9/19/2018 6:01:00 AM

Source: Business Insurance

Insurers have received claims worth 680 million Chinese yuan ($99 million) related to typhoon Mangkhut so far from Guangdong province in China, South China Morning Post reported citing media sources. The Guangdong province’s government said that the typhoon is likely to cause at least CNY 4.2 billion in economic losses in the region. Jianglong Shipbuilding Co. Ltd. said that the storm caused about CNY 5 million worth of damage to its production facilities, warehouses and ships. The typhoon struck southern China on Sept. 16.

9/19/2018 6:04:00 AM

Source: Business Insurance

Marine insurers are likely to pay up to €590 million ($689 million) for fire-related damage at a shipyard in Germany, Yacht Harbor reported. U.K.-based insurer Lancashire Holdings Ltd. is expected to pay €70 million, while RSA Insurance Group P.L.C., Beazley P.L.C. and Atrium Underwriting Group Ltd. are likely to pay up to €45 million each. The fire broke out at Lurssen Maritime Beteiligungen GmbH and Co. K.G.’s Bremen shipyard on Sept. 14 and damaged infrastructure and an under-construction 140-meter yacht.

Judy Greenwald

9/13/2018 8:50:00 AM

Source: Business Insurance

A federal appeals court has upheld a lower court ruling that an American International Group Inc. unit is not liable under its property coverage for financial losses stemming from its policyholder’s defective material.

Evansville, Indiana-based Berry Plastics Corp. produced a foil laminate product for Auburn, Maine-based Packgen, a small firm that manufactures specialized containers for bulk quantities of industrial chemicals, manufacturing byproducts and other material, according to Monday’s ruling by the 7th U.S. Circuit Court of Appeals in Chicago in Berry Plastics Corp., n/k/a Berry Global Inc. v. Illinois National Insurance Co.

Over two years, Packgen worked with one of its customers to develop a new type of intermediate bulk container that could be used to store and ship a chemical catalyst the customer produced for use in refining crude oil into other petroleum products. Packgen engaged Berry to manufacture a laminated product for this container, according to the ruling.

But a large roll of foil laminate Berry had delivered was defective, leading to several fires, and no market for the containers developed. Packgen sued Berry over the issue, and a jury awarded Packgen the full $7.2 million it had sought in damages.

Berry then sought coverage from AIG unit Chicago-based Illinois Indemnity under its property coverage for all but the first $1 million of the award, which Berry’s primary insurer, Federal insurance Co., a Chubb Inc. unit, agreed to pay.

Berry’s policy covered damages the company was required to pay “because of…Property Damage,” according to the ruling.

Berry argued it was entitled to coverage because it had “been held liable for its customer’s lost profits because of the property damage its defective component caused,” said the ruling.

Illinois National’s position was the $6.2 million for which Berry was seeking indemnification “represented Packgen’s lost profits” and “there was no property damage for which it had the duty under the policy to indemnify Berry.”

The U.S. District Court in Evansville, Indiana, ruled in Illinois National’s favor, which a unanimous three-judge appeals court panel upheld after an extensive analysis.

“Although we agree with Berry that some portion of the lost profits theoretically might be attributable to property damage, Berry has neither undertaken to make that showing nor demanded the opportunity to do so,” said the ruling in upholding the lower court’s decision.

Mark A. Hofmann

9/12/2018 11:28:00 AM

Source: Business Insurance

The California Department of Insurance has issued a cease and desist order to the National Rifle Association, alleging that the NRA marketed an insurance product in California without a license.

In a statement announcing Tuesday’s order, the department noted that the NRA sponsors the Carry Guard Personal Firearms Liability, including Self-Defense Insurance Policy. According to the department, the product provides coverage for bodily injury or property damages that result from the legal use of a firearm.

Insurance Commissioner Dave Jones said, “The California Department of Insurance insists on full compliance with California law that requires persons soliciting the purchase of insurance in California must be appropriately licensed to do so. Because the NRA allegedly failed to comply with this California legal requirement, it became necessary for the department to take this action against the NRA to end this illegal conduct in California.”

