Hurricane Helene made landfall in Florida on September 26, 2024, eventually making its way up to western North Carolina where it caused unprecedented damage. The estimated costs associated with these damages grow daily, with AccuWeather currently estimating losses between $145 and $160 billion. Earlier this week, we issued an alert with general tips policyholders should consider when pursuing insurance claims for hurricane-related losses. As damage reports continue to come in from portions of western North Carolina that have been cut off from regular communications, we are updating our guidance for North Carolina policyholders.

Continue Reading Tips for Pursuing Insurance Claims and Disaster Relief Funding in North Carolina After Hurricane Helene

Courts around the country have held that when an insurer breaches its duty to defend, it can face significant consequences, including limitations on the insurer’s ability to apply hindsight analysis when belatedly reviewing the insured’s defense invoices for reimbursement.

Continue Reading North Carolina Business Court Holds that Defense Costs Are Presumed Reasonable When Insurers Breach the Duty to Defend

RELATED UPDATE: Tips for Pursuing Insurance Claims and Disaster Relief Funding in North Carolina After Hurricane Helene (October 3, 2024)

Hurricane Helene made landfall on Thursday, September 26, 2024, carrying catastrophic 140 mph winds as the first known Category 4 storm to hit Florida’s Big Bend region since records began in 1851. By Friday, Hurricane Helene’s effects could be felt through Georgia, South Carolina, North Carolina, Tennessee, and Virginia, with numerous fatalities and significant property damage and power outages reported across the entire southeastern United States. Flooding from the storm resulted in highway and road closures throughout the region, including Interstate 40 in North Carolina, and multiple dams in Tennessee and North Carolina were on the brink of failure before stormwaters began to subside.

Continue Reading Tips to Maximize Insurance Recoveries for Hurricane Helene Property Damage and Business Interruption Losses

On June 6, 2024, the Supreme Court issued its opinion in Truck Insurance Exchange v. Kaiser Gypsum Co., No. 22-1079, conferring broad standing to debtors’ pre-bankruptcy liability insurers to appear and be heard in Chapter 11 bankruptcy proceedings. The ruling eliminates the “insurance neutrality” doctrine that previously constrained the participation of insurers in Chapter 11, greatly expanding insurers’ capacity to influence the reorganization process.

Continue Reading Shifting Gears on Insurer Participation in Chapter 11 Proceedings: U.S. Supreme Court Rejects Longstanding “Insurance Neutrality” Doctrine

On April 19, 2024, the U.S. Environmental Protection Agency announced the designation of two per- and polyfluoroalkyl substances (PFAS)—perfluorooctanoic acid (PFOA) and perfluorooctanesulfonic acid (PFOS) and their salts and structural isomers—as hazardous substances under the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA).[1]  In its designation, the EPA has identified over 85 industries it believes are most likely to be directly or indirectly affected by the designation.  

Continue Reading Steps for Companies to Maximize Potential Insurance Recovery After the EPA’s Recent PFAS Designation

Dairy is the latest round of kitchen staples to suffer from viral diagnoses.  In a first, the H5N1 virus, commonly referred to as the bird flu, is rapidly spreading through US cattle herds.[1]  The virus has already been detected in pasteurized milk sitting on grocery store shelves.[2]  The World Health Organization labeled the outbreak an animal pandemic, but fears of animal to human transmission are rising.[3]  To prepare for the potential financial impact of this looming outbreak, livestock owners and businesses should consider their insurance policies as possible sources of recovery.

Continue Reading Milk Coverage for All Its Worth While the “Steaks” Are High: An Insurance Primer on Coverage for the H5N1 Bird Flu Outbreak

Following record-shattering data breaches, there has been a major push for increased transparency and regulation in the insurance industry regarding consumer data privacy. With an increase in consumer data collection, the threat of ransomware attacks can expose companies to potential litigation or regulatory action if not handled properly.

Read on to learn about the National Association of Insurance Commissioners’ Insurance Consumer Privacy Protection Model Law #674, which illustrates the NAIC’s continuing re-evaluation of its historical approach to privacy compliance requirements. How will Model Law #674, as adopted by states, affect insurers’ compliance obligations vis-à-vis the patchwork of state data compliance laws and regulations recently adopted or under consideration?

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On March 26, a containership struck the Francis Scott Key Bridge in Baltimore, Maryland, resulting in the collapse of the highway infrastructure and tragic loss of life.[i]  As communities grieve the loss of their loved ones, businesses around the world are grappling with the economic fallout, including significant supply chain disruptions.  The closure of I-695, which provides an alternate route for hazardous materials and oversized vehicles that are prohibited from going through the Baltimore Harbor Tunnel, has created a gridlock for companies with distribution warehouses nearby.[ii]  The many ships stuck at the Port of Baltimore blockage, which is the top port in the nation for automobile shipments, is likely to create a ripple effect for other ports worldwide.[iii]

Continue Reading Insurance Recovery for Businesses Impacted by the Francis Scott Key Bridge Collapse

The Appraisal Process

Even when an insurer agrees to cover an insurance claim, disputes often arise between the insurer and the insured as to the valuation of the loss, particularly for claims under commercial property and business interruption policies.  In these circumstances, policyholders should consider whether and to what extent the dispute could be resolved through an appraisal process before resorting to litigation.

Continue Reading The Appraisal Clause: What It Is, and When to Enforce It

Last week, Merck & Co. filed documents with the Supreme Court of New Jersey indicating that it reached a settlement with its “all risk” property insurers in a long-running coverage dispute involving over $1.4 billion in losses stemming from a 2017 NotPetya cyberattack that impacted tens of thousands of Merck computers. The coverage litigation, Merck & Co. v. ACE American Insurance Co., focused on the key question of whether the policies’ “hostile/warlike” exclusion applied to the NotPetya attack, which some intelligence agencies have attributed to Russian government attempts to destabilize Ukraine. The settlement was announced just a few days before the New Jersey Supreme Court was set to hear oral arguments during an appeal of the New Jersey state appeals court’s affirmance of a 2021 trial court ruling in Merck’s favor. Merck’s insurers had argued that Merck’s losses were barred by a war exclusion, but the New Jersey trial court found that the exclusion did not apply to malware and cyberattacks and instead was intended to apply only to physical acts of warfare between the armed forces of two or more countries. The terms and the amount of the settlement have not yet been disclosed.

Continue Reading Merck-Settlement of $1.4 Billion Coverage Dispute Over NotPetya Cyberattack Places Renewed Spotlight on War Exclusions in 2024