Also known as: insurance contracts · insurance agreement
Written by attorneys — see sources below.
An agreement by which one party, the insurer, undertakes to compensate another party, the insured or a beneficiary, for specified losses upon the occurrence of a designated event in exchange for the payment of premiums.
Icarus Aviation sued Island Manufacturing after a cargo plane crashed. Island Manufacturing held a liability policy with Ideal Solutions. Under the initial disclosure rules, Island Manufacturing produced the full insurance agreement so Icarus Aviation could evaluate whether Ideal Solutions would cover any judgment.
Ira Irving, a California resident, bought a life insurance policy from an out-of-state carrier that mailed premium notices and the policy to him in California. After Ira Irving died, his beneficiary sued the carrier in California court. The single deliberate contact of issuing and maintaining the policy with a forum resident supported specific jurisdiction over the coverage dispute.
Imran Iyer executed a will that devised his estate to the trustee of a revocable life insurance trust he had created during his lifetime. The trust owned several policies on Imran Iyer's life. The devise remained valid even though Imran Iyer retained ownership rights in the policies and the trust was amendable.
Inertia Dynamics held a commercial property policy with an insurer. After a fire loss, the insurer deliberately delayed investigation for months and offered a low settlement to pressure acceptance. Inertia Dynamics stopped paying premiums. The insurer's prior bad faith conduct weighed against treating the nonpayment as a material breach that excused further performance.
Interactive Data Corporation hired John Foley in June 1976 as an assistant product manager at a starting salary of $18,500. As a condition of employment Foley signed a confidential and proprietary information agreement. The company's president told Foley that if he performed his job well he would have a long and rewarding employment with the firm. Over the next six years and nine months Foley received steady salary increases, promotions, bonuses, awards, and superior performance evaluations, rising to branch manager of the Los Angeles office with an annual salary of $56,164 plus a merit bonus. In January 1983 Foley learned that his new supervisor, Robert Kuhne, was under investigation by the FBI for embezzlement from his former employer, Bank of America. Foley reported the information to Vice President Richard Earnest because he was worried about working for Kuhne in a supervisory position. Earnest told Foley not to discuss rumors and to forget what he had heard. In early March 1983 Kuhne informed Foley that the company had decided to replace him for performance reasons and offered a transfer to another division. Foley was later told he could continue as branch manager if he agreed to a performance plan, but when Kuhne met with him the next day Kuhne instead gave Foley the choice of resigning or being fired. Foley was discharged on March 13, 1983. Foley filed suit against Interactive Data Corporation alleging three causes of action: tortious discharge in violation of public policy, breach of an implied-in-fact contract to terminate only for good cause, and tortious breach of the implied covenant of good faith and fair dealing. The superior court sustained the company's demurrer without leave to amend and dismissed the action. The Court of Appeal affirmed the judgment. The Supreme Court granted review.
View caseIsabella Ingram, domiciled in State X, obtained an auto policy from an insurer while living there. After moving to State Y she was injured in an accident. The court applied the law of State X to interpret coverage because that state had the most significant relationship to the insured, the policy, and the parties at issuance.
Ralph Hague, a Wisconsin resident who had been employed in Red Wing, Minnesota, for the fifteen years preceding his death, died of injuries suffered when a motorcycle on which he was a passenger was struck from behind by an automobile. The accident occurred in Pierce County, Wisconsin, immediately across the Minnesota border from Red Wing. The operators of both vehicles were Wisconsin residents, as was the decedent, who resided with respondent in Hager City, Wisconsin. Mr. Hague held a policy issued by petitioner Allstate Insurance Co. covering three automobiles owned by him. The policy contained an uninsured motorist clause insuring him against loss incurred from accidents with uninsured motorists. The uninsured motorist coverage was limited to $15,000 for each automobile. After the accident, respondent moved to Red Wing, Minnesota. She subsequently married a Minnesota resident and established residence with her new husband in Savage, Minnesota. At approximately the same time, a Minnesota Registrar of Probate appointed respondent personal representative of her deceased husband’s estate. Following her appointment, she brought this action in Minnesota District Court seeking a declaration under Minnesota law that the $15,000 uninsured motorist coverage on each of her late husband’s three automobiles could be stacked to provide total coverage of $45,000. Allstate defended on the ground that whether the three uninsured motorist coverages could be stacked should be determined by Wisconsin law. Allstate pointed out that the insurance policy was delivered in Wisconsin, the accident occurred in Wisconsin, and all persons involved were Wisconsin residents at the time of the accident. The Minnesota District Court interpreted Wisconsin law to disallow stacking. Nevertheless, the court concluded that Minnesota’s choice-of-law rules required the application of Minnesota law permitting stacking. The court refused to apply Wisconsin law as inimical to the public policy of Minnesota and granted summary judgment for respondent. The Minnesota Supreme Court, sitting en banc, affirmed the District Court. The court interpreted Wisconsin law to prohibit stacking and applied Minnesota law after analyzing the Minnesota contacts and interests within the analytical framework developed by Professor Leflar. The United States Supreme Court granted certiorari to determine whether the Due Process Clause of the Fourteenth Amendment or the Full Faith and Credit Clause bars the Minnesota Supreme Court’s choice of substantive Minnesota law.