The order alleges that the NRA sent emails to mailing list subscribers featuring NRA spokesperson Dana Loesch and NRA CEO Wayne LaPierre explaining why the recipient should buy the policy and outlining policy specifics. “The insurance code prohibits a person from soliciting or negotiating insurance policies in California without valid license,” said the department. “The NRA has never held an insurance license in California.”

Gloria Gonzalez

9/18/2018 7:00:00 AM

Source: Business Insurance

The extent of the insured damage caused by Hurricane Florence is still unclear, but some experts are drawing parallels to Hurricane Harvey because, like that storm, Florence is a multiday rainfall event, while others caution against such comparisons.

Florence made landfall on Friday morning and stalled across North and South Carolina, and its remnants continue to deliver record-breaking rainfall, dropping 36 inches on North Carolina and nearly 24 inches in South Carolina as of Monday evening.

Insured losses from what is now tropical depression Florence will total about $2.5 billion, according to an estimate Monday from Boston-based catastrophe modeler Karen Clark & Co.

“It’s not going to be as much the traditional wind,” said Michael Korn, leader of Integro Insurance Brokers’ property practice based in San Francisco. “It’s going to be about all the water that Florence is going to dump onto the land. As we saw in Harvey, that makes you start to think about how does each policy handle windstorm? How does each policy handle flood? Where does storm surge belong in a policy? There’s no one size fits all.”

9/14/2018 2:11:00 PM

Source: Business Insurance

(Reuters) — Some 8,000 people in Boston’s suburbs had little hope of returning home soon as investigators scrambled on Friday to find out the cause of dozens of gas explosions that destroyed scores of homes in the biggest such accident in nearly a decade.

The blasts on Thursday killed one person and left more than a dozen injured in Andover, North Andover and Lawrence and left more than 18,000 homes and businesses without power, according to emergency officials.

Massachusetts State Police said around 70 fires, explosions or investigations of gas odor had been reported Thursday, though by Friday afternoon officials said that all had been extinguished. It was unclear how many of the fires and explosions were in homes or other locations.

It was the largest natural gas pipeline accident, in terms of the number of buildings involved, in the United States since 2010, when an interstate natural gas transmission line operated by Pacific Gas and Electric Co. ruptured in San Bruno, California, destroying 38 buildings, damaging 70 more, and killing eight people, according to a Reuters analysis of incident reports from the National Transportation and Safety Bureau.

Investigators suspected that over-pressurization of a gas main belonging to Columbia Gas of Massachusetts led to the series of explosions and fires, Andover Fire Chief Michael Mansfield said on Thursday.

Gloria Gonzalez

9/14/2018 1:37:00 PM

Source: Business Insurance

The insured loss for Japan from Typhoon Jebi will be between $3 billion and $5.5 billion, according to an estimate from Risk Management Solutions Inc.

About 80% of the loss comes from the Kansai region, where Jebi made a second landfall west of Kobe, according to a statement released on Friday by the Newark, California-based catastrophe modeling firm.

The RMS estimate includes typhoon coastal flooding – observed in Kansai International Airport, in the ports of Kobe and Osaka and in localized areas of reclaimed land/barrier islands in Osaka Bay, as well as marine cargo losses from the ports, which were primarily from typhoon-driven coastal flooding. But typhoon-driven inland flooding was deemed to be negligible, according to the firm.

The estimate excludes losses from damage to infrastructure and port facilities and marine hull, claims adjustment expenses and some aspects of business interruption, including contingent business interruption.

Yasunori Araga, president of RMS Japan in Tokyo, said, “2018 continues to be an eventful year for natural catastrophes in Japan, both for earthquakes and typhoons.”

Judy Greenwald

9/14/2018 12:30:00 PM

Source: Business Insurance

Cargill Meat Solutions will pay $1.5 million to resolve U.S. Equal Employment Opportunity Commission charges that it discriminated against Somali American Muslim employees.

