Steven P. Nassi
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Eleventh Circuit: When an Insurer Has a Duty to Defend, Its Duty to Indemnify Is Not Ripe Until Resolution of the Underlying Lawsuit
With limited exception, an insurer that owes a duty to defend to its insured cannot litigate whether it also has a duty to indemnify the insured for the same matter until after the insured’s liability has been resolved. In a unanimous decision, the U.S. Court of Appeals for the Eleventh Circuit, applying Florida law, affirmed this principle and held that an insurer’s duty to indemnify is not justiciable until the insured’s liability has been adjudicated in the underlying case. Mid-Continent Cas. Co.
NY Court Clarifies Pleading Standard for “Consequential Damages” in Coverage Litigation
The Appellate Division of New York’s Supreme Court, First Department, recently overturned a trial court’s dismissal of an insured’s claim for consequential damages on a pre-answer motion to dismiss. While the decision sheds light on the degree of specificity required at the pleading stage to sustain an insured’s claim for consequential damages, it does little to clarify the level of proof required to prevail on such claim at trial. The coverage dispute among the parties in D.K. Property, Inc.