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CLM National: August 2021

News and verdicts that affect you from across the country

August 17, 2021 Photo

A bill that would have ended Florida’s no-fault system is vetoed, a Maryland decision clarifies when recovery is possible under the state’s wrongful death statute, and a loss estimate is in for Hurricane Elsa damage.

Illinois

No Coverage for Punitive Damages

The sun shone a little brighter for insurers who do business with Illinois insureds, as the Northern District of Illinois recently held that an excess carrier is not required to indemnify its insured for a punitive damage award from Georgia. In Ironshore Specialty Insurance Co. v. Akorn, Inc., the U.S. District Court for the Northern District of Illinois emphasized Illinois’ strong public policy prohibiting insurance coverage for an insured’s conscious disregard for the safety of others in a negligent failure-to-warn case, recognizing the risk associated with allowing insureds to take “advantage of their wrong” by passing certain punitive damages to insurers. The decision means that, regardless of where the punitive damages are originally awarded, the Illinois public policy bar on coverage for punitive damages can apply to even unintentional or negligent conduct so long as the conduct shows some level of conscious disregard for the safety of others. Moreover, a primary insurer’s coverage decision does not bind or constrain an opposite coverage decision by the excess insurer.—From CLM Members Michael J. Duffy and Alexandrea Y. Diaz, Wilson Elser

Florida

DeSantis Vetoes Bill to End No-Fault

Florida’s status as a no-fault state was about to come to a ceremonial end after the legislature passed Senate Bill 54, which effectively eliminates Florida’s no-fault system and requires motorists to carry bodily injury liability insurance. The bill passed on April 30 and was sent to the desk of Gov. Ron DeSantis for signature. He vetoed it. DeSantis’ action means that the current no-fault system, which requires motorists to carry $10,000 in personal injury protection (PIP) coverage, stays in place. There will also be no changes to Florida’s interesting distinction of being one of only two states that does not require bodily injury liability auto insurance. The other state is New Hampshire. Wisconsin was the third state, but, as of 2010, it now requires liability insurance. However, Florida will continue to require bodily injury liability insurance if the driver has been found guilty of driving under the influence.—From CLM Member Elizabeth K. Hernandez, Matthiesen, Wickert & Lehrer

Georgia

U.S. Elsa Insured Losses Estimated at $240 Million

U.S. insured losses to onshore properties from Hurricane Elsa will be around $240 million, according to Karen Clark & Co. Including damage to the Caribbean, insured losses could hit $290 million. The storm impacted parts of the Caribbean as a hurricane before making landfall in Taylor County, Florida as a tropical storm. It made a second landfall in East Hampton, New York, and also impacted Georgia, South Carolina, and several mid-Atlantic and Northeast states. Elsa caused downed trees and power lines, and isolated structural damage, in part from tropical storm-induced tornadoes in Georgia, South Carolina, and Florida. In Georgia, an EF2 tornado flipped trailers and RVs and damaged other structures at a naval submarine base. Further north, Long Island, coastal Connecticut, and New Jersey were hit with minor wind damage that caused downed trees and power lines.—From Senior Managing Editor Phil Gusman

Maryland

No Recovery if Negligence Did Not Cause Decedent’s Death

In Scott Wadsworth, et al. v. Poornima Sharma, M.D., et al., plaintiff’s wife saw defendant, an oncologist, at a point where she had stage IV metastatic breast cancer, and with proper treatment had a life expectancy of 80 months. As a result of the doctor’s negligence, the cancer was not discovered at that time and, almost three years later, in 2016, the cancer was discovered by another health care provider. She received the same cancer treatment that she would have received had the cancer been discovered by the first oncologist. She died of metastatic breast cancer in 2017; thereafter a lawsuit was filed against the oncologist who failed to diagnose the cancer, and the doctor’s employer. The Maryland Court of Special Appeals held beneficiaries of a decedent in an action brought under Maryland’s wrongful death statute cannot recover if they cannot prove that the defendant’s negligence caused the decedent’s death. Loss of years of life is not a compensable damage to beneficiaries under Maryland’s Wrongful Death Act.—From CLM Members Marisa Trasatti and Law Clerk Leah Massicot, Wilson Elser

Pennsylvania

Medical Device Liability Questions Head to Supreme Court

In Ebert v. C.R. Bard, a G2 clot filter made by Bard was placed into the plaintiff’s inferior vena cava, but later could not be removed because one of its struts broke, grew into the vein wall, and was caught in the plaintiff’s pulmonary artery. The plaintiff brought suit, alleging negligent design and strict liability. The 3rd Circuit Court of Appeals determined that the standards for analyzing liability for a medical device manufacturer under Pennsylvania law were unclear, stating that it was unclear what standard of care should be applied to an implantable medical device in a negligent design claim, and that there are countervailing interpretations for whether strict liability claims apply to prescriptive medical devices. The 3rd Circuit sent both questions to the Pennsylvania Supreme Court for review. What remains to be seen is if Pennsylvania will ultimately issue distinct rulings on whether negligent design claims or strict liability claims can apply to a prescriptive medical device.—From CLM Members Kathleen D. Wilkinson and Alex Hammershaimb, Wilson Elser

Rhode Island

McKee Vetoes Auto Body Bill

Gov. Daniel J. McKee has vetoed HB6324, an auto body bill that would add language to the insurance Unfair Claims Settlement Practices Act. The bill would add costs insurers would be required to pay to auto body shops when a covered vehicle is repaired. Specifically, the bill adds the following language to the definition of unfair claims practices: “Refusing to pay an auto body repair shop for documented necessary sublet services…including costs and labor incurred to research, coordinate, administrate or facilitate the necessary sublet service, and an automotive industry standard markup.” Examples included towing, transportation, suspension, alignments, electronic calibrations, diagnostic work, mechanical work, and paid charges to release a vehicle. In his veto, McKee says, “While I recognize the stated intent of this bill is to protect consumers…overall the legislation will add costs without adding commensurate benefits to consumers.”—From Senior Managing Editor Phil Gusman

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About The Authors
Phil Gusman

Phil Gusman is senior managing editor for CLM Magazine and Construction Claims magazine.  phil.gusman@theclm.org

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