View caseIndia Inoue sued a foreign manufacturer in federal court. The manufacturer had obtained liability insurance from a carrier that defended and indemnified it. The court held that the insurer's contacts and the policy's role in the litigation supported personal jurisdiction over the manufacturer for purposes of the coverage dispute.
Respondent Compagnie des Bauxites de Guinée is a Delaware corporation. Its principal place of business is in the Republic of Guinea, where it operates bauxite mines and processing facilities. Forty-nine percent of its stock is owned by the Republic of Guinea. The remaining fifty-one percent is owned by Halco (Mining) Inc., a Pennsylvania company that contracted to procure insurance for CBG. In 1973, Halco instructed broker Marsh & McLennan to obtain $20 million in business interruption coverage. The first $10 million was placed with Insurance Company of North America. The excess $10 million was placed through Bland Payne in the London market with 21 foreign insurers. Fourteen of those insurers are petitioners here. The placing slip was initialed effective February 12, 1974. The excess insurers adopted the INA policy terms. After CBG allegedly suffered mechanical problems causing more than $10 million in losses, it filed a two-count diversity action in the Western District of Pennsylvania in December 1975. CBG named INA on the first count and the excess insurers on the second count. The excess insurers answered by asserting lack of in personam jurisdiction. They later moved for summary judgment on that ground. CBG served its first document request in August 1976. The request sought copies of all business interruption policies issued between 1972 and 1975. After objections and motions to compel, the district court overruled the objections in June 1978. The court later narrowed the request to policies delivered in or covering risks in Pennsylvania. Petitioners stated the documents were held by London brokers. The court ordered them to request the files and gave successive extensions through November 1978. On December 21, 1978, after petitioners offered only to make four million files available in London, the district court warned that failure to produce the information within 60 days would result in an order under Rule 37(b)(2)(A) assuming jurisdiction. On April 19, 1979, the court found the material had not been produced and entered the sanction. It also made independent findings of jurisdiction under the Pennsylvania long-arm statute and by implicit consent through adoption of the INA contract. The Court of Appeals for the Third Circuit affirmed the jurisdictional holding as to all but three excess insurers. It relied solely on the validity of the Rule 37 sanction. The Supreme Court granted certiorari because the decision conflicted with Familia de Boom v. Arosa Mercantil, S.A., 629 F.2d 1134 (CA5 1980).
View caseA party must disclose any insurance agreement under which an insurer may be liable to satisfy all or part of a possible judgment or to indemnify for payments made to satisfy the judgment. The disclosure allows the opposing party to evaluate the existence and extent of coverage that could affect collection of a judgment.
Yes. Solicitation and maintenance of an insurance contract with a forum resident constitutes a deliberate contact that can support specific jurisdiction when the suit arises out of that contact and the forum has a strong interest in protecting its residents.
A life insurance policy pays proceeds directly to a named beneficiary upon the insured's death outside of probate. The beneficiary designation creates a present contractual right that shifts enjoyment at death without requiring compliance with wills formalities.
An insurer's bad faith delay or deception in handling a claim weighs against treating the insured's later nonpayment of premiums as a material breach. Courts consider whether the breaching party's conduct comports with good faith and fair dealing when assessing materiality.