MIchigan Archives - The Insurance & Reinsurance Report

July 18, 2018 Fraud / Industry News

Sixth Circuit Uses Every Tool in the Box To Build Case for Coverage for Defrauded Policyholder

July 12, 2018, we reported on the Medidata decision handed down by the Second Circuit in which the court found coverage for a claim resulting from social engineering fraud. We suggested the ruling in Medidata lacks persuasive power due to its unusual factual circumstances and atypical policy language. The Sixth Circuit’s decision in American Tooling Center, Inc. v. Travelers Casualty & Surety Co. of America, No. 17-2014, 2018 WL 3404708 (6th Cir. July 13, 2018), will have more persuasive power, but due to …

February 9, 2017 Duty to Defend

Engineering Firm Gets Soaked By Professional Services Exclusions in Water Treatment Plant Claim

In an unpublished decision, the Sixth Circuit affirmed a lower court’s decision judgment in favor of two insurers. Specifically, the Sixth Circuit broadly construed professional services exclusions to preclude coverage.

As background, the Village of Dexter in Michigan hired an engineering and architecture firm, Orchard, Hiltz, & McCliment, Inc. (OHM), to oversee the upgrade of a wastewater treatment plant. The project included both the design and construction phases. Notably, Dexter approved three OHM proposals for professional engineering services. In addition, during the construction phase, OHM …

January 7, 2016 Automobile Coverage

Location, Location, Location: Michigan PIP Benefits Awarded to Illinios Claimant Where Location of Accident is Only Connection to Michigan

Michigan’s no-fault insurance benefits, especially Personal Injury Protection (PIP) benefits, are among the most favorable to claimants. Michigan law requires no-fault insurance for every vehicle owner. This insurance pays for medical expenses, wage loss benefits, replacement services, and damages to other people’s property, no matter who caused the accident. These provisions make Michigan’s no-fault coverage attractive to injured claimants when insurance coverage may not otherwise be available or fault may be difficult to establish, as shown by a recent case decided by Michigan Court of …

December 17, 2015 Fraud

Daughter Does Not Have to Pay for the Sins of Her Mother: Insurer Entitled to Restitution from Insureds but Appellate Court Remands Damage Award

The 2015 holiday season might be a bit tense for a mother-daughter team ordered to pay restitution to their insurer for fraud and misrepresentation. Secura Ins. v. Thomas, 2015 Mich. App. LEXIS 2230 (Mich. App. December 1, 2015). While restitution was owed for the wrongful acts, the court held joint and several liability did not apply to frauds in which a party (the daughter) was not directly involved. This case presents an example an insurer performing excellent due diligence in discovering fraud, and a …

October 14, 2015 Uncategorized

Rental Property Fire Presents a Review of Residential Insurance Policies in Michigan

On September 29, 2015, the Michigan Court of Appeals affirmed a directed verdict granted to an insurance agent, Jervis-Fehtke (Jervis), on a professional negligence claim brought by a property owner, Williams, as a result of damage to Williams’ rental property caused by fire.

After a gas explosion destroyed Williams rental property, Williams submitted a claim to her insurer, Auto-Owners Insurance Company (Auto Owner). Auto-Owners denied the claim because Williams’ policy did not cover losses caused by explosions originating from outside of the property. Williams, appearing …

March 31, 2015 Environmental

Where There is Fire, There is Smoke

In Hobson v. Indian Harbor Insurance Co., No. 316714, 2015 WL 1069242 (Mich. Ct. App. Mar. 10, 2015), the appellate court in Michigan rejected the insurers’ interpretation of the pollution exclusion in the landlord’s commercial general liability (“CGL”) insurance policy to deny the tenants’ bodily injury claim.

The dispute arose when the plaintiffs sustained bodily injuries from a fire that broke out in the apartment building where they resided. Subsequently, the plaintiffs sued the landlord and its insurers, alleging that the fire was caused …