Insurance Law

Dist. Ct. did not err in granting defendant’s motion for summary judgment in action by plaintiffs alleging that defendant breached duty of reasonable care under Ill. Insurance Procurement Liability Act to procure insurance on behalf of plaintiffs, where defendant failed to point out obvious signs that ultimate provider of said insurance was dishonest and that insurance eventually procured for plaintiffs turned out to be complete fraud. Record showed that neither plaintiffs nor any insurance broker in procurement chain ever requested defendant’s assistance with placement of said insurance, and that while defendant wanted to obtain commissions with respect to said insurance, defendant did not receive any commissions from fraudulent insurer. Ct. also rejected plaintiffs’ claim that defendant owed them duty under common law negligence principles, where Ct. found that defendant had made no affirmative undertaking to procure said insurance. Fact that defendant had performed on behalf of owner of company that provided fraudulent insurance certain administrative tasks on policies that were issued to other insureds did not require different result.

Dist. Ct. erred in granting defendant-insurance company’s motion for summary judgment in plaintiff’s action seeking additional payments from defendant pursuant to under-insured (UIM) provisions of defendant's $1 million commercial automobile policy, as well as defendant’s $5 million commercial umbrella policy that had been issued to plaintiff’s employer, where plaintiff sought said proceeds for injuries sustained in automobile accident incurred during plaintiff’s employment. While defendant paid plaintiff $900,000 under commercial automobile policy and $382,314.21 under umbrella policy (i.e. $1 million in UIM coverage less $617,685.79 that plaintiff had received in net workers’ compensation benefits), plaintiff was entitled to seek more insurance proceeds from umbrella policy, since Indiana statute required defendant to provide in its umbrella policy UIM coverage in amount equal to policy’s general liability limit of $5 million and not some lesser amount, where, as here, defendant had provided UIM coverage in umbrella policy. Fact that defendant was not required by statute to provide any UIM benefits in its umbrella policy did not require different result. Moreover, defendant was not entitled to subtract plaintiff’s receipt of workers’ compensation benefits from proceeds of umbrella policy since terms of said policy only required offset of workers’ compensation benefits received by plaintiff that were in excess of $1 million “retained limit.”

Dist. Ct. did not err in granting defendant’s motion for summary judgment in action by plaintiff-insurance company seeking declaration that it had no duty to defend or indemnify defendant in underlying action alleging that defendant’s customer incurred personal injuries from fitting room door supplied by insured, where defendant asserted that it was additional insured under terms of policy issued by plaintiff due to supplier agreement between defendant and insured. Supplier agreement required insured to name defendant as additional insured in commercial general liability policy, and that plaintiff’s policy promised to pay for bodily damages arising out of said fitting doors. Moreover, while language in customer’s personal injury action focused on defendant’s alleged negligence, allegations in said complaint fell within policy’s coverage where: (1) customer asserted bodily injuries arising out of insured’s door; and (2) defendant’s third-party action alleging that defendant was negligence with respect to door’s design and materials used in door fell within policy’s coverage. Also, plaintiff was responsible for entire settlement amount that defendant had negotiated with customer, where, although there was no evidence indicating allocation of settlement between covered and uncovered claims, defendant made settlement of otherwise covered loss in reasonable anticipation of liability in customer’s lawsuit.

Dist. Ct. erred in granting defendant-insurance company’s motion for summary judgment in action by plaintiff-decedent’s estate seeking to recover proceeds of accidental death policy issued by defendant under circumstances where: (1) decedent tore his left Achilles tendon playing basketball; (2) on day before scheduled surgery, plaintiff displayed symptoms of deep vein thrombosis (blood clot) in his injured leg; and (3) shortly after his surgery, plaintiff died when blood clot from injured leg became lodged in his lung. While defendant argued that decedent was not entitled to proceeds of policy since instant pulmonary embolism was not consequence of injury, but rather was consequence of surgery, Ct. of Appeals found that plaintiff was entitled to judgment since defendant had failed to make any plausible showing that surgery, rather than accident that necessitated surgery, caused decedent’s death.