy. The bankruptcy trustee then brought a third-party bad faith action against Progressive.
The district court granted judgment on the pleadings in favor of Progressive based on Florida's 2023 amendment to Fla. Stat. § 624.155(4)(a), which created a 90-day safe harbor barring bad faith claims where an insurer tenders the lesser of the policy limits or the amount demanded within 90 days of receiving sufficient evidence supporting the claim.
The Eleventh Circuit affirmed. The court held that a Florida third-party bad faith claim does not accrue until an excess judgment is entered against the insured. Because the excess judgment was entered in April 2023, after the effective date of the statutory amendment, the safe harbor applied prospectively rather than retroactively. The court rejected arguments that application of the statute impaired contractual rights or violated due process, reasoning that a third-party bad faith claim is an extra-contractual cause of action that does not exist until an excess judgment is entered. Since Progressive tendered both the bodily injury policy limits and the full property damage demand within the statutory 90-day period, the safe harbor barred the trustee's bad faith claim as a matter of law.
SHIM’S SERIOUS INJURY SEGMENT
Stephen M. Shimshi
[email protected]
09/30/26 Abdullah v. City of New York
Appellate Division, Second Department
Appellate Division Reverses the Supreme Court’s Decision Granting Defendants’ Cross-Motion for Summary Judgment on the Issue of “Serious Injury”
Plaintiff David Abdullah ("plaintiff") commenced this action to recover for personal injuries sustained in connection with a motor vehicle accident that occurred when his vehicle was struck in the rear by a vehicle owned by defendant City of New York and operated by Wojciech Szczech ("Szczech"). Plaintiff filed a summary judgment motion on the issue of liability and to dismiss the defendants’ affirmative defense alleging comparative fault. Defendants opposed the motion and filed a cross-motion for summary judgment to dismiss the complaint on the ground that plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d) as a result of the subject accident. The Supreme Court granted the defendants’ cross-motion and denied the plaintiff's summary judgment motion in an Order dated January 14, 2025. The plaintiff now appeals.
Serious Injury:
According to the Appellate Division, Second Department, defendants demonstrated, prima facie, that plaintiff did not sustain a serious injury under the permanent consequential limitation of use or significant limitation of use categories of Insurance Law § 5102(d) (see Staff v Yshua, 59 AD3d 614, 874 N.Y.S.2d 180). However, on opposition, the plaintiff raised a triable issue of fact as to whether he sustained serious injuries to his left shoulder and the cervical and lumbar regions of his spine under the permanent consequential limitation of use and significant limitation of use categories of Insurance Law § 5102(d) (see Perl v Meher, 18 NY3d 208, 960 N.E.2d 424, 936 N.Y.S.2d 655).
The defendants also failed to establish, prima facie, that the plaintiff's alleged left shoulder and the cervical and lumbar regions of his spine injuries were not caused related to the accident (see Holliday v City of New Rochelle, 243 AD3d 648, 649, 245 N.Y.S.3d 297; Zennia v Ramsey, 208 AD3d 735, 735, 171 N.Y.S.3d 921; Luigi v Avis Cab Co., Inc., 96 AD3d 809, 949 N.Y.S.2d 61; Reyes v Diaz, 82 AD3d 484, 917 N.Y.S.2d 632). Therefore, the burden never shifted to the plaintiff to raise a triable issue of fact as to causation (see Holliday v City of New Rochelle, 243 AD3d at 649; Valdez v Classic Hauling, LLC, 233 AD3d 959, 960, 223 N.Y.S.3d 283; Skeldon v Faessler, 219 AD3d 851, 853, 195 N.Y.S.3d 277).
Based on the above, the Appellate Division, Second Department, found that the Supreme Court should have denied the defendants' cross-motion for summary judgment dismissing the complaint on the ground that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d) in connection with the subject accident.
Summary Judgment (on the issue of liability):
The Appellate Division, Second Department, found that the plaintiff's submissions, namely the parties’ deposition testimony and a video depicting the accident, established the plaintiff's entitlement, prima facie, to judgment as a matter of law on the issue of the defendants’ liability by showing that the defendant driver was at fault in striking the rear of the plaintiff's vehicle while the plaintiff was stopped for a traffic condition (see Laureano v EAN Holdings, LLC, 225 AD3d 754, 756, 207 N.Y.S.3d 153; Newman v Apollo Tech Iron Work Corp., 188 AD3d 902, 903, 135 N.Y.S.3d 133).
