10th Circuit Case Reinforces Limits Of Insurer’s Duty To Settle Disputed Claims (JD Supra)

10th Circuit Case Reinforces Limits Of Insurer’s Duty To Settle Disputed Claims

  Tuesday, July 27th, 2021 Source: JD Supra

A recent federal appeals court case applying Utah law goes to the heart of the conflict that arises between a policyholder and insurer when an insurer defends a policyholder under a reservation of rights and receives a settlement offer. The case is Owners Ins. Co. v. Dockstader, No. 19-4156 (10th Cir. June 29, 2021).

The facts are straightforward. A third-party claimant suffered a brain injury during a fight in a gym.

The tortfeasor’s liability insurer, Owners Insurance Company, agreed to defend the tortfeasor under a reservation of rights, and filed a declaratory judgment action for a ruling that its policy did not cover the policyholder’s conduct.

The third-party claimant made a settlement offer for the policy limit of $500,000. Owners accepted the offer, but only on the condition that coverage was found to exist in the declaratory judgment action.

The third-party claimant entered into a settlement with the policyholder in excess of policy limits but agreed not to execute the judgment against the policyholder personally in exchange for an assignment of the policyholder’s rights.

  Read Full Article
SOS Ladder AssistMid-America Catastrophe ServicesChurchill Claims ServicesWeller Salvage

  Recent Provider Listings

Serving California Statewide
California Fire Investigations
Serving Orange & Surrounding Counties
Florida Contents Inventory And Valuation Services
Serving California & Nevada Statewide
California Adjusters