Wichita, Kansas-based Cargill Meat Solutions, a unit of Cargill Inc., said it settled the case, which involved 138 workers, to avoid a protracted legal proceeding.

The EEOC said in its statement Friday that it had found reasonable cause to believe the employees were harassed, denied their requests for prayer breaks and fired from their employment at Cargill’s Fort Morgan, Colorado, beef processing plant.

In addition to the financial settlement, Cargill will continue to conduct mandatory training for all management and hourly personnel at its Colorado facility, explaining employee rights under Title VII of the Civil Rights Act of 1964, the EEOC said in its statement.

EEOC Phoenix District Director Elizabeth Cadle said in a statement, “We applaud Cargill for working with the charging parties and the EEOC to reach a meaningful resolution enabling all parties to move forward.”

Cargill said in its statement, “While Cargill does not accept the basis of these EEOC complaints, it decided to settle the matter out of court to avoid a protracted legal proceeding and provide all parties with a path forward.”

Brian Sikes, president of Cargill Meat Solutions, said in the statement, “Providing our employees with religious accommodation is an important part of engaging and supporting our employees, and our policy has remained consistent for more than 10 years.”

The EEOC said in August a poultry supplier agreed to pay $3.75 million to settle an EEOC lawsuit that charged it with sexual harassment, national origin and racial discrimination, and retaliation against a class of Hispanic workers in its Mississippi chicken processing plant.

Judy Greenwald

9/6/2018 1:55:00 PM

Source: Business Insurance

Extended telemarketing calls are unrelated to a person’s right to privacy, says a federal district court in ruling in favor of an insurer in a coverage dispute with a telemarketer.

Libertyville, Illinois-based NuWave LLC, which manufactures and markets small appliances, was sued by the West Virginia attorney general in October 2015 on charges it engaged in unauthorized telemarketing, falsely represented that its products were free while charging exorbitant fees for shipping and handling, and used deceptive sales practices by falsely stating special product offers would end that day, among other charges, according to Wednesday’s ruling by the U.S. District Court in Chicago in NuWave LLC v. Cincinnati Specialty Underwriters Insurance Co.

The attorney general’s litigation charged the company with violating the West Virginia Telemarketing Act, among other laws.

The case was settled in March 2017 for $320,000, among other provisions of the settlement agreement, according to court papers filed in West Virginia state court in the case.

NuWave had two successive general liability policies with Cincinnati Specialty, a unit of Fairfield, Ohio-based Cincinnati Insurance Co., that provided coverage for violating persons’ right to privacy.

NuWave filed suit against Cincinnati after the insurance company refused to defend it in the litigation. The question is “whether the consumer’s right to privacy could possibly include the right to be free from prolonged phone calls,” said the ruling.

The ruling said it does not do so. “The flaw in NuWave’s argument is that neither invasion of privacy by intrusion nor invasion of privacy by disclosure of private facts is present in the (West Virginia attorney general’s) action,” said the ruling.

“The court has seen no mention that NuWave released any private facts about anyone,” the ruling said, in concluding Cincinnati has no duty to defend NuWave.

Judy Greenwald

9/6/2018 12:49:00 PM

Source: Business Insurance

Most major commercial lines reported higher renewal rates in August, according to the monthly report issued by insurance exchange Ivans Insurance Solutions on Thursday.

General liability was 2.5%, up from 2.2% at the end of July, according to the statement issued by Tampa, Florida-based unit of insurance technology firm Applied System Inc.

Other reported increases were: business owners policies, 4%, up from 3.8% in July; commercial property, 3.5%, up from 3% in July; and umbrella, 1.8%, up from 1.7% in July.

The renewal rate for commercial auto was 4.4%, down from 4.5% at the end of July.

Workers compensation renewal rates were down 2.2%, compared with a 3.4% decrease in July, according to the report.