The plaintiff also demonstrated that he was not at fault in the happening of the accident and that the defendant’s negligence was the sole proximate cause of the accident (see Ali v Alam, 223 AD3d at 644; Seizeme v Levy, 208 AD3d 809, 811, 174 N.Y.S.3d 421). In opposition, the defendants failed to raise a triable issue of fact. As such, the Appellate Division, Second Department, found that the Supreme Court should have granted the plaintiff's motion for summary judgment on the issue of liability and dismissed the affirmative defense alleging comparative fault.
NEW ENGLAND ALMANACK
Barbara A. O’Donnell
[email protected]
Alexander G. Henlin
[email protected]
Iryna N. Dore
[email protected]
09/21/26 Deutsch v. Privilege Underwriters Reciprocal Exchange
Commonwealth of Massachusetts, Suffolk County Superior Court Business Litigation Session
Insurer Avoids Multiple Damages for Knowing and Willful Unfair Claims Handling Violations of M.G.L.c. 93A and 176D Because Amounts Awarded to Homeowners in Reference Proceedings Regarding Fire Loss Claim Were Not Reduced to Judgment
Relying on prior Massachusetts Supreme Court decisions, including Bonofiglio v.
Commercial Union Ins. Co., 411 Mass. 31, 37 (1991), a Business Litigation Session Judge (Salinger, J.) held that the owners of a large, historic residential property were not entitled to recover multiple damages for bench trial findings regarding their insurer’s knowing and willful violations of the Massachusetts Unfair Claims Handling Statute, M.G.L.c. 176D, and Unfair Business Practices Statute, M.G.L.c 93A, because the awards entered in their favor in reference proceedings mandated by the Statute governing fire loss policies, M.G.L.c 175, §99, were not confirmed in a Judgment and the Plaintiffs did not establish any compensable economic injuries caused by the insurer’s c.93A/176D violations, rather than the fire loss.
The homeowners could not obtain a Judgment on the reference awards because the insurer’s payment of the full amount awarded by the panels in two reference proceedings, in addition to added Policy payments (approximately $16 million overall) eliminated the existence of any “actual controversy” concerning their rights under the Policy. Citing to Murphy v. Nat'l Union Fire Ins. Co., 438 Mass. 529, 533 (2003), the Court adhered to prior precedent that prevents a prevailing party from obtaining a Judgment on an arbitration award by refusing to accept the insurer’s full payment of the award(s) to pursue a claim for double or treble damages under c. 93A.
At the outset of the bench trial on the homeowners’ c.93A/176D claim, the Court ruled that PURE’s pursuit of its counterclaim to recoup portions of its prior Policy payments created an actual controversy that would have allowed the Plaintiffs to obtain judicial confirmation of the reference panels’ awards in a Judgment that would have been subject to doubling or trebling if the insurer committed any knowing or willful violations of c.93A/176D in its handling of the fire loss claim. The insurer avoided this risk by “belatedly” moving on the second day of the bench trial to dismiss its counterclaims with prejudice.
The trial court Judge acknowledged that “[i]t may seem unfair that a fire insurer like PURE may commit willful violations of G.L. c. 176D, § 3(9)(f) & (g) - by refusing to make a fair and equitable settlement even though liability had become reasonably clear, and by forcing its insureds to institute litigation to recover amounts due under their policy by offering substantially less than the amounts ultimately recovered through a statutory reference proceeding - but then avoid any consequences under G.L. c. 93A by paying the reference awards in full and years later dropping its claims to recoup a significant portion of the amounts paid. But that result is dictated by the SJC’s holdings in Bonofiglio and Murphy.”
Without the ability to rely upon a Judgment to secure an award of double or treble damages for the insurer’s knowing and willful c.93A/176D violations, the Plaintiffs had to establish that they sustained some form of “compensable injury as a result of PURE’s unfair insurance settlement practices” to establish an entitlement to relief under c.93A. Based upon its examination of the evidentiary submissions offered during the bench trial for each category of injuries claimed by the Plaintiffs, the Court concluded that they failed to establish any compensable delay damages from increased construction costs, any added litigation expenses caused by Pure’s violation of c.176D by “compelling Plaintiffs to institute litigation to recover Amounts” owed under their policy, and/or any emotional distress from the insurer’s allegedly unfair claims handling practices.
Based upon the Plaintiffs’ failure to prove that they suffered any compensable injury as a result of PURE’s unfair insurance settlement practices, the Court entered an Order for Judgment to enter in PURE’s favor on the Plaintiffs’ c.93A and 176D claims.
NORTH of the BORDER
Heather A. Sanderson, K.C.
Sanderson Law
Calgary, Alberta, Canada
[email protected]
The content of this column also appears in the “Liability & Insurance,” a monthly newsletter focusing on Canadian coverage and published by Heather Sanderson. Contact her for a subscription.
09/15/26 Kallu v. The Wawanesa Mutual Insurance Company
British Columbia Court of Appeal
A Request to Remove Building Coverage Is Not Notice of an Undisclosed Grow-Op
A house fire began with a prayer candle, not with the marijuana grow operation discovered in a separate building on the property. Yet the British Columbia Court of Appeal has upheld Wawanesa’s refusal to cover the house-fire claim. Its decision leaves undisturbed the trial court’s conclusion (reviewed in the September 26, 2025, edition of this newsletter) that an undisclosed material change in risk can defeat coverage even when it did not cause the loss.
The appeal turned on a different question: did a written request to remove the outbuilding from coverage amount to notice of the grow operation inside it? In unanimous oral reasons delivered on September 15, 2026, the day of the hearing, the Court answered no.
Background
Parveen and Gurvinder Kallu bought their Abbotsford property in 2015. Wawanesa insured both the family home and an 1,800 square foot outbuilding about 200 feet away, clearly visible from the house. The policy was issued on July 31, 2015, and renewed in 2016 and 2017. On June 13, 2017, Mr. Kallu signed a “Reduction of Coverage Form” with his insurance broker requesting that the outbuilding be removed from coverage. The stated reason was that it was leaking. The request never reached Wawanesa’s underwriting team; the outbuilding remained on the policy, and the premiums did not change. The trial judge also expressed “certain doubts” about whether the request had been made in good faith.
On March 1, 2018, a prayer candle started a fire in the children’s bedroom and damaged the home. An adjuster visiting the property shortly afterward found a marijuana grow operation in the outbuilding’s basement. The grow-op played no part in the fire. Wawanesa had not been told about the grow-op. Had it known, it would not have insured the property; grow-op properties are on its “do not submit” list. On March 22, 2018, Wawanesa told the Kallus that the policy was void as of July 2016 because of an undisclosed material change in risk, and it refused coverage for the fire. The Kallus responded that they did not know about it and argued that, in any event, they had sought to remove the outbuilding from coverage.
The trial judge did not accept the Kallus’ account of their lack of knowledge. She found that the grow operation had been established after they purchased the property and accepted underwriting evidence that its presence—even if it was no longer operating—was material to the risk presented by the insured property. The Kallus argued that a grow operation in the outbuilding should not affect a claim for a fire in the house. The judge rejected that argument, accepting that the risks of a grow operation are “not obviated simply by a short distance between buildings,” and held, following Schellenberg v. Wawanesa Mutual Insurance Company, 2020 BCCA 22, that the material change did not have to cause the particular loss for Wawanesa to rely on the policy’s material-change condition. She dismissed the claim.
The Kallus appealed.
On appeal, the Kallus concentrated on the form they had given their broker. The policy’s statutory condition required prompt written notice of a material change in risk to the insurer or its agent. Because the broker held their written request, they argued, the trial judge should have treated it as notice to Wawanesa. Alternatively, they argued that the trial judge made a palpable and overriding error in finding that their request to remove the outbuilding had never been delivered to Wawanesa.
Wawanesa answered that the Kallus had never pleaded that the broker was its agent, had led no evidence of an agency relationship, and had not made that argument at trial.
Writing for the Court, Horsman J.A. found it unnecessary to decide whether the broker was Wawanesa’s agent. Even assuming the broker could receive notice on Wawanesa’s behalf, the form did not identify the material change that required disclosure. It said the outbuilding was leaking. It said nothing about a grow operation. Nor, as the trial judge had observed, would removing the outbuilding from the list of insured structures answer the underwriting concern: the undisclosed risk was the presence of the grow operation on the insured property, not simply whether Wawanesa would pay for damage to the building that housed it. The trial findings were not challenged on appeal: the Kallus set up the grow operation after buying the property; it was a material risk for any reasonable insurer, and one Wawanesa will not insure; the risk was the same whether the grow operation was in the house or the outbuilding; and the Kallus never disclosed it. The Court agreed with Wawanesa that those findings were “a complete answer to the appeal.”
Although it did not need to, the Court, “for completeness,” also rejected the attack on the finding that the outbuilding remained insured. The policy continued to cover it, the premiums stayed the same, and Wawanesa’s underwriter testified that the company had not received the removal request and would have denied it if it had. The Court found no error in the trial judge’s conclusions, “let alone a palpable and overriding error,” and dismissed the appeal.
The practical lesson of the appeal concerns the content of the notice. Notice is measured by the risk it discloses. A request to stop insuring a leaking building did not tell the insurer—or, on the Kallus’ argument, its agent—about the undisclosed use of that building as a marijuana grow operation. And because the undisclosed change was material to the property risk Wawanesa had agreed to insure, the unrelated origin of the house fire did not rescue the claim.
© Hurwitz Fine P.C. 2026
All rights reserved
